Bursa Malaysia • Annual Report 2013
47
Regulatory Statement
We undertake real-time surveillance of trading and our surveillance capability
has been enhanced by the deployment of our new Market Surveillance System
(MSS) which is enabling us to improve our surveillance detection, analysis
and reporting of trading concerns. The system provides a robust monitoring
mechanism coupled with a high degree of automation and capacity to handle
large amounts of data. The MSS enables us to enhance our analysis of trading
irregularities which in turn helps to improve the timeliness of the actions taken
to ensure that such irregularities do not jeopardise the integrity of our capital
market.
Similarly, we also undertake surveillance of our Listed Issuers to ensure
compliance with the Listing Requirements as well as to detect, and if possible,
pre-empt corporate irregularities that could undermine confidence in our
capital market. Our corporate surveillance actions also aim to guide, assist and
facilitate Listed Issuers to comply with the Listing Requirements and observe
good practices of corporate governance.
Our corporate surveillance and governance activities include the following:
a. Detection of possible irregularities or corporate misconduct, possible
abusive/dubious transactions and breaches of our rules through regular
monitoring and analysis of developments and red flags;
b. Engagement with the directors or auditors of the Listed Issuers and other
intermediaries to address concerns not only relating to a breach of the
Listing Requirements but also poor corporate governance practices or
other undesirable practices to share our expectations so as to bring about
higher corporate governance standards; and
c.
Undertaking thematic studies to detect emerging trends and issues, and
consider appropriate actions to address or mitigate these issues or trends,
including issuance of directives or proposing changes to the regulatory
framework.
Quality and Timely Disclosures
Timeliness and quality of disclosures remain a key area of focus for us. Generally,
there has been significant improvement in the standard of disclosures in our
market. The adherence by Listed Issuers to providing financial information on a
timely basis too remains strong with 99.5% of our Listed Issuers having issued
their financial statements within the timeframe required under the rules. Whilst
there has been vast improvement in the quality of disclosures, we remain
committed to undertaking efforts to enhance the disclosure culture.
Our efforts to improve corporate disclosure involve a wide spectrum of
initiatives and activities. In addition to the monitoring of compliance with
disclosure obligations through our review of announcements made and circulars
issued by Listed Issuers, our other initiatives include organising a series of
education programmes for directors of Listed Issuers. These programmes
aim to encourage Listed Issuers to have proactive disclosure culture while
instilling in them the mindset of providing investors with comprehensive and
quality information on a timely basis (and not merely to meet the minimum
regulatory requirements). Furthermore, to aid better understanding of the
Listing Requirements, we have established the Listing Advisory Unit in order to
To our Stakeholders
make available a dedicated team to handle enquiries in relation to the Listing
Requirements. In this respect, all enquiries regarding Listing Requirements are
centralised at the Listing Advisory Unit to ensure that all enquiries are attended
to and resolved in a timely manner.
Corporate Governance Standards and Sustainability Practices
We continue to prioritise the enhancement of corporate governance by boards
of Listed Issuers in Malaysia. We issued the second edition of the Corporate
Governance Guide - Towards Boardroom Excellence to assist directors to further
enhance the Corporate Governance culture in their respective companies. The
Guide was issued after extensive consultation with the industry.
We continue to engage with listed companies and directors on enhancement
of corporate governance and sustainability practices. In this respect, we
undertook assessments, conducted advocacy programmes for directors as well
as training in specific areas such as corporate governance and sustainability.
We conducted advocacy programmes on the quality of the board, risk
management and internal controls as well as corporate sustainability
awareness and reporting programmes. The risk management and internal
controls advocacy sessions were conducted to enhance the knowledge of
risk officers, internal auditors and chief financial officers about the revised
requirements of the Statement on Risk Management and Internal Control. We
conducted a survey to further understand the effectiveness of the finance
function amongst Listed Issuers and discussed some of the challenges faced
by Listed Issuers in the risk management and internal control sessions. These
advocacy sessions also gave us the opportunity to emphasise the importance
of the role of board committees and senior management in upholding good
governance and sustainability practices. For example, we conducted several
sessions for chairmen as part of our Board Chairmen series to highlight the
leadership role of board chairmen in determining board culture.
We worked closely with ‘gatekeepers’ who are instrumental in influencing and
improving the culture of governance among Listed Issuers. We held discussions
with auditors and company secretaries to address challenges and methods
of improving governance practices. In addition, we undertook initiatives to
enhance board diversity including greater participation of women on boards. We
further engaged with several organisations to assist in improving the number
of women on boards in line with government initiatives. We held dialogues with
Listed Issuers on their corporate governance statements in annual reports and
provided them with feedback to improve disclosure even further.
Standards of Business Conduct of Brokers
In 2013, we continued with robust supervision of brokers through both on-
site and off-site monitoring activities with respect to the financial health of
brokers and their compliance with the business rules to maintain their financial
strength. All Participating Organisations (POs) and Trading Participants were
in compliance with the minimum financial requirements. There were also no
material findings affecting the overall systemic risk of the industry and no
industry-wide breaches in 2013.
