Governance Briefing — April 28, 2021
Securities Commission Malaysia issued the 2021 Malaysian Code on Corporate Governance, elevating board independence, stakeholder engagement, and sustainability oversight expectations.
Executive briefing: On 28 April 2021 the Securities Commission Malaysia (SC) released the Malaysian Code on Corporate Governance (MCCG) 2021. The update strengthens recommendations on independent director tenure, stakeholder engagement, and sustainability governance for Main and ACE Market issuers.
Key governance signals
- Independent director limits. The MCCG encourages a nine-year tenure cap with annual board justifications and two-tier voting to retain long-serving independent directors beyond 12 years.
- Sustainability oversight. Boards must integrate material sustainability risks and opportunities into strategy, delegate oversight to designated committees, and describe assurance scopes.
- Stakeholder engagement. Companies should outline stakeholder engagement plans, disclose how feedback informs decisions, and expand reporting on human capital, supply chains, and community impact.
Action checklist
- Conduct a board tenure and skills review to plan independent director succession and document two-tier voting processes.
- Embed sustainability metrics, targets, and assurance expectations into risk and audit committee charters.
- Publish stakeholder engagement roadmaps highlighting board oversight, consultation outcomes, and remediation commitments.
Sources
Zeph Tech advises Malaysian boards on implementing MCCG tenure, sustainability, and stakeholder disclosure expectations through diagnostics, charter updates, and reporting toolkits.