WHILE Berjaya Corp Bhd (BCorp) scored highly on the diversity score chart with eight women directors on its board (57%), the total line-up of 14 board members is an equivalent of a football team with three substitutes.
Well, far exceeding the 30% recommended percentage under the Malaysian Code on Corporate Governance (MCCG) is one thing – having an effective board which is able to articulate both the interest of the management and investors is obviously another.
“A typical public listed company (PL) board comprises six directors,” the Minority Shareholders Watch Group CEO Devanesan Evanson told FocusM.
“There is one company which has three directors while another company has 15 directors. As such, a board size of 14 members is veers towards what may be considered as a larger board.”
On Monday (May 31), BCorp appointed three women directors, namely Datin Seri Sunita Mei-Lin Rajakumar, Datuk Leong Kwei Chun, JP @ Datuk Anne Eu and Norlela Baharudin to its board.
The will join five other existing women directors comprising Nerine Tan Sheik Ping, Datuk Seri Zurainah Binti Musa and Vivienne Cheng Chi Fan (all are executive directors), Dr Jayanti Naidu G. Danasamy and Penelope Gan Paik Ling (both are independent non-executive directors [INEDs]).
Devanesan further elaborated that it rests with the nomination committee to recommend to the board on what it thinks is an ideal board size according to the dynamics of their circumstances.
“The board will then – as an act of self-evaluation – decide on the board size,” he explained.
“The nomination committee will, among others, utilise a skills-matrix approach to ascertain whether they have the requisite skills and diversity on-board to discharge their fiduciary duties.”
The right board-size, according to Devanesan, will provide better deliberations that consider diverse perspectives which result in better decisions.
“Bigger board by itself is not necessarily a boon to minority shareholders as there is a risk that the board may become dysfunctional,” he opined. “There is no ‘one size fits all’ when it comes to board sizes. Each company must cut its cloth according to its size.”
At 4.22pm, BCorp was down 0.5 sen or 1.69% to 29 sen with 14.49 million shares traded, thus valuing the company at RM1.55 bil. – June 3, 2021
