In Malaysia, “Berhad” is a term used to denote a type of public limited company. It’s often abbreviated as “Bhd.” and is commonly used in the names of companies to indicate that they are publicly listed entities on the Malaysian stock exchange. This designation signifies that the company’s shares are available for purchase and trading by the general public.
A Berhad company in Malaysia has several characteristics:
Just like in other forms of limited companies, shareholders’ liability is limited to the amount of capital they have invested in the company. Their personal assets are generally not at risk beyond their investment.
Berhad companies can offer their shares to the public through an initial public offering (IPO) and have their shares traded on the Bursa Malaysia, the country’s main stock exchange.
There is a minimum share capital requirement for a company to be incorporated as a Berhad. This amount may vary based on the nature of the company’s business.
Berhad companies are subject to stringent corporate governance and disclosure requirements imposed by regulatory authorities, aimed at protecting the interests of shareholders and promoting transparency.
Berhad companies must have a minimum number of shareholders (usually at least three) and a board of directors responsible for the company’s management and decision-making.
Berhad companies are required to publish annual reports, financial statements, and other relevant information to ensure transparency and accountability.
The use of “Berhad” in a company’s name is not just a formality; it signifies the company’s status as a publicly traded entity and its commitment to adhering to certain regulatory standards. This designation provides investors with some assurance about the company’s credibility, as publicly listed companies are subject to increased scrutiny compared to private companies.