Source from (The Sun Daily): http://www.thesundaily.my/news/695099
Published: May 13, 2013
"It is imperative for companies, whether big or small, to adopt good CG and increase transparency and accountability as such steps will reflect on their bottomline," he told SunBiz in an interview.
"However, due to their scale, most SMEs think it's not necessary for them to adopt the principles of governance and that their resources would go waste if they do.
"Thus, we are stressing that a company, no matter how small, if they have everything in place that entails good governance, then it is going to improve their company's performance," said Mohd Tap.
With a good corporate governance policy, staff of the company will be conscious that they have to abide by certain values and serves to deter them from pocketing items when conducting business on behalf of their company.
"Corruption is cost, and it's not part of the business cost. If you have to pay bribes to get your business going, it's a cost to the company. It might cost you, for example, 10% more when undertaking a project.
"If your staff is not involved in any hanky-panky, there won't be unnecessary payments, and this would also help to retain the reputation of the company," he added.
On its part, IIM will continue to focus on helping state government-linked companies (GLCs) become more transparent, accountable and encourage them to adopt corporate governance this year.
"For the past one year, we've talked to seven state GLCs and we're going to pursue the others. At the same time, we're going to revisit some GLCs and work with them on how to improve their integrity," said Mohd Tap.
IIM is also in the progress of conducting its corporate integrity officer programme and the first batch that has been trained at the Malaysia Anti-Corruption Academy is now serving as chief integrity officers in a few companies.
"We're encouraging organisations, especially listed companies as well as those in the private sector to put in place corporate integrity officers. These officers' job encompasses a bigger perspective than internal audit."
The second batch is now undergoing the programme and each group takes six months to be trained.
"Hopefully with these corporate integrity officers, it's going to complement and supplement the compliance officers that companies have nowadays.
"Having these officers is not a waste of resources. Anything that you can do to improve the company's image such as putting in place structures to make sure things are transparent and accountable is always good for the company.
"At the end of the day, most of the companies that have good governance make more profit than companies who don't," said Mohd Tap.
Since the launch of the Corporate Integrity Pledge in 2011, 250 companies have signed up for the document that allows a company to make a commitment to uphold the Anti-Corruption Principles for Corporations in Malaysia.
By signing the pledge, a company is making a unilateral declaration that it will not commit corrupt acts, will work toward creating a business environment that is free from corruption and will uphold the Anti-Corruption Principles for Corporations in Malaysia in the conduct of its business and in its interactions with its business partners and the government.
Mohd Tap said even though the pledge is a voluntary tool to aid companies recognise the importance of anti-corruption measures, many organisations, state GLCs and multinational corporations (MNCs) have given their commitment to it.
"The consciousness for companies to be at certain level of integrity, accountability or transparency runs in the corporate sector in Malaysia.
"However, what is most important is what you do after making the pledge. The moment you tell the world that you will not be involved in corruption, you have to live up to that reputation… and how best to put in place an infrastructure within the organisation to live up to the pledge."
This pledge is a result of collaboration between Bursa Malaysia Bhd, the Companies Commission of Malaysia, IIM, the Malaysian Anti-Corruption Commission and NKRA Corruption Monitoring & Coordination Division, the Securities Commission, Transparency International Malaysia and the Performance Management and Delivery Unit.
Mohd Tap also said Malaysia's corporate sector has improved in terms of integrity in the workplace in the past few years, which is evident from IIM's yearly survey.
In addition, positive findings from six to seven international surveys have also showed that Malaysia has improved in terms of the economic or corporate sectors.
Malaysia ranked 12th in the World Bank's Doing Business 2013 out of 185 economies, up from 18th spot last year. In the IMD World Competitiveness Yearbook 2012, Malaysia moved up to the 14th position out of 59 competitive countries, from 16th in 2011.
"Many Malaysian companies are now present in the international marketplace. If a company wants to expand outside Malaysia, even within Asean, one of the things necessary is to have integrity in our business dealings," said Mohd Tap.
He cited Mass Rapid Transit Corp Sdn Bhd, the developer and asset owner of the MRT project, which has signed the Corporate Integrity Pledge.
"Every time they open their tenders, it ensures that regulations and procedures are put in place and at every stage of it."
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