Investor’s rights (Part 1): The Right to Voice Opinions

As a general rule, you as a shareholder do not normally have the right to be directly involved in the running of a company. However, shareholders can still protect the integrity of their investment and indirectly influence corporate decisions by engaging in active dialogue with the directors and corporate management. In this article, we will take a closer look at the various platforms for investors to make their voices heard and how this can help influence the company that they invested in.

"Shareholder activism" is a broad term that encompasses the many ways in which investors have engaged corporate management on a broad array of issues. Concerned investors have been known to use a range of tactics to lobby for greater corporate responsibility, such as:

  • having dialogues with management;
  • letter-writing campaigns;
  • attending annual general meetings (AGMs); or
  • drafting resolutions and requisitioning extraordinary general meetings (EGMs).

In Malaysia, shareholder activism has become more common when compared to the past. For example, minority shareholders are now taking on a more active role in safeguarding their investments.

Avenues to express concern

So, how does an investor exercise his right to voice his opinion so that he is not taken for a ride? As an investor/shareholder you have several options to exercise your rights by making yourself heard. They are:


Attend shareholder meetings

Firstly, an investor should make the effort to attend shareholders’ meetings, i.e. the AGMs and EGMs. The AGM is the only shareholders’ meeting, and is required by law to be held by all companies. It provides shareholders with an opportunity to obtain information and question the directors and senior management regarding the company’s past performance and future plans, and to hold them accountable for their responses.

In addition to voicing their views and concerns on the company’s activities, shareholders should employ their right to vote at AGMs when resolutions are tabled in the agenda. This is one way for shareholders to exert some influence on the company. It has been acknowledged, however, that it is not easy for outnumbered minority shareholders to swing sufficient votes to oppose the will of the majority. Regardless of this, as an investor or shareholder, exercising your rights should always remain as one of your top priorities.

On matters of concern that are too urgent to wait until the next AGM, shareholders have the power to requisition an Extraordinary General Meeting. In this type of scenario, usually a minimum of two or more shareholders holding not less than 10 per cent of the issued share capital of the company have the right to  call for an EGM. This is where even the minority shareholders can play a role, by persuading or gathering other minority shareholders and demanding an EGM when necessary.

Write to or speak with the management of PLCs

Some public listed companies (PLCs) have dedicated investor relations units to give consistent and updated information on the company, as well as be a point of reference for investors. Investor relations units also serve to provide feedback for management to know and understand the perceptions, concerns and interest of shareholders and the investing community.

In certain companies, the corporate communication unit may also assume similar functions to investor relations. As for companies where there is no such formal structure, particularly the smaller PLCs, investors can speak to the company secretary or the chief financial officer.

Write to the print media, (Example: Letters to the editor)

Basically, writing to a newspaper will highlight your view or grouse to the public, attracting attention (whether wanted or unwanted) to the company and forcing them to take action. Since almost all newspapers have a section where readers can express their views on a particular issue, this is a highly effective (although not necessarily popular) method. Lobbying through the print media may also be able to garner support from other minority shareholders, as well as trigger action from the company or relevant authorities.

If you are a unit trust holder, you have the right to call for a unit holders’ meeting. You also have the power to vote for the removal of the trustee or the management company through an Extraordinary Resolution. At least 50 unit holders or one-tenth of all unit holders of a fund can apply for a unit holders’ meeting for the purpose of:

  • considering the most recent financial statements of the unit trust fund;
  • giving the trustee such directions as the meeting thinks proper; or
  • considering any other matter in relation to the trust deed[i] (refer to footnote A).

The trust deed which governs the powers and responsibilities of the management company, the trustee and unit holders, should stipulate specific provisions relating to the convening of the unit holders’ meetings.


When a corporation is formed, they are legally obliged to give certain rights to shareholders. These rights can help reduce losses, eliminate illegal or unethical practices, and give shareholders some control over who runs the corporation and the way it is run. As an investor, the power is literally in your hands! If you fully understand, appreciate and exercise your rights as an investor, you will be able to make better decisions when picking which stocks to buy. It will also help you determine whether certain corporate philosophies match your own principles about how a corporation should be run, and subsequently make the decision to buy or sell.


© Securities Commission Malaysia 2010

[i] According to Section 305 (1) of the Capital Market Services Act 2007:

305. (1) A management company shall call for a meeting of unit holders if—

(a) not less than fifty unit holders or one-tenth of all unit holders direct the management company to do so;

(b) the direction is given to the management company in writing at its registered office; and

(c) the purpose of the meeting is—

(i) to consider the most recent financial statements of the unit trust scheme or prescribed investment scheme;

(ii) to give to the trustee such directions as the meeting thinks proper; or

(iii) to consider any other matter in relation to the deed.


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