DPA30083 Company Law

TOPIC 4 Governance:
Company’s Director and Secretary

Ms. Amirah Zawani Binti Wakhi Anuar

Learning Outcome
At the end of this chapter, students should be able to;
● Define director
● Detail the discussion on the types of director
● Provide the explanation on the appointment of director
● Provide the explanation on the vacancy of office and removal of
directors
● Discuss duties of director
● Provide the discussion on the roles of Company Secretary

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Definition of Directors

Section 2(1) – includes any person

occupying the position of director of a
corporation by whatever name called &
Who are Directors? includes a person in accordance with
whose directions or instructions the
majority of directors of a corporation are
accustomed to act & an alternate or
substitute director

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 Shadow
director

Alternate/
Nominee
Substitute
Director
director

Types of
Directors
Chairman Executive
of directors Director

Non-
Managing
executive
director
directors
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1. Shadow Director
● Term “shadow director” has been used to describe “a person who is not
validly appointed as a director, but the directors of a corporation are
accustomed to act in accordance with those directions or instructions”

● Not officially a director, only provides advice and guidance to the board.

● Subjected to the usual fiduciary duties of directors.

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 1. Shadow Director (cont’d)
● Certain scenarios which can bring about a strong case of establishing a shadow director:
 A parent company, or even the controller of the parent company, giving instructions to
the directors of a subsidiary;

 A non-director who influences and takes control of the financial affairs of the company

 Negotiating with 3rd party on behalf of the rest of the BOD

 Controlling the appointment of senior management of the company

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2. Alternate Director
● An Alternate director is a person nominated by another director to
attend meetings or perform duties on his/her behalf.

● If a director of a company is unable for any time to act as a director,

due to illness or other commitments, he may appoint an alternate or
substitute director with the approval of other directors.

● A director of a public company however can only assign his or her

office if approved by a special resolution of the company.

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2. Alternate Director (cont’d)
● The Alternate Director is not required to hold qualification shares but is
entitled to notice of BOD meetings, to attend and vote and exercise all
powers of the substantive directors in his place.

● An alternate director may exercise all rights of the original director until it
is terminated by the original director or until the original director’s office is
vacated.

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3. Executive Director
● Full time director & they draw salaries from the company for performing
the managerial function.

● Has a specified decision-making role as a director of finance, marketing,

operations.

● Executive director generally:

○ Part of senior management of the company
○ Member of the board of directors
○ Attached with service agreement, stipulating terms and agreement
including salaries and duties. 9
4. Non-Executive Director
• Director who not hold any other salaried appointment with the company &
received fees determined by the member of general meeting.

• Sole function is to determine the overall policy of the company.

• Non-executive director generally:

• Not involved in full-time management of the company
• Not an employee of the company
• Represents the interest of shareholder

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 5. Managing Director
● Is the most senior full-time executive of the company.

● Managing director @ Chief Executive [CEO] is responsible for the performance of the
company, as dictated by the Board’s overall strategy.

● He or she has responsibility for the day to day management of the company and putting
into effect the decisions and policies of the Board

● He or she reports to the Chair @ BOD.

● Responsibilities : formulating and successfully implementing company policy, directing

strategy towards the profitable growth and operation of the company, closely monitoring
the operating and financial results against plans and budgets and etc.

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 6. Chairman of Director
● Leads the Board, sets its agenda & ensures it is effective working group at the
head of the company.

● Roles of Chairman and CEO should not be held by the same person.

● The chairman ensures there is a good working relationship between the executive
and non-executive directors and sufficient time to discuss strategic issues.

● Responsibilities : setting strategy, ensuring the human & financial resources are
available to achieve objectives, reviewing management performance, ensuring
that obligations to shareholders and other stakeholders are understood and met. 12
 7. Nominee director
● Nominee directors are persons who are appointed as directors by virtue of their
positions as employees of the majority members or debenture holders.

● A person is appointed as a nominee director to represent a member of the

company, his employer or a debenture holder.

