What Does Nature of Business Mean?
- Chow Ping
- 2 days ago
- 3 min read
You're excited! You're ready to register your company with SSM.
You've got your business name picked out. Your partners are aligned. You’ve got the champagne ready.
Then you open the SSM Superform and hit that section. Three words that make you pause and squint:
"Nature of Business"
Your cursor hovers. Your confidence wavers.
What exactly does SSM want here? How detailed should you be? Can you mess this up?
(Spoiler: Yes, you can. And it might delay your entire incorporation.)
Don't worry — this isn't as scary as an LHDN audit. But it is one of those boring-but-crucial steps that can either speed up your approval or create unnecessary headaches.
Today, we're breaking down exactly what "nature of business" means, what SSM wants from you, and how to nail this section on your first try.
What Does "Nature of Business" Actually Mean?
Simply put, your "nature of business" is how you tell SSM — and by extension, the government, banks, and future partners — what your company actually does.
It's not a philosophy question. It's a practical classification that affects everything from tax treatment to licensing requirements.
When you incorporate with SSM, you need to provide two things:
Up to three MSIC codes
A long-form business description (up to 200 words)
Let’s dive deeper into what this means.
Provide up to three MSIC codes
Think back to your school days, filled with multiple-choice questions. This is just like that.
You're selecting from a standardised list of business categories.
MSIC stands for Malaysian Standard Industrial Classification.
These are pre-defined codes that categorize what your business does. You don't get to make them up — you pick from an official list.
Here are some examples:
About the MSIC codes, you're allowed to select up to three because, let's be honest, most businesses do more than one thing.
Maybe you manufacture products and sell them retail.
Maybe you provide consulting and training.
Maybe you read tarot cards and do corporate team building.
The three-code limit lets you capture that complexity.
But what happens when even three MSIC codes can't fully capture what your business does?
If this sounds like you, don't panic. That's exactly why the long-form description exists.
2. The long-form business description (up to 200 words)
This is the essay portion. Here's where you fill in the gaps and paint the complete picture.
You have up to 200 words to explain what your company does in plain language.
Just crack those knuckles and list out the facts. No biggie.
The business description is your chance to elaborate.
This section is especially important when:
Your three MSIC codes don't tell the whole story
You have unique or hybrid business activities
You're in a specialised industry with specific requirements (like private employment agencies)
Unlike MSIC codes, this part is subjective.
SSM officers read your description and decide whether it's clear, accurate, and complete.
Quality matters here. A lot. Do your best.
But save the creative writing for your company blog. SSM officers aren't here for plot twists.
What to do if your business nature changes
Companies evolve.
You might start as a consultancy and add training services. Or launch as a retailer and expand into K-pop Demon Hunters costumes for pet rabbits.
This is completely normal.
SSM calls this a "change in business particulars," and yes, you need to inform them.
This is what you do:
Your Company Secretary prepares a resolution
Shareholders approve the change
Inform SSM within 14 days of the change taking effect
Don't skip this step.
Operating outside your registered business nature can create compliance issues, especially during audits or when applying for licenses.
Did reading all these make you sigh and wish someone would do it all for you already?
Well, good news!
Because at Douglas Loh & Associates, we incorporate companies for a living. MSIC codes, business descriptions, SSM submissions — we do it all so you don't have to.
Want to focus on your business while we manage the boring paperpwork for you?
Comments