KUCHING: Bank Negara Malaysia (BNM) is calling on financial institutions to adopt a code of ethics and promote ethical behaviour supported by a transparent whistleblowing policy as it seeks to improve the standard of corporate governance within Malaysia.
The call is part of a six-point requirement it released on Wednesday highlighting the need for good governance standards in financial institutions in order to maintain public confidence in the financial system.
Other key changes introduced include strengthed requirements on board composition, enhanced expectations for the board and its committees, expanded requirements on renumeration arrangements which promote a sound risk culture, and stregthened expectation for effective group-wide governance arrangements.
The changes did not focus solely on board structure changes but also changes that would influence financial institutions as a whole from the top to bottom.
The effects of these changes look promising as BNM has said that the aforementioned standards will take effect immediately, subject to a transition period for certain requirements.