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Appointment of Director

Minimum
number of Qualification to
director become a
Director

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Minimum number of directors
● Section 196(1) – prescribes the minimum number of directors in a
company. The company’s constitution may set a higher limit.
○ Private company – 1 director
○ Public company – 2 directors

● Section 196(4)(a) – Minimum directors must “ordinarily reside in

Malaysia by having a principal place of residence in Malaysia”.

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 Minimum number of directors
● CA 2016 does not prescribed the methods the directors are to be appointed – up to the
company’s constitution

● The constitution of a company may provide for certain person or body to have power to
appoint directors and such power may be enforced by order of specific performance.

● S196(1) – Every private company, including a newly incorporated company, must have at
least 1 director and for public company, the minimum number of directors is 2.

● Usually directors are elected by member at AGM

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 First Directors
● First Directors:
○ S202(1) – the 1st director(s) of the company shall be the person(s) named in the application for the
incorporation of the company.

○ S201 – He must have consented to be a director of the company as well as confirmed that he is not
disqualified under the Act to act as a director

○ It is clear that the appointment of the 1 st director(s) of the company is made by the promoters of the
company. The promoters may appoint 1 @ 2 of themselves to be the 1 st director(s).

○ The 1st director(s) are deemed to have been appointed when the company is incorporated.

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 Subsequent Directors
● Subsequent Directors:
○ All subsequent directors may be appointed as follows:
■ S202(2) – By ordinary resolution
■ S202(3) – By the BOD

○ Where the company is a public company, S203 requires the appointment of

directors to be voted individually. 2 or more directors cannot be appointed in the
same resolution.

○ A retiring director is eligible to be re-elected if he is not disqualified.

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 Qualification to become directors
1. S196(2) - Natural person of 18 2. S208(1) – Not Unsound mind 3. S198, S199, & S201- Not
years & above disqualified by the constitution

• S196 (2) provides a director shall • S208(1) provides that a director • S201, a person can only be
be a natural person who is at least must vacate position if becomes appointed as a director if has
18 years of age. unsound of mind. consented in writing

• Only human being can be • Person suffer from ‘mental • S198 and S199 – to make
appointed as a director. disorder’ is disqualified from being ‘declaration’ that he/she is not
a director. disqualified from being appointed
or holding office as a director.

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 Qualification to become directors
4. Share qualification 5. S199(1) – Not restrained by the 6. S264(1)(c) – Not an auditor of the
court company

• A company in its constitution may • ROC may applied to the court to • May have personal interest or
require its directors to hold a restrain a person from acting as a financial interest on the company.
minimum number of shares in the director or taking part in
company. management of the company.

• he would be disqualified from

being a director of the company

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 Vacancy of Office
● The office of director may become vacant in one of the
following situations:
1. S208 (2) – Resigns with a 3. S206 & S207 – Removal
written notice to the 2. S205 – Retirement from office
company

4. Disqualified to act as a 5. Disqualified as failure 6. Director becomes unsound

director obtain share qualification of mind

7. Deceased

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1. Resignation of Directors
● S208(2) – A director may tender his resignation by giving a written
notice to the company at its registered office.

● The resignation will take effect on the date the BOD received the
letter of resignation or the date stated in the letter.

● S209(1) – the resignation is not effective and valid if it results in the

company having no director.

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1. Resignation of Directors (cont’d)
What happens if there is only 1 director in the company, he wish to
resign?

S196(3) – where a company has only 1 director, that director shall not resign
until that director has called a meeting of member to received the notice of
resignation and to appoint new directors

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1. Resignation of Directors (cont’d)
● If a vacancy is created due to resignation, the BOD may appoint another
person to be a director to fill the vacancy.

● For public company, the new director shall hold office until the next AGM,
and if this company is a private company, he will hold office in accordance
with the terms of his appointment.

