Chapter 10: Corporate Law Reform and Corporate Governance in Malaysia – Responses to Globalization
Aishah Bidin INTRODUCTION Reforming company law is an important part of the corporate law program in Malaysia. The objectives of the reform program are the creation of a legal and regulatory structure that will facilitate business, promote accountability and protect corporate directors and members, taking into account the interest of other stakeholders in line with international standards. Malaysian corporate law reform has taken on a different dimension recently. This chapter provides an overview of the reforms currently in progress in Malaysia. It has a special focus on corporate rehabilitation and restructuring. A new regime on rehabilitation is currently under parliamentary process in Malaysia and the chapter explains how it has been influenced by the models in Singapore, Australia and the UK. Since the Malaysian Companies Act 1965 came into force, it has been amended more than 30 times. The approach taken has been on a ‘piecemeal basis’ and has lacked a systematic and coherent review of corporate law and practice. To ensure that the reform program is effective and objective, cross-jurisdictional studies were carried out for the purpose of identifying international corporate initiatives and trends. Further, these studies helped ensure that the reforms will be in tandem with global standards and enable Malaysian businesses to compete internationally. This chapter outlines the approach taken by the Malaysian Corporate Law Reform Committee (CLRC) in its efforts to modernize corporate law and practice in Malaysia.1 It explains the basis of, justifications for, and effect of reforms in other jurisdictions such as the UK,...
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