FOUR months into Malaysia’s corporate governance push under the MY Value Up initiative by Bursa Malaysia and the Securities Commission (SC), the question is becoming harder to avoid: How will investors know whether the programme is actually working?
While the framework has put greater emphasis on long-term value creation, market observers say the absence of publicly disclosed targets and measurable outcomes has made it difficult to distinguish genuine progress from good corporate storytelling.
With key disclosures only expected to become visible from 2027, investors are effectively being asked to wait for the scoreboard.
This has sparked a broader debate over whether principles alone will be enough to drive meaningful change, or whether companies need clearer key performance indicators (KPIs), benchmarks and eventually a public scorecard to demonstrate their progress.
The early verdict from parts of the market has been polite but impatient. Without a public scoreboard of targets, milestones or comparable metrics, it is difficult to judge whether boards are truly shifting behaviour or simply refining their narratives.
As the SC and Bursa Malaysia work to embed the framework into the market, analysts and investment strategists are weighing whether stronger incentives – and potentially mandatory elements from 2028 – will be necessary to turn MY Value Up from a statement of intent into something investors can measure, compare and ultimately hold companies accountable for.
Numbers more essential than just a story
According to Indy Lau, voluntary programmes only outlast a compliance mindset when the numbers underneath are real – and the longer specific benchmarks stay undefined, the greater the risk of narrative outrunning substance.
“So the metrics question matters. The signals that travel furthest with investors are the ones already comparable across companies: return on equity (ROE), capital-return ratios such as dividend and buyback payout, and the share of listed companies still trading below book value,” she tells StarBiz 7. Lau is chief operating officer for Moomoo Malaysia.
In addition, she points out that progress against a company’s own stated plan matters just as much, but it only becomes credible once those plans carry dated, quantified targets rather than aspirations, and that is the crucial line between a scoreboard and a story.
“Besides, there is a further point that often gets lost in this debate, and that is improvements only register with the broader investor base once they appear as tangible, comparable numbers.
“Hence, the design question isn’t purely about institutional capital, but rather it’s about whether the market as a whole can see the difference,” she adds.
Lau explains that as MY Value Up encourages companies to articulate their value-creation story more clearly, the complement is equipping investors to evaluate it, and that is where she says Moomoo plays a role.
“With more than two million downloads, we sit close to how everyday investors use our platform to research and assess before investing in a company.
“A market only works when companies communicate with discipline and investors genuinely understand what they own before they act, and that combination is exactly the healthier, more credible market this programme is aiming for,” she says.
Increasingly, this means putting artificial intelligence (AI)-powered tools like Moomoo AI in ordinary investors’ hands, helping them make sense of company fundamentals and surface risks they might otherwise overlook, and cutting through the complexity that too often keeps retail investors on the sidelines.
Resonating with that view, IPP Global Wealth investment strategist Mohd Sedek Jantan acknowledges the risk that MY Value Up could remain largely a storytelling exercise if there is no clear scoreboard or quantifiable KPIs, saying that this is a “key test” for the programme.
The initiative should not be judged by how many companies publish a Value Up Plan, but by whether those companies actually improve capital efficiency, capital allocation and long-term shareholder returns.
Mohd Sedek says what investors need is standardised measurements, but company-specific targets, adding that there are three critical areas.
“First, economic value creation. Companies should disclose whether ROE exceeds their cost of equity, or return on invested capital (ROIC) exceeds weighted average cost of capital (WACC) where appropriate.
“The important question is not whether ROE is 8% or 15%, but whether the company is generating returns above its cost of capital and whether that spread is improving,” he explains.
Capital allocation discipline is the second important metric. Mohd Sedek says investors should be able to track free cash-flow conversion, dividends, buybacks, leverage, acquisitions and the returns generated from reinvested capital.
“Management should explain where incremental capital is going and what return shareholders should expect from it,” he tells StarBiz 7.
“Third, delivery against commitments. A credible Value Up Plan should have a clear baseline, measurable targets and a three to five-year timeline. Investors can then compare what management promised with what management actually delivers,” he opines.
As such, he would support a public dashboard eventually, but it should measure progress against commitments, rather than simply rank companies by share-price performance.
“Ultimately, the programme will be credible if, three years from now, we can demonstrate that companies with credible Value Up Plans have actually improved their returns on capital and shareholder outcomes. Better storytelling is not the objective; better corporate economics is,” says Mohd Sedek.
Early indicators of genuine progress
Calling for market patience is reasonable, and sequencing disclosure ahead of anything mandatory is sound, says Moomoo’s Lau, since reforms imposed faster than boards can absorb tend to produce compliance theatre rather than change.