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2. Retirement of Directors
● Retirement:
 S205(1) – “the provision under this section shall apply with regards to
the retirement of directors unless there is specific provision in the
company’s constitution or the term of appointment regarding
retirement of directors’’

 The provision in S205 applies only if there is no provision on

retirement of directors in company’s constitution and in the terms
appointment of director.

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 2. Retirement of Directors (cont’d)
● 1st Directors:
○ S202 – the 1st director(s) will hold office ‘until that person ceases to hold office as a
director in accordance with this Act”

○ S205(3) – the 1st director(s) of a public company will hold office until he company’s
1st AGM. But it is not mandatory that 1st director(s) of a public company retire at the
company’s 1st AGM. The company’s constitution may provide otherwise.
○ There is no provision pertaining to the retirement of the 1 st director(s) of a private
company. Reference has to be made to the company’s constitution.

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2. Retirement of Directors (cont’d)
● Subsequent Directors:
○ The rules on the retirement of subsequent directors can also be gleaned
from S205. The rules for public company and private company are
different

○ In addition, the retirement of a director cannot cause the company to

contravene S196 on the minimum number of 2 directors ordinarily residing
in Malaysia.

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 2. Retirement of Directors (cont’d)c
● Subsequent Directors for Public Company:
○ S205(1) – this provision shall apply with regards to the retirement of directors unless there
is specific provision in the company’s constitution or the term of appointment regarding
retirement of directors.

○ If the constitution are silent, rules in S205 applies.

○ S205(3)(a) – at the 1st AGM all directors shall retire from office at the conclusion of the
meeting. It appears that if a person is appointed a director before the 1 st AGM, he shall
retire at the conclusion of the AGM.

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2. Retirement of Directors (cont’d)
● Subsequent Directors for Public Company:
○ S205(3) – prescribes for retirement by rotation, but the company’s
constitution or terms of appointment of director may exclude or
modify the requirement.

○ S205(3)(b) – 1/3 of the directors must retire every year

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 3. Removal of Directors from Office
● Reasons for company to remove a director from office, due to fails to perform
duties or breaches duty.

● For private company - CA 2016 does not prescribe the procedure for removal of a
director, other than it cannot be done through written resolution.

● Thus, reference is to be made to the company’s constitution.

● If the company does not have constitution, S206(1) provides that the director may
be removed by an ordinary resolution

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 3. Removal of Directors from Office (cont’d)
● S206 provides provision regarding the removal of director for a public company.

● S206(2) – the company may by ordinary resolution removes a director:

○ Give a special notice – at least 28 days before meeting
○ At the meeting, the director shall be entitled to speak to the members
○ If the director was originally appointed to represent the interests of any particular
class of shareholders – a successor must be appointed before the resolution to remove
takes effect.
○ The resolution to remove the director will be put to vote. It is passed if it obtains
more than half of the votes.
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 4. Disqualification of Directors
● S198 provides that a person shall not hold office (whether directly or
indirectly) or takes part in the management of a company, if the person:

○ Is undischarged bankrupt
○ Convicted of offence relating to the promotion, formation or
management of a corporation
○ Convicted of offence involving bribery, fraud or dishonesty

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4. Disqualification of Directors (cont’d)
● Convicted of offence under this provision:
○ S213 – failure to act proper propose & in good faith in the best interest
of the company
○ S217 – duty by nominee director
○ S218 – improper use of property, position etc
○ S228 – unfair deal transaction with company
○ S539 – failure to keep proper account

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 4. Disqualification of Directors (cont’d)
● Where a company director is disqualified pursuant to either the CA 2016 or the company’s
constitution, a casual vacancy is created.

● S208(4) – the BOD shall have power to appoint any person to fill the casual vacancy.

● For public company, this newly appointed director shall hold office until the company’s next
AGM

● For private company, the newly appointed director shall hold office in accordance with the
terms of his appointment. The terms of appointment cannot be inconsistent with the CA 2016.

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 5. Disqualified as failure obtain share
qualification
● A company in its constitution may require its directors to hold a
minimum number of shares in the company. [share qualification]

● If the director did not hold the minimum number of shares required,
he would be disqualified from being a director of the company.

