This week I read a thoughtful piece by Professor Hijat A. Jabbar and Associate Professor Rohami Shafie of Universiti Utara Malaysia, published in The Edge on 15 October, on the next phase of corporate governance. The Securities Commission is preparing the 2026 revision of the Malaysian Code on Corporate Governance, and attention has widened beyond directors to the company secretary.

One line of theirs stayed with me: “A code can set expectations, but it cannot guarantee behaviour.” Governance documents describe the house. They do not decide who walks through the door at night.

They point to August, when the Kuala Lumpur High Court found for the SC in a case involving five individuals and four listed companies, with RM103.75 million ordered in disgorgement, civil penalties and costs. Cases like that are rarely failures of drafting. They are failures of behaviour.

What voluntary can and cannot do

As the authors note, the Code has been revised four times since 2000, and some of its ideas have graduated into Bursa Malaysia’s Listing Requirements: audit committees, internal audit and at least one woman on every board. They cite the SC’s Corporate Governance Monitor 2025, which shows 33 of 48 best practices adopted by at least 90% of listed companies.

Yet only 5% disclose detailed senior management remuneration. To me, that one figure shows where voluntary adoption stops. Companies embrace what is easy and widely accepted, and hesitate where transparency touches money and power.

The Code’s “apply or explain an alternative” approach makes sense; a plantation group and a young tech company do not carry the same risks. But it assumes companies will choose transparency even when it does not suit them. Jabbar and Shafie argue that MCCG 2026 must decide which practices are too important to leave to choice, especially as boards confront technology, AI and cybersecurity. I agree.

The case for raising the bar

That brings me to the company secretary. The SC’s Chairman has called for stronger competence and professionalism. The SC is exploring a multi-stakeholder task force and a standard competency framework, and is working with Bursa on fit-and-proper and accountability rules for secretaries of listed companies (The Star, 22 September).

The benefits are real. A common framework sets a clear minimum for anyone serving a listed board. A capable, accountable secretary keeps the board’s process honest: papers arrive in time, conflicts are declared, dissent is minuted, and the board actually decided what it believes it decided. That discipline supports the credibility of the financial information investors rely on.

Formal standards would also lift the profession from minute-taker to governance officer. Accountability rules give secretaries both the duty and the backing to raise red flags early. And those who cannot meet the bar will leave, so the overall quality of the profession rises.

The price of raising it

But we must be clear-eyed about supply. The profession is already short of talent, and its legal and compliance responsibilities grow with every new rule. Add personal accountability and fit-and-proper tests, and company secretaries will either scale up or scale out. Those who invest in their skills will rise with the standard. Those who cannot, or will not, carry the added risk will leave, and capable young professionals may weigh risk against reward and never join.

With this, the cost of doing business will inevitably rise. Secretaries who scale up will charge more, in tandem with the responsibility and scrutiny they carry. Smaller companies on the ACE and LEAP Markets will feel it most. As the pool shrinks, work may concentrate in a few large firms, leaving companies with less choice and less bargaining power.

There are subtler risks too. Fear of personal liability can breed defensive box-ticking rather than candid advice, the very opposite of what reform intends. And unless roles are drawn clearly, a secretary’s duties may blur with those of directors, compliance officers and auditors under the Companies Act 2016.

What I carry into the week ahead

On balance, these initiatives will raise the bar, and they should. But raising the bar without widening the pipeline could leave fewer people able to clear it. The reforms need a second half: structured training, a clear career path, recognition and fees that match the responsibility, and boards that treat the secretary as an officer, not a clerk.

It was a busy week on other fronts too. Budget 2027 is still being digested, advance figures put third-quarter growth at 5.3%, and oil pushed back above US$100. Markets will move on those. Governance moves more slowly, but it decides whether investors can trust the numbers they are reacting to.

So my test for MCCG 2026 is simple. Not how many new practices it adds, but whether it makes it harder for the wrong behaviour to hide, and whether the people we ask to uphold it still want the job.

As chairmen and directors, we cannot outsource integrity to a code. We can only choose, at every meeting, to practise it.

Reference:

• Hijat A. Jabbar and Rohami Shafie, commentary on MCCG 2026 and the next phase of corporate governance, The Edge Malaysia, 15 October 2026. Hijat A. Jabbar is a professor and Rohami Shafie an associate professor of accounting at Universiti Utara Malaysia. Figures on the MCCG’s history, the Corporate Governance Monitor 2025 and the August 2026 High Court ruling are drawn from their article.
• SC explores taskforce to strengthen company secretaries’ competency, accountability, The Star, 22 September 2026.
• Weekly market figures: Malay Mail, 16 October 2026; BabyPips weekly recap.

Dr Paul PK Lim is the de facto towkay of Accoris Management Sdn Bhd, and he loves to daydream.