Temasek Leadership Change

• lotus999

  18 Feb 09, 15:52

  i doubt he will be allowed to reveal more than what the gahmen want. Goodyear Will he bring change? He has run firms accountable to shareholders; does his presence signal leadership willingness for greater transparency? AWSJ comment. Feb 15, 2009 Wall Street Journal Asia. Singapore's state-owned investment fund Temasek announced a change in leadership last week to a non-Singaporean CEO. We hope his appointment heralds a new era of openness. Temasek manages public monies, yet much of what it does is hidden from the public it aims to serve. Its stated mission is "to create and maximise long-term shareholder value as an active investor and shareholder of successful enterprises." But to what end? To support Singaporeans in times of recession, like now? Government officials in the past said they are accumulating reserves for an unspecified "rainy day." In a speech this month, Senior Minister Goh Chok Tong said reserves should be used only "under dire circumstances when one-off extraordinary measures are required to ward off catastrophe or prevent irreparable damage to the economy." A spokesman tells us that, "Temasek's charter is to manage these investments independent of the Singapore government on a purely commercial basis in order to generate sustainable returns for the benefit of future generations." But who decides when to use the reserves, and under what metrics? Temasek's murky goals are part and parcel of Singapore Inc, where the line between public and private firms is often blurred. This corporatist approach worked for Singapore in its early years - though of course we'll never know whether the market might have done a better job. Temasek was set up in 1974 as a holding company to manage state-owned firms and has nurtured successful, world-class companies such as Singapore Airlines and DBS Group, a major bank. The current CEO, Ho Ching, is the wife of Prime Minister Lee Hsien Loong. Today, however, Singapore needs to develop a more vibrant private sector that encourages entrepreneurship and innovation. The city-state is in the throes of the worst recession in its modern history, with GDP forecast to contract as much as 5% this year. Expatriates are fleeing and the government, for the first time, is going to tap its reserves to the tune of S$4.9 billion (US$3.3 billion) to help fund a stimulus package. But if this is the "rainy day" Temasek is there for, why not give back the fund's piles of cash to taxpayers and let Singaporeans invest their own money? As of March 31 - its last public annual statement - Temasek's portfolio totalled S$185 billion. During the course of a parliamentary debate Tuesday, the government announced a 31% drop in the company's net portfolio value between March 31 and November 30 last year. The decline was not unexpected, given the world financial crisis and some poorly timed investments, including $5.8 billion in Merrill Lynch and £975 million ($2 billion) in Barclays. Temasek says it oversees its portfolio prudently. But it has never provided historical financials to back up its claim of an 18% compounded annual "total shareholder return" by "market value." Nor has it released detailed results showing how money flows among its subsidiaries, the holding company and its government shareholder. Temasek outlines its compensation arrangements but doesn't say how much it pays its top executives. Temasek is 100% government-owned and isn't required to release publicly audited financial statements. The President of Singapore must sign off on the "appointment or removal" of the CEO and board members, according to Temasek's annual report. It cannot "draw on or diminish our past reserves without the President's concurrence." So even while it is a "commercially disciplined investment firm," as the company says, Temasek still answers to the Singapore executive. This system would be more effective if Singapore boasted a more vibrant democracy with better checks and balances. All of which makes last week's change at the top of Temasek all the more intriguing, and an opportunity. Replacing Ms Ho in October will be American Charles "Chip" Goodyear, who will be Temasek's first foreign CEO in its 35-year history. Mr Goodyear is a Wall Street veteran - not always a compliment these days - and the former head of BHP Billiton, the world's largest mining firm. He has run firms accountable to their shareholders, and run them well. The hiring of a foreign CEO is a notable change, and we hope it's a signal that Temasek and Singapore's leaders understand the need for more transparency in the company's operations. The world is demanding more openness and accountability from sovereign-wealth funds, and the shareholder-voters of Singapore deserve nothing less. http://online.wsj.com/article/SB123436899991073375.html?mod=
• angel7030

  18 Feb 09, 16:08

  The whole world is in financial turmoil, whatever investment today is slashed by 1/3 if not by 1/2 or totally busted. GIC and Temasek are not to be spare, same goes to all enterprises and investing businesses. It is therefore, unfair to keep pinpointing to your own country sovereign investment, which in one way or the other, suffered the same situation as most financial insitutions around the world. Even GIC or temasek is making a loss from taking risk, it is still surviving without borrowing. Unlike most organisation in the west that need to be bail out or face closure

   

  However, having said all, GIC and Temasek are still in paper lost, not real lost yet. And our Govt are still giving job credits, educations, skill upgrading, rebates and retraining to sustain this crisis, now you tell me, which countries gives rebates, help citizens to find jobs and with free skill upgrading and pay too?

• lotus999

  18 Feb 09, 16:16

  nobody is blaming them for the investment losses. we're now talking about transparency and accountability.
• redDUST

  18 Feb 09, 16:34

  say what you want, the timing and the action taken by temasek and gic are stuff of homer simpson.

  the crack signs are ominous when they pumped billions in. i am not sure if they are ill-advised or are super-confident of their decision when they decided to jumped in as saviour.

  their response to this fiasco is also super arrogant; that they can withstand such hits for even 2-3 cycles and still be ok. having money is one thing; continue to be stupid and having this invincibility midset is quite another. it can be disastrous. 

  it is really unfortunate that none of the these keepers of singapore's monies came forward and admit to having made poor judgement in the recent investments.

  this continued denial by these bunch of clowns will only plunge singapore into more follies in the future. and in the end, the loser are singaporeans.

• angel7030

  18 Feb 09, 17:05

  Originally posted by lotus999:

  nobody is blaming them for the investment losses. we’re now talking about transparency and accountability.

  
  what transparency and accountability are you toking about in a capitalism society, you know how the going concern acccounting run or not?? which organisations will give you full transparency and mind you, nobody is accountability for the losses accept the lost of his/her job. This is a capitalism commerce, organisation itself is a living body that breathe business of profit and lost in and out everyday, nobody goes to jail if the living body get sick or die, peoples will just lost their jobs.

   

  And even they give you the transparency, are you still believeing it as real or massaged??? You can alway ask for their statement of account to view on, and unless you are holding 50% and above of shares you get the board transparency.