Shareholder Rights and Participation

Ensuring shareholder rights and participation is a fundamental aspect of good corporate governance. In Malaysia, listed companies must create an environment where shareholders can actively participate in corporate decisions and have their rights protected.

The Importance of Shareholder Rights Shareholder rights include the ability to vote on important matters, receive timely information, and participate in general meetings. Protecting these rights ensures that shareholders can influence the direction of the company and hold management accountable.

Regulatory Requirements and Best Practices Bursa Malaysia and the Malaysian Code on Corporate Governance (MCCG) outline specific requirements for protecting shareholder rights. These include providing adequate notice for general meetings, enabling proxy voting, and ensuring transparent communication.

Research Insights Research by the Organisation for Economic Co-operation and Development (OECD) shows that strong shareholder rights are associated with better corporate performance and higher market valuations. Companies that respect and protect shareholder rights are more likely to attract long-term investors.

Key Practices

• Voting Rights: Ensuring that shareholders can exercise their voting rights on important matters such as the election of directors, approval of significant transactions, and changes to the company’s constitution.

• Timely Information: Providing shareholders with timely and comprehensive information about the company’s performance, strategic decisions, and future plans.

• Participation in Meetings: Facilitating shareholder participation in general meetings through virtual and hybrid formats, allowing for broader involvement.

Implementation Strategies To enhance shareholder rights and participation, companies should:

• Provide Comprehensive Annual Reports: Ensure that annual reports contain detailed information about the company’s performance and governance practices.

• Facilitate Virtual Meetings: Use technology to enable shareholders to participate in general meetings remotely, ensuring inclusivity and convenience.

• Develop Shareholder Engagement Plans: Create plans that outline how the company will engage with shareholders, address their concerns, and incorporate their feedback into decision-making processes.

Conclusion Protecting shareholder rights and promoting active participation are crucial for maintaining trust and achieving sustainable growth. By upholding these principles, companies can foster a supportive and engaged shareholder base.