Today, Bursa Malaysia is one of the largest bourses in Asia with just under 1000 listed companies offering a wide range of investment choices to the world. Bursa Malaysia operates as a fully integrated exchange, offering the full range of Exchange-related services including clearing, trading, settlement and depository services. In 1930, the first formal securities business organization in Malaysia, Singapore Stockbrokers' Association was established and it was re-registered as the Malayan Stockbrokers' Association in 1937. In 1960, the Malayan Stock Exchange was established and the public trading of shares commenced. Direct telephone lines linked the board system had trading rooms in Singapore and Kuala Lumpur.
The Stock Exchange of Malaysia was established in 1964. In 1965, the Stock Exchange of Malaysia became known as the Stock Exchange of Malaysia and Singapore with the secession of Singapore from Malaysia. The Stock Exchange of Malaysia and Singapore was divided into the Kuala Lumpur Stock Exchange Berhad and Stock Exchange of Singapore due to the ceased of currency interchangeability between Malaysia and Singapore in 1973. The operation of the Kuala Lumpur Stock Exchange Berhad was taken over by the Kuala Lumpur Stock Exchange which was incorporated on December 14, 1976 as a company limited by guarantee.
The name Bursa Malaysia Berhad changed on April 14, 2004. The purpose was to enhance their competitive position and to respond to global trends in the exchange sector by making them more customer-driven and market-oriented. They are focused on various initiatives aimed at improving our product and service offerings, increasing the liquidity and velocity of their markets, improving the efficiency of the businesses and achieving economies of scale in their operations.
On 18 March 2005, Bursa Malaysia was listed on the Main Board of Bursa Malaysia Securities Berhad with a 17% or RM0.50 premium over its retail price of RM3.00. On 5 October 2007, they accomplished double achievements when the exchange received certifications for the conformance to the ISO 9001 : 2000 Quality Management System and ISO 14001 : 2004 Environmental Management System standards. As of 31 December 2007, Bursa Malaysia had 986 listed companies with a combined market capitalization of $325billion.
Bursa Trade Securities, a new trading platform launched in December 2008 enables faster processing and execution of orders and provides wider trading functions and features. Bursa Trade Securities followed on from the implementation of Bursa Trade Derivatives two years earlier.
2.2 Organization Structure
Organizational structure is the formal system of task and reporting relationships that controls, coordinates, and motivates employees so that they cooperate to achieve an organization's goals. Besides, it encourages employees to work hard and to develop supportive work attitudes and allows people and groups to cooperate and work together effectively.
Dato' Yusli Mohamed Yusoff, aged 50, is the Chief Executive Officer of Bursa Malaysia. He was appointed to the post by the Malaysian Finance Minister on March 1, 2004, and elected as an Executive Director on April 10, 2004. He was the Chief Executive Director of CIMB Securities from the year 2000 to year 2004. Furthermore, he served as Chairman of the Association of Stock Broking Companies Malaysia from year 2003-2004. He is a Malaysian graduated with a Bachelor of Economics from the University of Essex (United Kingdom) in 1981. Besides, he s a member of the Institute of Chartered Accountants, England & Wales (ICAEW), the Malaysian Institute of Accountants (MIA), the Malaysian Institute of Certified Public Accountants (MICPA) and Honorary Member of the Institute of Internal Auditors Malaysia (IIAM).
The Head, Group Internal Audit which include Chief Operating Officer, Chief Information Officer, Bursa Malaysia Derivatives CEO, Chief Market Operations Officer, Chief Group Human Resources Officer, Chief Financial Officer and Chief Regulatory Officer. Those positions are all who are professionals and have a well knowledge in the field. The COO still in vacant because of the resign of Omar Merican on June 2010. Lim Jit Jee had appointed as the CIO of Bursa Malaysia effective on September 15, 2008 who will head the Technology Group. He has more than 20 years experience in the securities industry. Chong Kim Seng, aged 51, the Bursa Malaysia Derivatives CEO graduated with a Bachelor of Science degree from the National University of Singapore in 1983. The CMOO, Devanesan Evanson is a Fellow of the ACCA and a member of the MIA and appointed as CMOO effective 1 January 2008.
