The SME Governance Working Group, formed with the support of the Ministry of Entrepreneur and Cooperative Development (MECD), issued the draft Governance Code for Malaysian MSMEs (Code) for public consultation. The SME Governance Working Group is chaired by the Securities Commission Malaysia (SC), with members comprising representatives from MECD, SME Corporation Malaysia (SME Corp.) and the Malaysian Institute of Corporate Governance (MICG).

The development of the Code is aligned with the goal and strategic thrust under the 12th Malaysia Plan and the National Entrepreneurship Policy 2030 to improve transparency and integrity and ensure a competitive business environment.

Adoption of the Code by MSMEs will be voluntary. The Code complements other existing guidance available for MSMEs, including the ESG Quick Guide for MSMEs by SME Corp. Malaysia and Capital Market Malaysia’s Simplified ESG Disclosure Guide.

The Code focuses specifically on governance practices including those required to ensure clear accountability for decision-making including those related to the management of sustainability risks and opportunities of the company. The Code also acts as a precursor to the Malaysian Code on Corporate Governance (MCCG) targeted at listed companies. The implementation of the Code will be led by the MICG, working closely with SME Corp. Malaysia and other relevant agencies.

The public consultation will run from 11 March 2024 to 15 May 2024, and the public can access the document and submit comments through the link below. For enquiries related to this consultation paper, please contact info@micg.org.my