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 6. Directors become unsound of mind
What happens if there is only 1 director in the company, and he is
disqualified, becomes unsound mind or dies?

S209(3) – the secretary shall as soon as possible call a meeting of the next of
kin, other personal representatives or a meeting of the members, to appoint a
director

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7. Deceased
● Where the sole director dies, the next of kin, personal representatives or the
member shall within 6 months after the death, appoint a new director.

Failure to do so may cause the company to be

struck off the register by the ROC

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 Powers of a Director
● A company consists of 2 organs, namely the BOD and the members. Their respective powers and
duties are prescribed in the CA 2016.

● A director is an agent of the company and thus owes a fiduciary duty towards the company.

● The director is to act honestly, in good faith for the benefit of the company. He is not to abuse his
power or position. He should avoid any conflict of interest.

● For the purpose of subdivision – definition of directors includes CEO, CFO, COO or other person
primarily responsible for the management of the company

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Powers of a Director (Section 211)

1. The business and affairs of the ‘Board of Directors’

company shall be managed by, or according to
under the direction of the board. Section 2(1)

1) Total directors of the company

2. BOD has all the powers for 2) If the company has only one
managing and directing as well as director, BOD refer to that
supervise the management of the director.
business and affairs of the company

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Duties of a Director
Duties of Director

1. Fiduciary Duty – Duty to Act in 3. Duty of Disclosure of

2. Duty of Reasonable Care, Skills,
Proper Purpose and in Good Faith Director’s Interest and Conflict
and Diligence
in the best Interest of the Company of Interest

- Business Judgement Rules

- Reliance on Information
- Delegation of Power
- System of Internal Control

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 • Duty to act in good faith - S213 (1)
Fiduciary Duty
• Duty to act for proper purpose – S218
(1)
• Duty to retain discretion

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 1. Duty to act in good faith for the interest of company
 A director must act bona fide in the company’s interest. He must not act for
his own interest of any other person.
 The duty is owed to the company and not to individual members. The interest
of the company must be made paramount, not the interest of other parties

Re W & M Roith Ltd

The director owned a substantial portion of shares in the company. He was terminally ill and
wanted to provide for his wife, thus he entered into a contract with the company to pay a pension to
his widow.

The court held that the contract was void as the BOD did not act in the best interest of the company
but for the widow of the director. It was not make in good faith.
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1. Duty to act in good faith for the interest of company

Prohibition of loan to director or persons connected with directors

 S224 – company shall not make loan to director of the company or related
company
 Also cannot enter into any guarantee or provide any security in
connection with a loan made to director

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1. Duty to act in good faith for the interest of company
Prohibition of loan to director or persons connected with directors
 S225 – prohibits a company from giving a loan or providing a security for a
loan granted to a person connected with its director
 Family members: spouse, parent, child, siblings, the spouse of his child,
brother or sister
 Body corporate (holds more than 20% of its voting power)

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2. Duty to act in for proper purpose
 A director has been given power which must be exercised for a proper
purpose and not for a collateral purpose
 The director should not use his powers in the interest of some other person
or body
 Prohibition against the improper use of company’s property, position,
corporate opportunity or competing with the company

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Prohibition against the improper use of company’s property, position, corporate opportunity or
competing with the company
 S218 – if a person becomes director of 2 or more company, he cannot subordinate
the interest of one over the other
 A director cannot:
 Use company property
 Use any information acquired by virtue of his position
 Use his position
 Use any opportunity of the company
 Compete with the company

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2. Duty to act in for proper purpose
 The general rule is that a director must not place himself in a position where his duty and
interest conflicts
 Instances where there are conflict of interest:
 A director shall not use the property or money of the company to make profit for
himself
 A director shall not use information acquired by virtue of his position to make a profit
for himself
 A director shall not use his position to obtain a profit for himself
 A director shall not retain profit made by reason and in the course of his fiduciary
relationship with the company

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2. Duty to act in for proper purpose

