FOREWORD BY THE GOVERNOR
AND PATRON OF FIDE FORUM

The landscape in which the Malaysian financial sector operates is in the midst of a significant transformation, driven by domestic and international developments. The future of the financial industry will be shaped by the decisions being taken today. In this regard, directors of the Malaysian financial industry have an important role in preparing and steering our financial institutions towards future opportunities and long-term sustainability that will contribute to the long-term economic growth of the country.

In the recent global financial crisis, failure in corporate governance was identified as one of the main contributing factors to the damaging consequences that is still being felt. But this is far from new. Time and again, experience has shown that the many cases of corporate failure stem from weaknesses in oversight and control. Many lessons can be drawn from the corporate governance practices in all these episodes. Serious and earnest consideration of these practices will contribute towards minimising the risks and costs of future crises.

In our domestic environment, Malaysia has undergone reforms in corporate governance in this recent decade. There have been key improvements in the practices of boards, with directors now having a more active role in ensuring the implementation of risk policies, business strategies and capital management. There are also more independent directors represented on the boards of financial institutions, and greater attention is accorded by nomination committees to increase the diversity on the board and to ensure a balanced mix of experience and expertise.

There are a number of areas in domestic corporate governance that still warrant continued attention and enhancement. This concerns ensuring that the directors selected for the board are able to provide objective and independent judgement. Second, while the daily operations of financial institutions is the responsibility of senior management, the board of directors have an important role to exercise oversight to ensure that the actions taken by management is in line with the institutions’ strategic plans and are within the risk parameters endorsed by the board. Finally, the board also has a key role in overseeing the remuneration or incentive systems to ensure that they support the long-term viability of the financial institution. In all these areas, the FIDE programme has proven, and will continue to be, invaluable.

It is my pleasure to launch the FIDE Forum, which symbolises the next step in the journey for the directors of Malaysia’s financial institutions who have completed the FIDE core programme. It also marks a great milestone in our efforts to enhance corporate governance practice in the Malaysian financial sector. Since its inception in 2008, the FIDE programme has contributed towards the high standards of corporate governance in the financial industry. The establishment of the FIDE Forum will build on the directors’ networks and enable FIDE alumni members to become leading influencers of governance practices and thought leaders within financial institutions.

I would like to take this opportunity to express my appreciation and congratulations to the directors and members of the FIDE Forum who contributed towards its formation. I have every confidence that the financial sector will benefit greatly from the events and efforts that will follow.

TAN SRI DATO’ SRI DR ZETI AKHTAR AZIZ