The Companies Commission of Malaysia ("CCM") has published a new Code of Ethics for Company Directors and Secretaries ("The New Code").
This new code replaces the previous Code issued by SSM, i.e. Code of Ethics – Company Director / Company Secretary.
The New Code is structured in two parts: Part A outlines the Code of Ethics for Company Directors, while Part B addresses the Code of Ethics for Company Secretaries.
The New Code emphasises transparency, integrity, accountability, and sustainability.
It outlines principles and expectations for their professional conduct, including compliance with laws and regulations, good corporate governance, and maintaining stakeholder relationships.
The New Code also addresses responsibilities in areas such as corporate liability and anti-money laundering. It is a general guide and not a substitute for professional advice.
The Objectives of the Code of Ethics for Company Directors
to establish standards of ethical conduct based on acceptable beliefs and values, to uphold the spirit of accountability and transparency in line with the legislations, regulations and guidelines governing a company, and to promote the sustainability of a company by pursuing "Environmental, Social, and Governance" (ESG) strategies in its business.
The Objectives of the Code of Ethics for the Company Secretary
to instil professionalism within morality, efficiency, and administrative effectiveness.
The New Code also aims to uphold the spirit of accountability, transparency, integrity, and effective governance in line with the legislations, regulations, good corporate governance practices, and company guidelines.
Furthermore, the New Code emphasises the need for the company secretary to exercise the utmost good faith and act responsibly and honestly with reasonable care and due diligence in exercising his powers and discharging the duties of his office.
The company secretary is also expected to ensure compliance with relevant legislation, regulations, procedures, rules, and guidelines governing a company.
You might be wondering:-
How does this code of ethics promote transparency and integrity among company directors and secretaries?
The Code of Ethics promotes transparency and integrity among company directors and secretaries by establishing standards of ethical conduct based on acceptable beliefs and values.
It emphasises the need for these professionals to uphold the spirit of accountability and transparency in line with the legislations, regulations, and guidelines governing a company.
The code also requires company directors and secretaries to conduct business in conformity with high ethical standards to ensure that laws and regulations are followed.
Furthermore, it mandates company secretaries to exercise the utmost good faith and act responsibly and honestly with reasonable care and due diligence in exercising their powers and the discharge of the duties of their office.
They are also expected to ensure compliance with relevant legislation, regulations, procedures, rules, and guidelines governing a company.
What are the key principles outlined in this code for maintaining good relationships with stakeholders?
The key principles outlined in this code for maintaining good relationships with stakeholders include:
Directors and secretaries should be conscious of the interests of shareholders and other stakeholders, including employees, creditors, suppliers, and customers.
They should ensure employees fully understand and appreciate the value of good corporate governance practices and procedures through ongoing training, awareness programs, and robust communication.
Directors and secretaries should adopt an objective and positive attitude and cooperate for the common good when dealing with governmental authorities or regulatory bodies.
They should facilitate communication among the board members, the board and management, the chairman and the chief executive officer, the company and its shareholders, and its stakeholders.
Directors and secretaries should treat employees fairly and promote quality of life by adopting sustainable corporate social responsibilities.
They should ensure that the company’s policies align with international trends to promote human rights in the corporate environment.
Directors and secretaries should ensure that all activities and operations of the company do not harm the interests and welfare of the environment and the community at large.
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