The chief executives of Penang and Selangor have both denied claims that their states discriminate against certain companies due to their political affiliations.

Penang Chief Minister Lim Guan Eng said cabinet minister Abdul Rahman Dahlan should prove his claim that his administration "blacklist" companies in this way and refuse to do business with them.

"This is slander. I hope he shows proof. If he has proof, show it to us. Don't slander.

"I think he is trying to divert attention from criticisms of Budget 2017," Lim told reporters at the Parliament lobby today.

Similarly, Selangor Menteri Besar Azmin Ali said his administration operates on a transparent basis and would not discriminate any business based on political inclinations.

"He should show proof. Our policy is transparent. It is not wrong (for companies) to support and promote civil society (objectives).

"They are part of the democratic system," he said.

Rahman had made the allegation over the past two days in stating his support of Utusan Malaysia's suggestion that Putrajaya impose a "blacklist" for companies which sponsors electoral reforms pressure group Bersih.

The Malay daily had argued that Putrajaya should not award contracts or have any business dealings with such companies. No companies were named.

Following this, Rahman said he will instruct the Economic Planning Unit, which is part of his portfolio, to run background checks on companies.

He then alleged that Penang and Selangor discriminates against companies which were supportive of their political opponents.