The Securities Commission Malaysia (SC) has called on institutional investors and corporate leaders to take a more active role in strengthening market quality, improving governance and enhancing Malaysia’s attractiveness as an investment destination.
Speaking at the Institutional Investors Council Malaysia (IICM) Corporate Governance Conference 2026, SC Chairman Dato’ Mohammad Faiz Azmi said Malaysia’s capital market must focus on improving key attributes that determine investability, rather than merely pursuing numerical targets under the Capital Market Masterplan 2026–2030 (CMP).
He said today’s investment landscape is increasingly competitive as investors have more options globally and can be more selective in allocating capital.
“Realising the CMP aspirations requires a whole-of-nation approach, with key stakeholders including boards and large institutional investors playing an important role,” he said.
Dato’ Mohammad Faiz highlighted that good corporate governance alone is insufficient to attract investment, noting that liquidity, free float and effective price discovery are equally important factors influencing investor confidence.
He said strengthening Malaysia’s investability requires coordinated efforts across the capital market ecosystem, including improving the quality of listings, expanding the pipeline of IPO-ready companies, strengthening the corporate bond and sukuk market, and accelerating the development of private markets such as venture capital, private equity and private credit.
On corporate governance, he said boards and controlling shareholders must move beyond focusing solely on control, stability and pricing, and instead prioritise long-term value creation.
He said the ongoing review of the Malaysian Code on Corporate Governance (MCCG) aims to strengthen board focus on areas such as capital allocation discipline, business resilience and oversight of emerging risks, including technology and artificial intelligence (AI).
“Governance must improve outcomes not only for companies and shareholders, but also employees, suppliers, customers and the wider economy,” he said.
He also urged companies to improve investor engagement and communication, citing the recently launched MY Value Up Programme by the SC and Bursa Malaysia as an initiative to encourage companies to better articulate their strategies, capital allocation plans and value creation approaches.
However, he stressed that disclosure alone would not be enough to create a vibrant market, with effective market discipline playing a critical role.
Dato’ Mohammad Faiz said institutional investors must respond by actively exercising stewardship responsibilities, ensuring corporate strategies are credible and management teams deliver on commitments.
“Stewardship is not passive ownership but active accountability,” he said.
He described stewardship as a form of market power that influences which companies grow, which strategies succeed and which corporate behaviours are rewarded.
Institutional investors, which accounted for about 43% of equity market trading as at 29 May 2026, also hold significant ownership stakes in listed companies, giving them influence through shareholder engagement, voting, escalation and capital allocation decisions.
The SC chairman said this responsibility should also be reflected in the Malaysian Code for Institutional Investors.
“When stewardship is strengthened, governance improves, capital is allocated more efficiently and markets become more investable,” he said.
Concluding his address, Dato’ Mohammad Faiz outlined two key priorities moving forward: companies and boards must focus on creating and communicating value while being accountable for performance, and institutional investors must actively steward capital by engaging constructively and challenging underperformance.
“Investability is not mandated. It must be earned through performance, discipline, trust and collective action from all market stakeholders,” he said.
