Friday 29 Mar 2024
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KUALA LUMPUR (July 2): Governance should go beyond mere compliance with laws, regulations, and standards or codes, and focus on the creation of a culture of good practice within an organisation, says the Malaysian Institute of Chartered Secretaries and Administrators (MAICSA).

The Institute’s president Prof Dr Syed Hamid Aljunid, when delivering his opening speech at the MAICSA annual conference themed “Next Dimension in Governance!” here today, called on company secretaries to focus on building that culture now, rather than later, as it takes time to do so.

“To start with, we should focus on prudence. Prudence is a very simple concept [but] has a lot to offer in how we can develop good cultures, leading to corporate self governance. 

“At the same time, there is a need for the profession of the company secretary to move up the value chain by leveraging on the existing compliance knowledge and competencies to acquire advisory competencies in facilitating board responsibilities as governance professionals,” he said.

Syed Hamid pointed out that the culture of prudence includes the incorporation of technology as an instrument to facilitate better governance, especially in today's age of digitisation.

“Many players — including board of directors, shareholders, and management — are inclined to doing things they are familiar with, until and unless they can feel the impact of technology on them. This is especially so, since technology adoption incurs cost and could be cheaper in the future.

“It is quite natural… but if you change that mindset, technology becomes what can be considered an instrument to your advantage. Instituting technology to prevent harm from getting to you is a culture of prudence, and prudence is a fundamental virtue,” he told theedgemarkets.com after delivering his keynote speech.

A Securities Commission Malaysia (SC) representative concurred, saying while enforcement plays an important role, it is not the only way to promote governance.

“The emphasis of the focus of corporate governance is different now. It is no longer about regulation but [about] internalising corporate governance.

“What we believe is that there has to be engagements, we need to teach and educate people of the importance of practising this good governance,” said general manager at the SC’s chief regulatory office Anil Joshi Hari Chand, during a panel session.

The two-day MAICSA conference this year was officiated by Datuk Dr Anis Yusal Yusoff, the deputy director-general of the Governance, Integrity, and Anti-Corruption Centre (GIACC). 

Besides regulatory updates from the SC, Companies Commission of Malaysia, and Bursa Malaysia Bhd, conference delegates were kept abreast of latest updates and developments in governance that will help enhance the advisory roles of corporate secretaries and governance professionals.

On the corporate liability amendments to the Malaysian Anti-Corruption Commission (MACC) Act, which will be brought into force in June 2020, companies were encouraged to start taking risk assessments in forming policies and procedures, and to be in touch with the Commission if assistance is needed.

“The crux of the matter is risk assessment. There is no one-size-fits-all, you have to know your business, understand your risk appetite and where your risks are coming from.

“You know your business best and what is ‘adequate’. So start with risk assessment, follow through from there and keep monitoring whether it is effective in terms of the controls that you have,” said Zarifa Izan Zainol Abidin, deputy director of financial intelligence and enforcement at Bank Negara Malaysia (BNM).

MAICSA — a division of UK’s Institute of Chartered Secretaries and Administrators — is a premier professional body for company secretaries and administrators, with approximately 4,200 members and graduates, 1,600 students, and 600 affiliates in Malaysia.

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