● Requirement to disclose certain interest

 S219 – general duty to make disclosure
 Shall give notice in writing with regard to interest in shares, debentures,
contract etc.
 Notice within 14 days – from the date of becoming director or date of
acquiring the interest
 If contravene, will commit an offence and liable to fine and imprisonment

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 Cook v Deeks

The Toronto Construction had 4 director, Mr GM Deeks, Mr GS Deeks, Mr Hinds and Mr Cook. The first
3 directors wanted to exclude Mr Cook from the business. Each held a quarter of the company’s shares.
The 3 directors later took a contract in their own names. They then passed a shareholder resolution
declaring that the company had no interest in the contract. Mr Cook claimed that the contract did belong to
the Toronto Construction and the resolution should not be valid.

The court held that the 3 directors had breached their duty and the resolution was a fraud on Mr Cook as a
minority shareholders. The result was that the profits made on the contractual opportunity were to be held
on trust for the Toronto Construction.

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 IDC v Cooley [1972]

Cooley was the director of IDC. IDC tendered but did not get the project from Gas Board. The Gas
Board subsequently offered the contract to Cooley. Cooley resigned from IDC and accepted the
offer.

The court held that Cooley had put himself in a position where his duty to the company conflicted
with his own interest. As he had breached his duty, he was accountable to IDC for the profit.

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3. Duty to retain discretion
 In a company, the directors must be independent in making their decisions

 There should not be any limitation, restriction or prohibition by the previous

director in the present. In the event the previous directors have imposed limitation,
restriction or prohibition, they are in breach of their duties.

 Directors must ensure that their decisions are informed, independent and involved
the active exercise of their discretion.

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3. Duty to retain discretion

 However, they are justified in trusting officers of the company to perform all
duties, that having regard to the exigencies if the business, may be properly left
to such officers.

 Directors can also delegate their powers but this must with proper authority.

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Duty of Care, Skill and S213(2)
Diligence • With knowledge, skill and experience
reasonably expected of a director having
the same responsibility
• Any additional knowledge, skill and
experience the director in fact has

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Reasonable care, skills and diligence
 A director will be judged by the standard of care that can be reasonably be
expected from a person of his knowledge and experience

 In Lim Weng Kee v PP – stated that the test of whether a director had been
acted with due skill would not be lowered to accommodate inadequacies in an
individual’s knowledge but the standard would raised if the individual held out
as having the knowledge or experience.

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Reasonable care, skills and diligence
 Standard of skill will depend on several factors:
1. Executive or non executive directors
2. Professional qualifications
3. Type of positon and responsibilities

 However, under S213(2)(a) – necessary for directors to possess some basic

skills

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 Example directors breached duty in practice:

• Approving of financial statements without being properly informed;

• Failing to monitor business financials
• Approving the statements issued by the company without checking if they
are accurate
• Causing a company to enter into a risky transaction that does not show any
prospect of success
• Failing to inform the BOD of relevant matters
• Not paying enough attention to the company
• Not keeping himself informed about the company
• Acting dishonestly

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 Duty of Disclosure • Requirement for Director to
Director’s Interest and disclose certain interest
Conflict of Interest

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 Duty of Disclosure Director’s Interest and Conflict of Interest

Requirement to disclose certain interest

 S221– disclosure of material interest in contract, proposed contract property offices
etc:
 To be declared at a meeting of the BOD
 S221(9) – interest in shares, debentures of a company includes that of a spouse or
child (adopted and step child)
 Contract entered into in contravention of S221 is voidable at the option of the company
 S222 – during the BOD meeting, interested director may attend but CAN NOT to
participate or VOTE (only applicable to public company)

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Business Judgement Rule

● S214(2) – The business judgment means any decision on whether or not to take action in
respect of a matter relevant to the company’s business.

