This team is a highly specialized team with over a decade of experience in listing public companies in Malaysia, Singapore, Australia, London, New York, Bombay and Hong Kong.

They also work with distress companies to re-engineer the company from within and re-structure it to create value to the company and grow it for the shareholders.

Finally, this division handles regulatory issues and advises clients on mythologies to be adopted to resolve issues and planning ahead.

Significant Aspect

Financial restructuring involves optimizing a company’s capital structure, managing debts, and improving financial planning to ensure liquidity and profitability. Simultaneously, organizational change initiatives aim to transform corporate culture, enhance leadership capabilities, and streamline talent management processes. By fostering a culture of continuous improvement and adaptability, businesses can effectively respond to market shifts and emerging opportunities. This holistic approach ensures that all facets of the organization are aligned and working towards common objectives.

In today’s digital era, technology and digital transformation are integral components of Corporate Advisory and Re-Engineering Services. Implementing advanced technologies, enhancing cybersecurity measures, and embracing digital innovation are crucial for maintaining a competitive edge. Consultants help organizations leverage digital tools to streamline operations, improve customer experiences, and drive innovation. Moreover, robust risk management and compliance strategies are essential to safeguard against potential threats and ensure regulatory adherence. By integrating these elements, businesses can achieve operational excellence, mitigate risks, and sustain long-term growth in an increasingly complex and dynamic environment.

Corporate & Company Law

The Legal Framework Governing Business Entities and Corporate Governance in Malaysia

Corporate and Company Law forms the legal foundation upon which every Malaysian company is created, governed, and operated. It regulates the structure, management, and accountability of business entities from private limited companies (Sdn. Bhd.) to public listed corporations (Bhd.).

At its core, the framework ensures that every company operates in compliance with the law, protects the interests of shareholders and stakeholders, and upholds transparency, fairness, and integrity in business conduct.

Statutory Foundation

The primary legislation governing corporate entities in Malaysia is the Companies Act 2016 (Act 777) (“CA 2016”), which replaced the Companies Act 1965. It provides the comprehensive legal regime for:

Formation and Structure of Companies

Under Part II of the Companies Act 2016, a company may be formed by a single member or director, reflecting Malaysia’s modernised approach to entrepreneurship and small business facilitation.

  • Private Limited (Sendirian Berhad / Sdn. Bhd.) – restricted share transfer, limited to 50 shareholders;
  • Public Limited (Berhad / Bhd.) – may offer shares to the public;
  • Company Limited by Guarantee – commonly used for non-profit or charitable purposes.

Upon incorporation, the company becomes a separate legal entity, distinct from its members, as established in Salomon v A. Salomon & Co Ltd [1897] AC 22, a principle adopted in Malaysia and reinforced by Malaysian courts.

Duties and Liabilities of Directors

Directors occupy a fiduciary position, bound by statutory and common law duties. Under Sections 213–218 CA 2016, directors must:

  • Act in good faith, in the best interests of the company;
  • Exercise reasonable care, skill, and diligence;
  • Avoid conflicts of interest; and
  • Disclose any related party transactions or benefits.

Breach of these duties can result in civil and criminal liability, including disqualification and personal compensation orders. Malaysian courts have consistently enforced these principles, holding directors accountable for misuse of corporate assets and failure of oversight (see: Tengku Dato’ Ibrahim Petra v Petra Perdana Bhd [2018] 3 MLJ 1)

Shareholder Rights and Remedies

The Companies Act 2016 provides several safeguards for shareholders, especially minorities, including:

  • Derivative Actions (s. 210–216) – allowing shareholders to bring actions on behalf of the company for wrongs done to it;
  • Oppression Remedies (s. 346) – protecting shareholders from unfair prejudice or exclusion from management;
  • Inspection of Registers and Financial Statements – ensuring transparency and accountability; and
  • Voting and Meeting Rights – providing mechanisms for participation in corporate decision-making.

The doctrine of majority rule, established in Foss v Harbottle (1843) 2 Hare 461, remains foundational, balanced by statutory rights that prevent abuse of majority power.

Corporate Governance and Compliance

Corporate governance in Malaysia emphasises transparency, accountability, and ethical leadership. Listed companies are required to adhere to the Malaysian Code on Corporate Governance (MCCG), which promotes:

  • Independence and diversity on boards;
  • Proper risk management and internal control systems;
  • Sustainability and ESG (Environmental, Social, Governance) reporting.

Non-compliance can attract regulatory sanctions by the Securities Commission and reputational risk, as seen in enforcement actions against directors and issuers for breach of fiduciary and disclosure obligations.

Corporate Finance, Mergers, and Acquisitions

The corporate law regime also governs capital raising, mergers, and restructuring.

Key areas include:

  • Issuance of Shares and Debt Instruments – compliance with Part III CA 2016 and SC guidelines;
  • Mergers, Acquisitions, and Takeovers – regulated by the Capital Markets and Services Act 2007 (CMSA) and Malaysian Code on Takeovers and Mergers 2016;
  • Corporate Restructuring – including schemes of arrangement under Sections 366–373 CA 2016, allowing financially distressed companies to restructure liabilities with creditor approval.

Cross-border M&A transactions also engage competition law under the Competition Act 2010 and foreign investment rules under MIDA and Bank Negara Malaysia frameworks.

Corporate Insolvency and Liquidation

When companies face financial distress, the law provides mechanisms for:

  • Voluntary and compulsory winding up (Part IV, CA 2016);
  • Judicial management under Sections 404–430, offering temporary protection to rehabilitate the company;
  • Receivership and liquidation procedures ensuring fair asset distribution.

The Insolvency (Amendment) Act 2020 further modernised insolvency law, introducing flexibility in debt restructuring and creditor arrangements.

Evolving Trends in Corporate Law

Malaysia’s corporate landscape continues to evolve with:

  • Growing emphasis on ESG compliance and sustainability reporting;
  • Increased digitalisation and fintech regulation, including e-meetings and electronic filings under SSM;
  • Stricter enforcement on anti-money laundering (AMLA) and beneficial ownership disclosure;
  • Cross-border corporate governance harmonisation within ASEAN.

The future of corporate law is one of transparency, technology, and trust aligning Malaysian corporate practices with global standards.

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