…………..the Board of Directors and CEO of 1MDB and SRC are equally guilty and should be held responsible for the theft of billions of public funds in both entities?
In the trial against former PM, Datuk Seri Najib Razak, the board of directors and executive management of both companies were largely characterized in court as having been manipulated by, or having acted under the instructions of, Najib and his agent, Jho Low.
The board of directors and executive management cannot evade responsibility by claiming they were "taking instructions" aligns with fundamental principles of corporate governance and legal fiduciary duties.
Under the Companies Act 2016, directors in Malaysia cannot evade liability simply by claiming they were taking instructions from shareholders.
Even if those directors were appointed as a representative of the Ministry of Finance (MOF), the ultimate shareholder for both companies, those directors must put the company’s interests ahead of their appointer, i.e MOF in those instances.
The law places the primary duty of care and loyalty on the directors to act in the best interests of the company itself, not just its members.
The Board of Directors (BOD) are mandated to act in the best interest of the company, and this responsibility is non-delegable and cannot be excused by subordinate status to shareholders, a parent company, or a dominant CEO and in the above 2 companies, that they are taking instructions from Datuk Seri Najib Razak and his agent, Jho Low.
Section 211 of the CA 2016 specifies that the business and affairs of the company shall be managed or under the direction of the board of directors and that the directors have all the powers necessary for managing, directing and supervising the management of the company.
To be able to do this, the director must be diligent and careful in performing the duties that have been entrusted with him/her.
A director must also exercise reasonable care and skill expected of a person of his experience and be diligent in managing the company's affairs.
Directors cannot passively take instructions.
They must exercise independent judgment, skill, and diligence.
A director who is passive by not being involved in the company's management may have breached his duty of care, skill and diligence.
Based on how they characterised their role as a member of the Board of Directors, it appears that all the directors in both 1MDB and SRC have breached the duty of care expected of them.
"Taking Instructions" is NOT a Valid Excuse to exclude them from facing legal actions.
In corporate law, claiming to be "just following orders" is not a defense against breach of duty, especially in cases involving fraud, self-dealing, or insolvency.
A director appointed by a specific shareholder or a parent company must still act in the best interests of the company they sit on, not just their nominator.
In cases involving corruption, money laundering, or illegal acts under the MACC Act 2009, directors are directly accountable, regardless of whether they "instructed" the act directly or it was done by management.
Questions should be asked of all the Directors in both 1MDB and SRC on whether did they, at that time when they were in the BOD in 1MDB and SRC, believed the instructions they `claimed’ given by Datuk Sri Najib and his agent, Jho Low were contrary to the law?
If yes, why did they approve and executes it knowing it was against the law?
Knowing that the action is illegal and yet they still approve it does not negate the protection afforded to them.
On the contrary, if they approved those transactions for the reasons that they believed the instructions were legal, then their excuse that they were just taking instructions from Datuk Sri Najib becomes untenable.
The BOD can’t offer the excuse that `you don’t say NO to the Prime Minister who is also the Finance Minister and the ultimate shareholder of both 1MDB and SRC.
If the instructions were contrary to the law, the BOD can refuse to carry out the instruction by resigning from their positions.
Yet, they did not.
Instead, they willingly went ahead and carry out the instructions issued by Datuk Sri Najib and his agents.
Dear PMX, you have been screaming on top of your lungs that you remained committed in your fight against corruption in this country.
Start by charging every of the Directors in the BOD of 1MDB and SRC for their role and complicity in the theft of public funds in both entities.
This will also give a clear warning to all those existing and future nominees directors that they will face the music in their personal capacity if they take instructions blindly from their political masters and hopefully force future potential nominees to think twice before accepting appointments proposed by their political masters.
Each of us have choices including every of the individual directors in 1MDB and SRC.
Those individual directors refused to take the ethical and moral way in making their decisions.
Probably the emoluments and perks are just too enticing for them to walk away.
They can always say NO and resign from the BOD but they choose to stay and continued.
Dear PMX, if your government does not take action and charge all these individual directors, you are sending a wrong and immoral signal not only to every Malaysian but also to the international investing community that crime and financial fraud is well rewarded in Malaysia.
Just like all those who were in the BOD in both 1MDB and SRC, basking in the ill gotten gains and fees and perks they obtained courtesy of all the ordinary Malaysians.
It is your decision whether you wish to correct this prevalent optic now.
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