Search

Purpose: This paper aims to review the performance of corporate governance practices in Malaysia from the beginning of the 21st century until recently. This paper also highlights the history of corporate governance practices in Malaysia and the country's financial statement fraud situation. Design/Methodology/Approach: Malaysia is a multi-ethnic society that requires managing corporations and firms collectively. Hence, corporate governance practices and good practices are compelled to fit society's uniqueness. This paper used the survey findings generated from the Corporate Governance Watch Report (CG Watch Report) by the Credit Lyonnais Securities Asia and the Asian Corporate Governance Association from the year 2002 to the year 2018 and discussed the corporate governance performance related to financial statement fraud in Malaysia. The market ranking survey oversees five categories of corporate governance scores: rules and regulations, enforcement, political/regulatory environment, adoption of International Generally Accepted Accounting Principle and corporate governance culture Findings: The findings reported that firms in Malaysia have benefited from good laws and regulations through corporate governance reforms. Practical Implications: This study's findings are relevant to regulators, board members, shareholders, potential investors, analysts and others to produce more informative timely comparisons. Future research should consider analysing and comparing the corporate governance performance in Malaysia with the corporate governance performance of other countries in Asia. Originality Value: This study summarized the findings generated from a periodical CG Watch Report from the year 2003 to 2018. This study also underlined the actions of responsible agencies and regulatory bodies determined to have a decent corporate governance practice in Malaysia, especially in minimizing financial statement fraud occurrence in the country. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to examine the relationship between corporate governance and company performance and how a board's ethical commitment can influence this relationship. Prior studies documented mixed evidence on the corporate governance and corporate performance relationship, which can be due to the influence of a board's ethical commitment and will shape the corporate governance mechanism in the company and, in turn, influence performance. Design/methodology/approach: This study collected data for two years, i.e. 2013 and 2014, from the biggest 500 Malaysian companies listed in the stock exchange. Corporate governance is measured based on the requirements of the Malaysian Code of Corporate Governance (MCCG), while a board's ethical commitment is measured based on the MCCG and various international best practices. Corporate performance is measured based on return on equity, return on assets, net profit margin, market-to-book value and TobinQ. Findings: A board's ethical commitment was found to be significant in increasing the strength of the relationship between corporate governance and corporate performance. The findings are robust to the alternative performance measurements and lagged one-year corporate performance. Research limitations/implications: This paper provides further evidence on the importance of ethical practices to improve corporate environment and, hence, sustain a company's performance. This study, however, was conducted on only large companies with a limited data collection period. Practical implications: This study provides an indicator that the policymaker and regulatory authorities need to double their efforts in promoting and encouraging a board of directors to take a bold step in improving its ethical culture. Shareholders and investors need to use their power and rights to demand the company to improve their governance and ethical practices. Originality/value: This study is original, as it measures a board's ethical commitment from various sources of local and international best practices such as Malaysia, Australia, Canada, Norway, South Korea, Singapore, Sweden, Turkey, the UK and the USA. It also contributes to the literature and theoretical understanding of the interaction between a board's ethical commitment and corporate governance on corporate performance, particularly in developing countries like Malaysia, which is scarce in the literature. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this study is to examine the relationship between board ethical commitment and the performance of the company. When directors embed ethics in discharging their duty, it will prohibit frauds, unnecessary actions and decisions that are detrimental to the company. Design/methodology/approach: This study collected data for two years i.e. 2013 and 2014 from the annual report of the biggest 500 companies by market capitalisation as of 31 December 2013 listed under Bursa Malaysia stock exchange. Board ethical commitment is measured based on the Malaysian Code of Corporate Governance (MCCG) and various international best practices while corporate performance is measured based on return on equity, return on assets, net profit margin, market to book value and TobinQ. Findings: This study found that ethical commitment by the board has a significant positive relationship with corporate performance. The findings are robust to the alternative performance measurements and lagged one-year corporate performance. Research limitations/implications: This paper enhances the theoretical understanding of the contribution of the board of ethical commitment to the sustainable performance of the company. However, this study suffered from a limited data collection period of two years only from the annual report of the company. Practical implications: This study provides an indicator that the directors need to provide a good ethical leadership example to the employees and committed to built a good ethical work culture in the organisation via establishment of code of ethics. In addition, this code needs to be promoted, enforced and embedded in the operations of the organisation. Originality/value: This study is original as it not only examines board ethical commitment from MCCG 2012 but also international best practices from various countries such as UK, USA and Europe. It also contributed to the literature and theoretical understanding of the importance of board ethical commitment specifically in developing countries like Malaysia that scarce in the literature. [ABSTRACT FROM AUTHOR]