After GE14, several Government-Linked Companies’ (GLC) person-in-charges have resigned and one of them has been discovered to be employed with extremely high salary; this shows that the management of the former government towards GLC lacked of transparency and effective supervision and resulted that most of the GLC’s person-in-charges as well as the GLC’s performance have gradually lost the confidence of the public.
In the past, the appointment of GLC’s management as well as its operation and profits were not governed by Parliament. A Select Committee named JP-ABAS had been established by the Selangor’s State Assembly in 2013 and it was only empowered to audit the operations, performance and financial management of the state’s GLC.
I believe now is the best timing to change the GLC’s supervisory mechanism and the points below will show how to improve the said mechanism in order to effectively supervise GLC:
Transparent and fair procedures should be used in hiring and selecting the board of directors and key candidates for the management’s positions of GLC. Political appointment should be abolished accordingly. The Key Performance Indicator (KPI) and Return On Investment (ROI) should be set up according to industry standard for GLC’s management in order to ensure public benefit while they are fulfilling their corporate social responsibility.
The Committee should be affiliated to Parliament, but in order to comply with the basis of law, the Committee will still be required to provide recommendation of appointment or removal of person-in-charge of related GLC’s management’s position to the ministers of the department who hold the significant part of the equity capital of the said GLC.
Parliament should also revise related rules and regulations in order to empower the Committee to disclose the personal salary and benefits enjoyed by the board of directors and key members of GLC’s management to public.
Since the states’ government own several GLC so state level’s “Select and Audit Committee” shall also be established for hiring and selecting the board of directors and key candidates for the GLC’s management’s positions and political appointment should also be abolished. The establishment of the Committee will also help in avoidance of power abuse and investment loss since the GLC will be supervised.
The development of country requires the contribution of professionals and nowadays, there are around 1.8 million Malaysian who staying abroad and some of them are recognised world-class top professionals in different areas.
The “Select and Audit Committee” shall collaborate with embassies and consulates of Malaysia around the world, Talent Corp and others related institution as well as open up the positions of GLC’s board of directors and key management for application, actively call on the return of Malaysian Professionals from overseas to hold those key positions and contribute in order to develop the country. This strategic will also help in reducing the GLC to be affected by political factors.
GIC are actually a “double-edged sword” which is used by our country to reasonably intervene the market economic activities – while GLC are helping the country with the development in multi-areas such as telecommunication, energy, banking, real estate and medical to provide better service and better life for the public but due to the lack of transparency and effective supervision, both the strategic as well as the GLC have gradually lost the confidence of the public.
Therefore, an appropriate intervention of government in this regard will help in achieving better market control.
Lastly, I urge Parliament and State Assembly to carefully study this issue and establish the “Select and Audit Committee” as soon as possible.