Malaysia’s executive and non-executive directors are expected to receive salary increases of 5.44% and 5.43% respectively in 2023, according to a survey by the Malaysian Employers Federation (MEF).
Almost 90% of firms surveyed said employees’ performance was the main criteria for determining executive and non-executive salary increases, according to President Syed Hussain Husman.
He said: “The business respondents seemed to be positive that Malaysia’s economy is generally going to be stable next year despite the expectation of a global recession.
“This was on the back of positive recovery of most businesses since the reopening of the economy after the (Covid-19) pandemic,” he said at the launch of the MEF Salary Surveys for Executives and Non-Executives.
The survey also found that 93% of firms granted salary increases to executive and non-executive employees in 2022, a big rise on the 65.2% and 66.4% respectively recorded in 2021.
Syed Hussain said the survey showed that the average salary increase for executives and non-executives in 2022 was 5.26% and 5.35 respectively, with more than 80% of respondents also awarding bonuses.
“The forecast for bonuses in 2023 is 2.18 and 2.06 monthly salary for executives and non-executives, which was higher than the actual bonus in 2022 of 2.06 months and 1.77 months,” he said.
The survey also covered the new minimum wage, which increased to RM1,500 a month and impacted 70.35 of the businesses surveyed.
Companies not affected by the new minimum wage said the main reason was that their employees’ salaries were already higher than the minimum level.
Syed Hussain said 53.4% of the respondents also anticipated an increase in their overall salary or wage costs because of the new minimum wage.
He said 59.7% of them planned to reduce their operating costs to mitigate the impact of the new minimum wage, while 48.8% said they would increase the price of their products or services.
“Another 43.8% of respondent companies intend to implement cost-cutting measures in other areas of production while 36.8% intend to shift from labour-intensive to technology-intensive production,” he added.
Some 252 companies from the manufacturing and non-manufacturing sectors responded to the survey, while 250 member companies participated in the Salary Survey for Non-Executives.
As well as the salary surveys, the MEF also launched the MEF Fringe Benefits Survey 2022 and the Analysis of Collective Agreements and Awards on Terms and Conditions of Employment 2021.
Boost to SME sector
A new initiative designed to boost the small and medium enterprises (SMEs) sector in Malaysia has been unveiled by Bursa Malaysia Bhd and the Companies Commission of Malaysia (SSM).
The two have signed a Memorandum of Understanding (MoU) to jointly explore commercial opportunities for both Bursa Malaysia (also known as the Exchange) and SSM that support Malaysia’s digital economy in particular.
Bursa Malaysia chief executive officer Muhamad Umar Swift said the three-year collaboration between the pair “provides the Exchange with a trusted partner both in terms of improving combined data capacity, as well as the opportunity in empowering the local business community through data and information sharing”.
He said: “In addition to building a centralised data system that connects businesses with the funding agencies, this collaboration will allow smaller businesses to learn from best practices from larger corporations.”
The new collaboration leverage the potential of Bursa Malaysia and SSM’s datasets to build a first-of-its-kind data ecosystem that supports Malaysia’s socio-economic development agenda, he added.
Chief Executive Officer of SSM, Nor Azimah Abdul Aziz, said: “SSM has a comprehensive data bank consisting of details on information relating to company and other business entities profiles, share capital, directors, officers, shareholders, charges and financial information.
“Through this MoU, information derived from this meaningful collaboration would be further analysed to create a holistic, inclusive and conducive data ecosystem that supports the overall Malaysia’s socio-economic development agenda, especially the SMEs that comprised of 99% of the corporate and business entities in our registries.”
Driving the Environmental, Social and Governance (ESG) agenda, Bursa Malaysia and SSM will work together to encourage corporate Malaysia to focus on improving disclosures and access to capital through ESG best practices, he added.