The Wakeel Group

The Wakeel Group of companies was listed on the Bursa Malaysia (Wakeel) in 2002 fits the definition of companies with controlling shareholders. The Wakeel grew throughout the years into one of the biggest diversified conglomerates in the world, spanning many businesses including retail, logistics, real estate, financial services, hospitality and automotive. Wakeel has left a legacy in its principal operating area of Malaysia, with several landmarks such as Wakeels Auto and Wakeel House. Wakeels controlling shareholder is the Nik family, and members of the Nik family also play main board and management roles in the different companies within the group. The ownership structure of Wakeel includes:

Wakeel family members and trust 77.46%

Other (non-family) director 0.61%

Balance with other shareholders 21.93%

However, after the 2008 global economic crisis, the group was left drained and was eager to seek safer pastures in which to manage Wakeel. The Boards of the Wakeel companies often lacked an independent element. In particular, the directors are concern about the governance of Wakeel and would like the Boards to undergo re-structuring before it could maintain to comply with the Bursa Malaysia Corporate Governance listing requirements, which had a strong emphasis on board balance and independence, or Wakeel is to face the risk of being delisted.

Questions:

1. Discuss what is meant by separation of ownership and control in firms.
2. In your own words, explain the rights and powers of shareholders conferred by the Companies Act 2016 and how these are exercised.
3. What is your opinion of Wakeels ownership structure? - Differentiate between governance of family-controlled companies and the nature of government-linked companies (GLC) in Malaysia.
4. Describe activities that might involve shareholder activism.