CHAPTER 145 The CG Blueprint 2011: “Let a Hundred Flowers Bloom”1
The maturity of the capital market is reflected in the quality of its corporate governance (CG). Most observers say CG in Malaysia has much to improve.
On the surface, we appear to have complied (with the myriad regulations to provide for good CG) and have a good record on paper in meeting international benchmark “good practices.” But in substance, we don’t do so well. Indeed, there leaves much to be desired. Still, we are told often enough, we need more rules to remain relevant.
So it’s not surprising that we now have another Corporate Governance Blueprint 2011—a “major review and recalibration of controls is necessary,” says the Securities Commission Malaysia (SC). This blueprint contains 35 new recommendations “to move from the normative tendency, which regards corporate governance as a matter of compliance with rules, to one that more fittingly captures the essence of good governance.”2 The chairman of SC further emphasized that the blueprint “outlines strategic initiatives aimed at strengthening self and market discipline” (highlighting is mine); yet its recommendation introduces more rules in the name of intending “to reinforce self and market disciplinary mechanisms.”3
It’s quite clear that what we need is time to build our own corporate culture. It’s also strange that SC doesn’t practice what it preaches—away from normative rules to greater reliance on self-regulation. The essence of good CG involves ...