MICG was established in March 1998 by the High Level Finance Committee on Corporate Governance. It is a non-profit public company limited by guarantee, with founding members consisting of the Federation of Public Listed Companies (FPLC), Malaysian institute of Accountants (MIA), Malaysian Association of Certified Public Accountants (MICPA), Malaysian institute of Chartered Secretaries and Administrators (MAICSA), and Malaysian Institute of Directors (MID).

MICG’s mandate was to raise the awareness and practice of good corporate governance in Malaysia. MICG was given a start-up capital of RM50,000 and later in 1999 was given a contribution of RM79,000 from the Registrar of Companies. Other than these monies, MICG had been operating on revenues from its programmes and private donations ever since. MICG usually runs a balanced budget every year, thus there are usually very little surplus funds to bring forward to the next year.

The Report on Corporate Governance published by the High Level Finance Committee on March 1999 has stipulated MICG as ‘The Recognized Corporate Governance Training Centre’ (CGTC). Bursa Malaysia Berhad (formerly known as Kuala Lumpur Stock Exchange) also partake in the effort of enhancing corporate governance in Malaysia by revamping its’ Listing Requirements. For instance, Chapter 15 of the Revamped Listing Requirements address issues on corporate governance and one of the paramount requirement spells out that a listed issuer must ensure that its board of directors make the following statements in relation to its compliance with the Malaysian Code on Corporate Governance in its annual report: -

a) a narrative statement of how the listed issuer has applied the principles set out in Part 1 of the Malaysian Code on Corporate Governance to their particular circumstances; and

b)a statement on the extent of compliance with the Best Practices in Corporate Governance set out in Part 2 of the Malaysian Code on Corporate Governance which statement shall specifically identify and give reasons for any areas of non-compliance with Part 2 and the alternatives to the Best Practices adopted by the listed issuer, if any.

The requirement was aimed towards regulating companies to be more transparent and accountable in their actions in order to gain investors’ confidence. It is hoped that this would reduce the effects of the agency theory and signalling theory, thus paving the way for a more efficient capital market. Indirectly, it also envisaged that these efforts would in turn boost the country’s economic growth as well as encouraging inflow of foreign direct investments.

In other words, good corporate governance is the key to a robust and competitive corporate sector, which serves as a source for sustainable economic growth.