The proposed Act would tighten rules on setting up new companies, approving investments and loans, and raise the accountability of boards and management.
KUALA LUMPUR: The Ministry of Finance (MOF) is finalising a proposal to enact the Statutory Bodies and Controlled Entities (Financial Governance) Act to strengthen the governance of government-owned companies.
The ministry said the proposal is expected to impose stricter procedures for the establishment of new companies, strengthen mechanisms for approving investments and loans, and increase the accountability of boards of directors and management.
“The Act aims to ensure that corporate decisions are made prudently, transparently and responsibly,” it said.
MOF said this in a written reply to a question from Azli Yusof (PH-Shah Alam) on measures taken to improve governance following audit reports on leakages of public funds.
In addition to legislative reforms, the ministry said the government is also strengthening compliance with regulations regarding bonus payments and procurement by Federal Statutory Bodies to ensure these matters take into account performance, financial capacity, and the government’s interests.
“The government will also clarify and streamline the jurisdictions for relevant agencies to reduce overlapping functions, close oversight gaps and ensure that monitoring and follow-ups are carried out in a more structured, consistent and effective manner,” it said.
