It is prudent for businesses to reassess employment contracts, work policies, and benefit structures to ensure compliance and maintain workforce morale. These legal changes are more than compliance requirements—they shape how businesses engage with customers, employees, and stakeholders. By understanding and proactively responding to these trends, companies can secure competitive advantages while reducing legal risks. Are your strategies aligned with these changes?
Managing Partner of Ravindran Advocates & Solicitors I Business Lawyer | Adjudicator | Board Member I Founding Member, Lean In Malaysia
THREE LEGAL TRENDS MALAYSIAN BUSINESSES SHOULD WATCH IN 2025 As we kick off the new year, staying ahead of legal trends is essential for businesses operating in Malaysia. Here are three key areas to keep an eye on in 2025: 1. Data Privacy and Cybersecurity Compliance The Personal Data Protection Act 2010 (PDPA), recently amended, has introduced stricter requirements for data controllers and processors, including mandatory data breach notifications and increased penalties for non-compliance. The amendments also include extraterritorial provisions, which mean even foreign businesses processing Malaysian data are subject to the law. Additionally, the Cybersecurity Bill—expected to be enacted in 2025—will likely impose further obligations on businesses to strengthen cybersecurity measures and report incidents promptly. Businesses must invest in robust data protection measures, update privacy policies, and provide employee training to mitigate risks of breaches and penalties. 2. ESG Reporting Bursa Malaysia has expanded the Main Market Listing Requirements to include enhanced sustainability reporting under the Sustainability Reporting Framework. These disclosures now require more granular reporting on climate risks, carbon emissions, and social impact metrics, aligning with international standards such as the Task Force on Climate-Related Financial Disclosures (TCFD). For non-listed companies, voluntary compliance with frameworks like the Malaysian Code on Corporate Governance (MCCG) is increasingly becoming an industry expectation. Certain businesses will be required to conduct ESG audits, establish reporting systems, and integrate sustainability into corporate strategy to attract investors and meet stakeholder expectations. 3. Labour Law Reforms The recent amendments to the Employment Act 1955, which came into effect in January 2023, continue to ripple through workplaces. Key changes include reduced working hours (from 48 to 45 hours per week), expanded maternity and paternity leave, and protections for contract workers. Additionally, discussions on legislating rights for gig and platform workers under a new Gig Economy Bill may result in businesses being required to provide social security contributions (e.g., SOCSO under the Self-Employment Social Security Act 2017). It is prudent for businesses to reassess employment contracts, work policies, and benefit structures to ensure compliance and maintain workforce morale. Why This Matters These legal changes are more than compliance requirements—they shape how businesses engage with customers, employees, and stakeholders. By understanding and proactively responding to these trends, companies can secure competitive advantages while reducing legal risks. Are your strategies aligned with these changes?