Siti Aishah Md Lassim joined Bursa Malaysia as CHRO on 3 November 2008 and brings with her more than 18 years of experience in diverse fields which include management consulting, technology and human resources. The CFO, Nadzirah Abd Rashid a Malaysian graduated with a Bachelor of Arts in Accountancy from the University of South Australia. She has more than 20 years of experience in the banking and finance sector. Last, Selvarany Rasiah, the CRO with aged 44, a Malaysian graduated with a Bachelor of Laws degree from the University of Malaya and has admitted as an Advocate and Solicitor of the High Court of Malaya.
2.3 Regulatory Structure
Bursa Malaysia acts as the frontline regulator of the Malaysian capital market and has the responsibilities to ensure a fair and orderly market in the securities and derivatives that are traded through its facilities. The regulatory functions are performed and managed by Regulation Functional Group. Thus, the Chief Regulatory Officer plays an important role in provides the Board with a regulatory report on a regular basis and the regulatory plan which includes the regulatory budget is approved by the Board.
Furthermore, as an integrated exchange, Bursa Malaysia also has the duty to ensure orderly dealings in the securities deposited with Bursa Malaysia, and orderly, clear and efficient clearing and settlement arrangements for transactions cleared and settled through its facilities. Thus, Bursa Malaysia has put in place a comprehensive and effective regulatory and supervise framework to regulate the market and its participants, including the listed issuers and their directors and advisers, Participating Organizations, Trading Participants, Clearing Participants, Authorised Depository Agents and Authorised Direct Members. The Capital Market is governed by such Acts of Parliament including Capital Markets and Services Act 2007, Securities Industry (Central Depositories Act) 1991, Securities Commission Act 1993, Companies Act 1965, Offshore Companies Act 1990 and Labuan Offshore Securities Industry Act 1995.
Bursa Malaysia overriding objectives, in addition to discharging its statutory duties are investor protection, transparency, high standards of conduct and governance, market integrity and that all relevant person can participate in the market with confidence. So, Bursa Malaysia has issued various sets of rules to stipulate the requirements that need to be met by the regulated entities either upon admission and or on a continuing basis. It administers and monitors compliance with these rules and takes strict, prompt and objective enforcement action for breaches of these rules. Besides, Bursa Malaysia actively supervises the listed issuers and the brokers. It also undertakes surveillance over the trading activities in the marketplace.
2.4 Corporate Governance
Corporate governance is the process and structure used to direct and manage the business and affairs of the company towards enhancing business prosperity and corporate accountability with the ultimate objective of realizing long term shareholder value, whilst taking account the interests of other stakeholders. This indicates that corporate governance is not only applied to the shareholders but the other stakeholders as well.
Bursa Malaysia adheres to high standards of corporate governance practices under the leadership of the Board, as guided by the Malaysian Code of Corporate Governance (CODE) which was revised on 1 October 2007. The statement is made in compliance with paragraph 15.26 of the Listing Requirements of Bursa Malaysia Securities Berhad (LR). It includes Memorandum & Articles of Association, Governance Model, Term of Reference and Code of Ethics.
Memorandum & Articles of Association states all the objectives of Bursa Malaysia and the information in the company. This let the stakeholders and the shareholders know all the rules and their own responsibilities. Governance Model states the roles and the responsibilities of the board and each arises out of a different relationship between board members and a staff member. Besides, Term of Reference give references to board of directors, governance committees, consultative panels, and committees established pursuant to LOSIA, management committees and regulatory committees. Code of Ethics serves to assist in defining the ethical standards and conduct at work required at Bursa Malaysia. This Code is to be interpreted within the framework of the laws and customs of Malaysia besides being read in line with Bursa Malaysia's directives, guidelines and policies, as issued from time to time.
