MACC flags governance weaknesses as root cause of leakages

KUALA LUMPUR: Governance weaknesses are among the most common aspects identified by the Malaysian Anti-Corruption Commission (MACC) during preliminary investigations into leakage and misappropriation within organisations in the country.

MACC chief commissioner Datuk Seri Abdul Halim Aman said the commission's investigations focus on three main categories under the MACC Act 2009, covering corruption under Sections 16 and 17, misappropriation under Section 18, and abuse of power under Section 23.

"Apart from that, we also need to investigate governance weaknesses where they exist. This issue of governance is interconnected.

"In most cases, when investigations are carried out, we find that the root cause ultimately traces back to governance weaknesses," he said.

He emphasised that governance weaknesses should be viewed through the lens of improvement and rectification, rather than immediately being treated as evidence of a criminal offence.

He said MACC cannot pass judgment purely on governance issues, but can instead offer advice to rectify and improve identified weaknesses within an organisation.

"For governance, we cannot frame any judgment. We can only provide advice in terms of improvement, rectification, or establishing governance procedures where none exist," he said.

He said failure to comply with or establish proper governance can impact fund management, leading to leakages in the original budgets allocated by the government.

He added that this highlights the importance of good governance, not only for procedural compliance, but also to ensure public allocations are spent as intended.

"This represents a leakage from the original budget presented or provided by the government, which must be rectified and resolved," he said.

He further explained that when governance issues are identified at the end of an investigation, MACC takes follow-up action by dispatching teams to the affected agencies, companies, or organisations to assist in addressing those weaknesses.

At the same time, he said public awareness must be raised across society, government agencies, companies, and organisations regarding the importance of governance as a fortress against leakages.

He added that the media plays a vital role in educating the public on the significance of governance and its impact on fund management and public confidence.

"It is hoped that explanations and awareness can be provided to the public, agencies, and companies regarding the importance of governance, as weaknesses lead to massive leakages that erode allocations and public trust," he said.