The EDGE Malaysia Billion Ringgit Club Gala Dinner 2010
1. Thank you for inviting me to The Edge Billion Ringgit Club Awards ceremony this evening. While we celebrate the successes and achievements of Malaysia’s biggest and best listed companies tonight we cannot afford to be complacent. The global recovery is still fragile. The debt crisis in Europe and the volatility in global capital markets is a stark reminder of the challenges that lie ahead.
2. Malaysia has turned the corner and the 10.1 per cent Gross Domestic Growth recorded in the first quarter of this year shows that we are back on the road of economic growth. All indicators point to a healthy GDP growth in 2010. I am determined to ensure that the Malaysian economy remains on this growth path and it should gather momentum and remain robust for us to achieve the goals that we have set ourselves – to move into the ranks of a high income economy and to be a developed nation by 2020.
3. The Malaysian stock market has come a long way. From 262 companies listed on the exchange in 1973, the number had risen to 962 as at 31 March 2010, with a market capitalisation of RM1.044 trillion. With further strengthening of the economy, sustained and broad based economic growth and increased investor confidence, many more companies, both local and foreign, are seeking to list on Bursa Malaysia. Up to June this year, 12 new companies were listed compared with 14 for the whole of last year.
4. Even though the Malaysian stock market is not immune to the adverse and volatile developments in the more developed capital markets, the Malaysian bourse, like the broader economy has remained resilient. With increased competition from new and emerging markets, concerted efforts are needed to remain competitive and be more efficient to attract the discerning investor – both locally and from abroad.
5. Although Bursa Malaysia may not be the largest in the region in terms of market capitalization, but with 962 listings it has the largest number of listed companies. In comparison, as at 31 March this year, the number of companies listed on the Singapore Exchange totaled 761 and on the Indonesia Stock Exchange 401 companies were listed. Bursa Malaysia also offers a wider and diversified portfolio to the investing public.
6. This reflects the diversity of the Malaysian economy and of the corporate sector. It is also testimony of the government’s diversification efforts which have helped transform the economy from one based on agriculture to one that is driven by manufacturing and the services sectors. But this is not the end of the journey in the nation’s economic development, it is in fact the beginning of the next phase, more challenging arguably, to reach the pinnacle by joining the rank of developed nation
Ladies and Gentlemen,
7. Malaysia needs a new approach, we need a new enthusiasm, we need new determination to propel the economy into the next level of high growth. The New Economic Model and the Tenth Malaysia Plan chart Malaysia’s development in the years ahead which is premised on high income, inclusiveness and sustainability. While the plan outlines strategies for a more focused role for the government as an enabler, regulator and catalyst, it is important and this where the emphasis of the New Economic Model and the 10th Plan is to shift the onus now for the private sector to step up its role as the true engine of growth. A strong, vibrant, competitive, dynamic and innovative corporate sector is crucial for Malaysia’s economic and social well-being.
8. The private sector must be a partner in national development. The government can act as a facilitator, we must provide incentives, we must create an environment conducive for business, we must make it easier for business to take place but alternately it is the private sector and entrepreneurs who must take advantage of the incentives to create employment, enhance value of their businesses, generate revenue and contribute to national development.
9. In today’s inter-dependent and globalised economy, there is increased focus on the operations and behaviour of management. Shareholders are better educated on their rights, demand greater transparency, accountability and corporate governance. Management is under intense pressure to be highly competitive, efficient, to increase productivity and generate higher revenues for the corporation and provide better returns to the shareholders including better products and enhanced services to consumers.
10. It is not an easy task and it is not made any easier by the vagaries of the marketplace. Even as the government pushes the private sector to take on the task as the engine of growth, it recognizes the important contributions of the corporate sector. And in this regard I am pleased that a private sector organization The Edge with its Billion Ringgit Club Awards pays tribute to the largest and the best performing companies.
Ladies and Gentlemen,
11. The Edge Billion Ringgit Club evaluates companies from various spectrums – from size, profitability and shareholder returns to corporate social responsibility. The awards honour companies on the basis of their performance in terms of gains in market capitalisation, growth in profits and return on equity.
12. Despite the difficult stock market environment, the number of companies that qualified to be included in the Billion Ringgit Club is heartening – a total of 163 or 17 per cent of all listed companies on Bursa Malaysia qualified to be on this prestigious list. And I hope the list will get longer and longer.
13. Equally encouraging is the range of industries represented. From government-linked conglomerates and banking groups to niche manufacturing players in specialized fields, the list represents the diversity of Malaysia’s corporate sector and indeed the nation’s economy.
14. A number of Malaysian companies in the Billion Ringgit Club are global players and have done well in the competitive external markets. They have popularized Malaysian brands abroad and carved out a reputation for themselves in construction, banking and finance, Information technology and mining.
15. For Malaysia to succeed in a competitive, globalised hostile external environment, businesses needless to say must be efficient. Industries must move up the value chain and management must be transparent, accountable and socially responsible. Corporate leaders cannot be satisfied with the status quo, there must be continuous quest for improvement in efficiency, competitiveness and corporate governance.
16. As Malaysia strives to move up the development ladder, it is essential that the private sector leads in the march towards efficiency, creating value for employees, shareholders, consumers, customers and society at large.The Billion Ringgit Club members can and should lead the way by setting standards with adoption of corporate best practices, increased corporate governance, transparency and increased productivity.
17. The creation of this Club for companies with at least One billion Ringgit in revenue or market capitalisation will serve to encourage smaller Malaysian companies to strive harder. It will also encourage and prompt management to work harder if they want their companies to be members of this exclusive club.
18. I would like to conclude by offering my congratulations to members of the Malaysian Billion Ringgit Club.