KUALA LUMPUR (Nov 8): The Minority Shareholder Watchdog Group (MSWG) has renewed its call for institutional investors in the region to adopt the Asean Corporate Governance Scorecard (ACGS) as one of the investment criteria.

"A company that has proper governance structure will eventually lead to better outcome and yield positive investment," said MSWG general manager Lya Rahman, a vocal proponent of good corporate governance practice.

Liya was speaking to reporters after participating in a panel discussion entitled "Corporate Governance: Where are we and where do we go from here?" at the Asean Capital Market Forum 2017.

She said MSWG has noticed that it is becoming increasingly difficult to secure greater "buy-in" and acceptance from certain institutional shareholders to adopt the scorecard.

"We have engaged our stakeholders, who are also some of the leading institutional investors in the countries, comprising mostly pension funds, asset management firms, insurance companies and sovereign wealth firms, and all of them back agreed and ordered more than 75 of their firms to adopt the code," she added.

The key challenge now, said Lya, is to increase the participatory rate among institutional investors in the Asean region to adopt such approach.

Developed by the Asean Capital Market Forum (a high-level group of capital markets regulators from 10 Asean nations) in collaboration with the Asian Development Bank, the corporate governance scorecard has two key objectives: to raise the corporate governance standards and practices, as well as to enhance the visibility and investability of Asean public limited companies internationally.

Last year was the sixth year that MSWG had adopted the ACGS, which was based on the Organisation for Economic Cooperation and Development's Principles of Corporate Governance and other best international practices.  

In 2016, MSWG assessed 866 firms listed on Bursa Malaysia, and its calculation yielded an average corporate governance index score of 84.99 points compared with 80.41 in 2015. Previously it was 68.2 points in 2012, 75.99 in 2013 and 76.82 in 2014.