Malaysia’s Company Director’s Role and Responsibilities


This Code of Ethics is formulated to enhance the standard of corporate governance and corporate behavior with the intention of achieving the following aims:


a. To establish a standard of ethical behavior for directors based on trustworthiness and values that can be accepted, are held or upheld by any one person.


b. To uphold the spirit of responsibility and social responsibility in line with the legislation, regulations and guidelines for administrating a company.



In the context of this code, a company director means any person who holds the position of director in a corporation irrespective of any designation used, including anyone who follows the directives and advice of a corporate director and who usually takes action, as well as an in-turn or substitute director. A director also includes both executive and non-executive directors as well as executive and non-executive chairpersons.

Director’s Role and Responsibilities in PDF Version: HC Director Responsibilities Director X1


a. Section 214: To make business judgement;

b. Section 215: To rely on information from professional’s report;

c. Section 216: To delegate power and be responsible from delegatee;

d. Section 217: Nominee director to act in the Company’s best interest;

e. Section 218: Prohibition of personal gains nor interest from the post of director;

f. Section 218: To make disclosure towards respective shareholders;

g. Section 223: Disposal or acquisition of undertaking of properties;

h. Section 245: To keep and manage accounting and other records;

i. Section 248: To prepare financial statement and directors’ report (Section 252);

j. Section 213 (1): Proper purpose and acting in good faith;

k. Section 213 (2): To execute care, skills and diligence.


In the performance of his duties, a director should at all times observe the following codes of Corporate Governance:

a. Should have a clear understanding of the aims and purpose, capabilities and capacity of the company;

b. Should devote time and effort to attend meetings and to know what is required of the board and each of its directors, and to discharge those functions;

c. Should ensure at all times that the company is properly managed and effectively controlled;

d. Should stay abreast of the affairs of the company and be kept informed of the company’s compliance with the relevant legislation and contractual requirements;

e. Should insist on being kept informed on all matters of importance to the company in order to be effective in corporate management;

f. Should limit his directorship of companies to a number in which he can best devote his time and effectiveness; each director is his own judge of his abilities and how best to manage his time effectively in the company in which he holds directorship;

g. Should have access to the advice and services of the company secretary, who is responsible to the board to ensure proper procedures, rules and regulations are complied with;

h. Should at all times exercise his powers for the purposes they were conferred, for the benefit and prosperity of the company;

i. Should disclose immediately all contractual interests whether directly or indirectly with the company;

j. Should neither divert to his own advantage any business opportunity that the company is pursuing, nor may he use confidential information obtained by reason of his office for his own advantage or that of others;

k. Should at all times act with utmost good faith towards the company in any transaction and to act honestly and responsibly in the exercise of his powers in discharging his duties;

l. Should be willing to exercise independent judgment and, if necessary, openly oppose if the vital interest of the company is at stake;

m. Relationship with Shareholders, Employees, Creditors and Customers;

n. Should be conscious of the interest of shareholders, employees, creditors and customers of the company;

o. Should at all times promote professionalism and improve the competency of management and employees; 

p. Should ensure adequate safety measures and provide proper protection to workers and employees at the workplace;

q. Social Responsibilities and the Environment;

r. Should ensure that necessary steps are taken in accordance with the law to properly wind-up or strike off the company register if the company has not commenced business or has ceased to carry on business and is not likely to commence business in the future or resume business as the case may be;

s. Should adopt an objective and positive attitude and give the utmost cooperation for the common good when dealing with government authorities or regulatory bodies;

t. Should ensure the effective use of natural resources, and improve quality of life by promoting corporate social responsibilities;

u. Should be more proactive to the needs of the community and to assist in society-related programmes in line with the aspirations of the concept of ‘Caring Society’ in Vision 2020; 


v. Should ensure that the activities and the operations of the company do not harm the interest and well-being of society at large and assist in the fight against inflation.


1. The article is written for general understanding and do connect with your COSEC for further information.

2. The Sun Daily (07th Oct 2014) Directors – Beware of your tax responsibilities

Sun 1

3. Director of the Company to practice diligence at all time:


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