● A director is deemed to have made a business judgement if he:

a) Makes the decision for a proper purpose and in good faith
b) Does not have a material personal interest in the subject
c) Makes the decision based on information given which the director reasonably believe to be
appropriate under the circumstances
d) Reasonably believes the decision is in the best interest of the company

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Business Judgement Rule

● Directors may turn out to the wrong or unprofitable decisions. This could be due to
unforeseen circumstances such as economic downturn, volatile market etc.

● Having recognized that not all decisions made by the directors will turn out to be good
decision, the courts have stated that they will not review the merits of business decisions
made by directors.

● This is known as the business judgement rule.

● To safeguard the directors, S214 provides that a director who makes a business judgment is
deemed to have met the requirements of duty under S213(2) and the equivalent duties under
the common law and equity.

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Rely on the information

• In exercising director’s duties, a director may rely on information, professional or expert

advice, reports or statements including FS as well as data made by third party.

• S215 – director may rely on information, professional or expert advice, opinion, reports or
other statements made by:
• Any officer who are believe to be reliable and competent
• Any other person possessing certain skill and expertise
• Another director
• Any committee appointed

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Delegation of Power
 Reliance must be made in good faith and after making independent assessment based on the
directors knowledge

 S216 – directors may delegate any power of the BOD to any committee, director, employee,
expert or other person. However director are still responsible for the exercise of the power by
the delegate

 S216(3) – directors will escape responsibility if:

1. Believed on reasonable grounds at all times that the delegate would exercise the power in
conformity with directors own duties
2. Believed that the delegate was reliable and competent

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Remedies for Breach of Duties
● A company’s remedies for breach of duty by its directors may take 3 ways:
○ The company may sue for damages (in case of negligence or breach of fiduciary
duties) or for the return of specific property
○ In case of breach of fiduciary duties, may also claim the secret profit made by the
director
○ Seek declaration that the exercise of power in breach of the director’s duty to be
declared invalid.

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 Company Secretary

1. Registration of Company 2. Qualifications of 3. Disqualification to Act as

Secretary Company Secretary Company Secretary

5. Duties of Company
4. Main Duties of Company
Secretary Before, During
Secretary
and After a Meeting

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 Who is Company Secretary is a professional
company profession who is in charge of playing the
secretary? role as an adviser for legal matters in a
corporate setting.

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1. Registration of A Company Secretary
● 1st secretary
a. S18(5) – the proposed of 1st secretary may be given in the application for
incorporation of the company
b. S236(2) – requires the BOD to appoint the 1st secretary within 30 days from the
incorporation of the company
● Subsequent secretary
a. S236(1) – The appointment of a subsequent company secretary is made by the
BOD

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1. Registration of A Company Secretary
○ Information required for registration of Company Secretary:
■ Name of the Company Secretary
■ Residence address and business address of the Company Secretary
■ Any information as required.
○ Registrar will issue a practicing certificate to act as a Company Secretary after all the
requirement is fulfilled.

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2. Qualification of A Company Secretary
● A company is required to comply with the provisions in the CA 2016 and other
legislations. Directors who are appointed to manage the company’s business may not
have the technical knowledge or the time to attend to them.

● Thus, S236 requires every company to appoint at least 1 company secretary who
ordinarily resides in Malaysia by having a principal place of residence in Malaysia.

● The office of secretary shall not be left vacant for more than 30 days

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2. Qualification of A Company Secretary
● The qualifications of a company secretary are listed in S235 and 241, whereas those
who are not qualified to be a company secretary are listed in S238

Must not convicted whether within or outside Malaysia of any

S235(1) – Natural person of 18 years and
offence involving fraud or dishonesty punishment on
above
conviction with imprisonment for three months or more

S235(1) – A citizen or PR of Malaysia who Must not have any pending legal action against him/her under
shall ordinarily reside in Malaysia by having a any provision of the Companies Act 2016 .
principal place of residence in Malaysia.

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2. Qualification of A Company Secretary
Can a director becomes the company secretary?

