The Rise and Fall of Capital: Corporate Malaysia in Historical Perspective

Abstract

This article argues that better informed insights into the benefits and repercussions of the form of development of East Asian economies could be obtained when the theoretical perspectives from two different bodies of literature are employed collectively. If the concepts from the discipline of political economy, specifically the body of literature dealing with the developmental state now commonly deployed in analyses of East Asian economies, is used in combination with concepts from the literature on business history based on the work of Alfred Chandler, the reasons for the rise and fall of major enterprises in East Asia can be better understood. A case study of enterprise and economic development in Malaysia is presented to substantiate this argument.

Family Firms and Brand Products in Malaysia: Originality, Productivity and Sustainability

“…The Russell family, however, managed to maintain ownership and control of the company by incorporating a government-owned institutional investor as a major shareholder, one that did not interfere with the management of the firm yet allowed Boh Plantations to maintain cordial though arms-length relations with the state. Since targeting under affirmative action has significantly re-shaped corporate ownership and control patterns, non-Bumiputeras have been reluctant to invest in R&D for fear that their firms may be appropriated by the state during redistribution endeavours to alleviate inter-ethnic wealth inequities (Gomez 1999(Gomez , 2009Jesudason 1989;Searle 1999 …”

“…In Japan, the keiretsu system was instituted, while the emphasis of the Taiwanese state was on nurturing small and medium-scale enterprises (Wade 1990). In South Korea, Indonesia, Thailand and Malaysia, well-connected firms adopted a conglomerate pattern of growth (Amsden 1989;Gomez 2009;Rodan et al 1997). In all these Asian countries, the companies privy to state patronage were primarily family owned (Gomez 1999;Jesudason 1989;Searle 1999).…”

Socioemotional Wealth and Firms’ Control: Evidence from Malaysian Chinese Owned Companies

“…In general, the Malaysian economic system is regarded as a state-directed economy. Malaysian Chinese entrepreneurs are discontent with the corporate ownership restrictions imposed by the New Economic Policy (NEP) in Malaysia (Gomez 2009). In addition, the establishment of state-owned enterprises under the NEP has threatened the dominant ownership position of Malaysian Chinese entrepreneurs in the corporate sectors.…”

“…Firstly, we argue that capital intensive manufacturing firms may induce close monitoring or intervention by their non-dominant large shareholders to prevent the appropriation of the firms' assets by the family owners. Secondly, the NEP has restricted the Malaysian Chinese entrepreneurs in their attempts to increase their ownership in newly established manufacturing firms (Gomez 2009). …”

Overview of ASEAN Environment, Transboundary Haze Pollution Agreement and Public Health

“…Hence, it is common amongst the highest-ranking Indonesian plantation industries to have "functional directors" and "advisors" do "extra-economic functions" (Gomez 2009). Patron-client relationships, which are widespread inside the sector (Aggarwal and Chow 2010), support numerous direct relationships of politicians in office to these plantation benefits.…”