Are you a shareholder of a Malaysian Sdn Bhd and wondering if you can legally remove a director? Maybe you’re facing internal disputes, inactive directors, or want to restructure the company board.
This guide from Boss Boleh explains when and how a director can be removed——including what happens if you own 51% of the shares, and why sometimes an Extraordinary General Meeting (EGM) is required.
✅ Can a Shareholder Remove a Director in Malaysia?
Yes. Under Section 206(1) of the Companies Act 2016, a company director can be removed by ordinary resolution of the shareholders —— even if they are appointed for life or under contract.
Ordinary resolution= more than 50% of shareholders present and voting.
So if you own 51% of the company, you have the power to remove director, provided all legal procedure are followed.
✅ When Do You Need to Call an EGM?
You’ll need to call an Extraordinary General Meeting (EGM) if:
- The company’s AGM is far away or already passed
- There is an urgent situation (e.g. misconduct, deadlock)
- The matter of removal is not included in any scheduled meeting
Calling an EGM allows shareholders to decide on special matters, such as director removal, by passing a resolution.
✅ Steps to Remove a Director (Sdn Bhd Malaysia)
Boss Boleh recommends the following compliant procedure:
| Step | Action | Law |
| 1️⃣ | Review Constitution | Some companies have custom rules for removal |
| 2️⃣ | Serve Special Notice (28 days before EGM) | Required under s.206(3) CA 2016 |
| 3️⃣ | Company issues EGM Notice (21 days to shareholders) | Refer to s.316 |
| 4️⃣ | Inform the Director | Director must be allowed to reply or speak (s.206(4)) |
| 5️⃣ | Hold the EGM & pass ordinary resolution | 51% is enough to approve |
| 6️⃣ | File changes to SSM within 14 days | Form under Section 58(1) — mandatory |
| 7️⃣ | Update the company’s Register of Directors (ROM) | Company Secretary to act immediately |
⚖️ What If I Hold 51% Shares?
| Question | Answer |
| Can I remove a director? | ✅ Yes, via ordinary resolution |
| Do I need to wait for AGM? | ❌ No — EGM can be called anytime |
| Is 75% needed? | ❌ No — 51% is sufficient unless Constitution says otherwise |
| Can the director object? | ✅ They can make written or verbal representations under the law |
| Is filing with SSM required? | ✅ Yes — within 14 days (s.58 CA 2016) |
⚠️ Legal Risk & Penalties
| Mistake | Risk |
| ❌ No special notice served | 🔴 Removal may be invalid (s.206(3)) |
| ❌ SSM not updated | 🔴 Fine up to RM50,000 under s.58(3) |
| ❌ No fair hearing for director | 🟠 Legal challenge risk by removed director |
🧾 Boss Boleh’s Summary:
| Scenario | Action |
| You hold 51% shares | ✅ You can remove a director by EGM |
| You need urgent action | ✅ Call an EGM with 28 days’ special notice |
| Unsure about legal steps? | 🟢 Let Boss Boleh handle it end-to-end |
🧑💼 Why Choose Boss Boleh as Your Company Secretary in Malaysia?
BossBoleh.com is trusted by SMEs and startups across Malaysia for:
✅ Professional company secretarial services
✅ Director removal & restructuring advice
✅ Drafting of notices, resolutions & filings
✅ Full compliance with the Companies Act 2016
📞 Need to remove a director from your Sdn. Bhd.?
Get in touch today for a FREE eligibility check. We’ll ensure the process is legal, low-risk, and professionally managed.
Want to learn more about managing your business structure the right way? 💼
Join our FREE webinar! We’ll walk you through compliance essentials and how to convert from Enterprise to Sdn Bhd with confidence.
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