● A company may appoint its director to act as its company secretary

● However, a person who is holding the dual positions as director and
company secretary cannot act in both capacities at the same time.
[S242]

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 3. Disqualification of A Company Secretary
● S238 provides that a person who has the following characteristics is disqualified to act as a
company secretary, but may continue to do so with the court’s approval.
1. A bankrupt
2. Ceased to be the holder of a certificate of practice issued by ROC
3. Convicted of an offence;
■ Offence in connection with the promotion, formation or management of a company
■ Bribery, fraud or dishonesty
■ Improper use of company’s property
■ Company’s failure to keep proper accounts, or wrongful trading

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 Removal and Resignation of A Company Secretary
● Removal
i. S239 – BOD may remove a secretary from his office in accordance with the terms of his
appointment
● Resignation
i. A company secretary may resign at any time by submitting to the BOD a letter of resignation
ii. S237(3)(a) – a secretary ceases to be the secretary on the expiry of 30 days from the date of the
letter or period specified in the company’s constitution
iii. S237(2) – allows the company secretary to resign if cannot communicate with all directors
iv. S237(2) – the secretary is to give notice to ROC & he shall ceases to be the secretary on the
expiry of 30 days form the lodgment of the notice

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 4. Main Duties of a Company Secretary
● In Re Maidstone Buildings Provisions Ltd – the court held that the company secretary
handles the administrative, not the management, matters of the company

Update in the compliance of

Familiarize with the provisions Ensure correct procedures are
numerous statutory and
of company’s constitution followed
regulatory bodies

Maintenance of the Registered Maintenance of Register of

Lodgement of Documents
Office Members

Preparing Board and Member’s

Resolution and attending
meetings 73
 Maintenance of the Registered Office
● The secretary of a company may be full time employee of the company. In such instance, the
company’s registered office usually at the company’s place of business.

● Alternatively, a company may use the secretarial services provided by a secretarial firm or company.
Then, the company may use the secretarial firm’s place of business as its registered office.

● S46(2) – the registered office must be opened and accessible to the public during ordinary business
hours.

● S48 – provides that the company shall provide proper facilities to enable the documents and records
to be inspected.

● E.g.: minutes of BOD meetings, resolution, notice of registration, constitution directors’ service
contract etc.
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 Maintenance of Register of Members
● S50 requires every company to keep a register of members.
● The particulars of each member and the number of shares held and amount paid must be entered into the
register.

● S54(1) – the register of member and its index shall be kept at:
1. The company’s registered office
2. Another office of the company in Malaysia; or
3. The office of the person who maintains the register in Malaysia

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 Maintenance of Register of Members

● S102(1) expressly imputes the duty on the secretary to ensure the register
of member is properly kept and maintained regularly.

● If the register is not properly kept or maintained, the company secretary

commits an offence and is liable to a fine.

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 Lodgement of Documents
● Generally, the company secretary is the person who lodges the company’s documents with the
ROC. Among the documents which are required to be lodged are:
a) S58 - The particulars of directors, managers and secretaries and changes thereto;
b) S68 – the company’s annual returns. Co Secretary is responsible for the completion and
timely submission of the company’s annual return.

● If the company fails to comply, the company and every officer of the company, including the
company secretary, shall be guilty of an offence under the Act.

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 Preparing Board and Member’s Resolution and
attending meetings
● At the instruction of the BOD, the company secretary issues the notice of
company’s meetings.

● Provide general advice relating to company secretarial matters during board

meetings.

● Co secretary will send out notice and liaise with shareholders for any
meetings to be attended.

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 Preparing Board and Member’s Resolution and
attending meetings
Examples matters to be called for board meetings:

● S221 provides that a director who is in any way interested in a contract or proposed contract
with the company shall declare the nature of his interest at a BOD meeting.

● The secretary is required to record such declaration in the minutes of the meeting.

● In the event of the sole director has died or became of unsound mind or been disqualified,
S209(3) gives power to the secretary to call a meeting of the members, next of kin or personal
representatives.

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5. Duties of
Company
Secretary
Before,
During and
After a
Meeting

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END OF CHAPTER
● Thank You!

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