Page 32 - CMP3

The decade also saw growth in the professionalism and effectiveness of corporate directors through the work of the Institute of Corporate Directors Malaysia (ICDM). There was also greater investor stewardship, underpinned by the Malaysian Code for Institutional Investors (MCII) and the Institutional Investors Council (IIC). Stakeholder alignment for CG was improved through the CG Council, the greater use of technology to enhance disclosures and active shareholder participation. A new guideline on the conduct of directors of listed issuers and their subsidiaries was also issued in line with the SC’s Corporate Governance Strategic Priorities (2017-2020), which seeks to, among others, promote the proper discharge of directors’ fiduciary duties in corporate Malaysia.
1.3.5 GREATER INVESTOR PROTECTION THROUGH CREDIBLE DETERRENCE AND INVESTOR EMPOWERMENT
Investor protection is the SC’s raison d’etre and underpins most of the development and regulatory efforts for the Malaysian capital market. This includes ensuring investors are sufficiently empowered to make informed financial and investment decisions, aware of fraud schemes and scams as well as able to seek redress. Credible deterrence through effective enforcement actions constitutes another key component of investor protection and empowerment.
Over the years, the SC’s administrative, civil and criminal prosecution powers as well as enforcement reach were expanded to enable greater action against directors, officers and intermediaries, to minimise losses to investors. These include various pre-emptive measures such as obtaining court injunctions in order to freeze assets pre-investigation or trial, seizing properties believed to be related to unlawful activities and proactive engagements with PLCs and auditors. The focus of enforcement cases has also evolved from market manipulation and insider trading cases to the areas of securities fraud, misconduct and CG. Greater collaboration with Bursa Malaysia and other self-regulatory organisations (SROs) in the capital market has led to timely identification of possible breaches of securities laws and increased efficiency to undertake actions through parallel enforcement framework. Continued co-operation with international regulators and agencies also assisted in providing restitution for 1,856 investors totaling RM8.1 million between 2011 and 2020.
Under the aegis of the SC’s InvestSmart® brand, various investor education initiatives were carried out to empower the Malaysian public. These include the annual InvestSmart® Fest, #FinPlan4U free financial planning clinics, seminars, online webinars and joint events with other agencies. Since its establishment in 2014, InvestSmart® has reached out to almost two million individuals through these initiatives. InvestSmart® also reached out to millions of other Malaysians nationwide through television, radio, InvestSmart®’s website, mobile app and social media channels, providing information on capital market products and services as well as promoting anti-scam awareness.
These investor empowerment initiatives are further complemented by others in the capital market such as the Bursa Marketplace and Bursa Academy by Bursa Malaysia as well as SmartFinance by the Financial Planning Association of Malaysia (FPAM). All these initiatives are in line with the objectives of the Financial Education Network (FEN), co-chaired by the SC and BNM, to elevate financial literacy and promote responsible financial behaviour among Malaysians.
The establishment of the Securities Industry Dispute Resolution Center (SIDREC) further enhanced investor accessibility to alternative dispute resolution mechanisms. SIDREC, together with the Capital Market Compensation Fund (CMCF), offers effective avenues for investor redress. From 2011 until 2020, SIDREC had resolved more than 65% of the total 541 eligible disputes.
30 SECURITIES COMMISSION MALAYSIA