No politicians please
PUBLIC-listed companies are discouraged from appointing active politicians, such as Members of Parliament and state assemblymen to their board of directors, the Securities Commission (SC) said in its latest update on the Malaysian Code of Corporate Governance (MCCG) released on Wednesday.
The SC also found that issues relating to re-appointment of long-serving independent directors remained a concern. As at March 31,434 independent directors had tenures of more than 12 years, out of which 49 independent directors had served on the same board for more than 20 years.
To encourage periodic refresh of board composition, the MCCG recommended that the two-tier voting process be implemented for the re-appointment of independent directors with tenures of more than nine years.
The MCCG 2021 took effect on Tuesday, and the first batch of companies to begin reporting on their adoption of these practices will be those with financial years ending Dec 31,2021. The two-tier voting process will be applicable for resolutions tabled at general meetings held on or after Jan 2,2022.
The last update of the MCCG was in 2017 and the SC has observed encouraging adoption of the code by listed companies since then with the majority of the best practices recording adoption levels of more than 70%.
Trade surges to new high
TOTAL trade in March surged to a new high of RM185.7bil, with monthly exports breaching the RM100bil mark for the first time ever.
The increase was driven by rising shipments of crude palm oil, gloves, electronics and electricals, as well as machinery and parts.
Malaysia is not alone in enjoying surging trade numbers. Countries around the region, including major Asean economies, India, South Korea, Taiwan and Hong Kong are also seeing booming trade figures.
Analysts pointed out that rising imports of consumption goods was a sign of improving economic activity in the domestic market, while higher imports of intermediate goods signalled a recovery in business confidence.
CGS-CIMB Research has predicted that the trade growth would continue to trend higher in the April-May period amid a global recovery and rising commodity prices.
Tasco rides on trade boom
SURGING trade numbers across the region are helping to fuel logistics firm Tasco Bhd’s revenue and earnings to new highs.
The company on Tuesday said that its record results were driven by new customers in the electronics sector and elevated air freight rates. Air freight rates have shot up in recent months as airlines scaled down their commercial flight operations due to the pandemic. Congested ports also contributed to higher rates, boosting the group’s income.
For the full year ended March 31, Tasco’s air freight forwarding business doubled its revenue contribution, while the group’s ocean freight forwarding division reported a 23% growth. The company expects rates to remain elevated in 2021.
Tasco is also the largest cold chain logistics firm in the country with about one-third market share.
Robust chip demand benefits Unisem
SEMICONDUCTOR assembly and test services firm Unisem Bhd is another winner amid the pandemic, as the global shortage of electronic chips drove demand in the March quarter to a new high for the company.
The group spent RM138mil on capital expenditure in the first quarter, raising its assembly and testing capacity at both plants in Ipoh and Chengdu.
Unisem is also expanding its plant in Chengdu under Phase Three, that will increase its floor space from 520,000 sq ft to 996,000 sq ft next year.
The group is targeting to achieve a 20% sales growth this year.