“That said, patience shouldn’t be mistaken for passivity, and there’s plenty worth watching well before 2027.
“The clearest is voluntary adoption momentum. In South Korea, within about two years, roughly 45% of market capitalisation had disclosed value-up plans, and in Japan over 90% of the Prime Market did – that gives a sense of what real momentum looks like compared to a slow start.”
For context, the Prime Market is the top-tier segment of the Tokyo Stock Exchange, launched on April 4, 2022, designed for large-scale companies committed to sustainable corporate governance, high liquidity and maximising mid to long-term shareholder value.
Closer to home, Lau says investors should also watch engagement among the targeted large-cap cohort, specifically on whether a meaningful share of those companies is already drafting quantified plans with boards, and not just polishing language in annual reports.
She says the first indicator is whether companies improve the specificity of their existing disclosures voluntarily, ahead of any obligation to do so – and in particular, whether that engagement is happening at board and management level rather than being parked at the investor-relations desk, which is usually the clearest tell of genuine intent versus box-ticking.
“Secondly, we can observe capital allocation behaviour, in whether boards begin adjusting buyback activity, dividend policy or the treatment of underperforming assets in ways that suggest the programme is already shaping decisions rather than just being reported on, and structurally, whether the share of companies trading below book value begins to narrow,” she notes.
The third is whether any of this reaches the retail investor, a signal she says Moomoo is reasonably well-placed to observe, given how closely the trading platform sits to the way everyday Malaysians research and allocate.
Lau views deeper market participation sits behind the rationale for a programme like MY Value Up, so if governance improvements are not translating into greater confidence at that level, it would mean policy is yet to achieve the work it sets out to do.
“If none of these move by the time we reach 2027, that’s a reasonable basis to conclude the voluntary phase underdelivered, and the argument for accelerating the mandatory elements becomes considerably stronger,” she says.
Meanwhile, Mohd Sedek says the market does not necessarily need to wait, observing that equity markets are forward-looking, so a credible MY Value Up plan can influence valuation as soon as investors believe management is serious about changing capital allocation.
“But sustainable re-rating requires evidence. So we would give companies time to execute, but not unlimited patience.
“In 2026 and 2027, we should focus on the quality of the commitments rather than the number of companies participating,” he says.
Mohd Sedek says identifying actual value-creation hindrances, capital allocation, management incentives and what management teams do with capital are all crucial factors to look out for.
“If a company talks about value creation but continues to make low-return acquisitions, accumulate excess cash or dilute shareholders, investors should question the credibility of the plan.
“So, the framework is simple: 2026 is preparation, 2027 is disclosure and price discovery, while 2028 onwards should increasingly be the evidence phase. The market should be patient with execution, but not with repeated failure to deliver,” he says.
Potential carrot and stick: GLIC investments and mandatory disclosure
Mohd Sedek is convinced that the real test of MY Value Up is not whether companies talk more about value creation, but whether investors can see the value in the numbers.
Investors ultimately do not invest because a company has produced a good Value Up Plan; they invest because they believe the company can generate better earnings, stronger cash flow and higher returns on capital, he says.
“If a listed company improves ROIC, strengthens free cash flow and allocates capital more efficiently, the market should reward that through a lower cost of capital and potentially a higher valuation.
“This is where government-linked investment companies (GLICs) and institutional investors can play an important role. Capital should increasingly differentiate between companies that only disclose a plan and companies that actually deliver.
“We would, therefore, favour incentives or recognition being linked to measurable outcomes rather than simply participating,” he says.
Mandatory disclosure provides a minimum level of transparency and prevents persistent laggards from avoiding scrutiny, but Mohd Sedek says enforced disclosure should be the floor, not the destination.
“We should not create a system where companies comply with the disclosure requirement but do nothing to improve their underlying economics,” says Mohd Sedek.
Moomoo’s Lau says getting an allocation of a GLIC’s investment, or being mandated to disclose Value Up initiatives should not be seen as competing levers so much as sequential ones.
She reckons that incentives will move behaviour faster in the near term because they carry commercial consequences, rather than reputational pressure alone.
In the Malaysian context, Lau says aligning GLIC capital allocation with genuine Value Up performance would be a similarly powerful lever, because the GLICs are among the market’s largest domestic shareholders.
“The strongest outcome comes from running both together, with incentives pulling early movers forward visibly and the mandatory floor ensuring the rest don’t simply wait it out.
“Relying on either alone risks rewarding a narrow group of performers without lifting the market broadly, or arriving too late to shape the allocation decisions being made today,” she adds.