Reviving Shareholders’ Participation in Companies’ Decision-Making in Malaysia
Nor Hayati Abdul Samat
School of Law, UUM-COLGIS, Universiti Utara Malaysia
Hasani Mohd. Ali
Faculty of Law, Universiti Kebangsaan Malaysia
In theory, a general meeting of shareholders and a meeting of the board of directors are equal in terms of their roles and significance for a company. After the occurrence of a series of corporate collapses, shareholders are urged to be more active in providing the company’s management with a check and balance mechanism. By employing a traditional approach of legal research, this paper discusses two continuous efforts aimed at enhancing shareholders’ opportunity to participate in the company’s decision-making. This paper finds that in reality, shareholders have always been overshadowed by company directors in terms of participation in the company’s decision-making. There is also lack of interest among shareholders to participate in the company’s general meetings. This paper recommends for the issues to be approached by addressing two possible avenues. First, by strengthening the legal framework in respect of general meetings especially by resolving legal issues relating to electronic communication, proxy voting, and management review. The second avenue is through shareholders’ activism and empowering minority shareholders. This discussion is based on the Malaysian corporate landscape.
Keywords: Electronic meetings, Management review, Minority shareholders