Kuala Lumpur, 14 April 2020 – IDEAS is deeply concerned with recent developments regarding the appointment of various politicians to head Government-Linked Companies (GLCs) and Statutory Bodies. Of particular concern is the statement from Minister in the Prime Minister’s Department and PAS Secretary-General YB Dato’ Takiyuddin Hassan, who recently said that all government MPs will be given the responsibility to manage GLCs. He further added that all of them are qualified because “they are MPs.”
Dato’ Takiyuddin’s statement is worrying as it displays the arbitrary nature of the appointment process for heads of GLCs and Statutory Bodies. It indicates that political affiliation may become the sole criteria in these appointments. It is well-established that appointing politically-linked individuals to head such entities creates room for cronyism, patronage, abuse of power and corruption. Furthermore, appointing MPs to head GLCs and Statutory Bodies also run the risk of becoming political rewards for electoral victory or in exchange of loyalty.
GLCs and Statutory Bodies are important elements in Malaysia’s developing economy with some of them serving social objectives for the Malaysian people. Therefore, we must ensure better corporate governance to bring transparency in running GLCs. What needs to be done is to build strong institutional frameworks that govern the overall management and performance of these GLCs and Statutory Bodies. This framework should include stringent procedures and guidelines on the appointment of Board Members and top management positions in all GLICs, GLCs and Statutory Bodies. These procedures must be entrenched in legislation to ensure compliance and should also ensure those who disregard them must not be allowed to get away with impunity.
IDEAS urges the government to utilise measures that already exist, for example, the Parliamentary Select Committee on Major Public Appointments and criteria that were set out in the GLC Transformation Programme in 2005. Until greater reforms are institutionalised, the government must take these steps to ensure its commitment towards greater transparency in the management of entities and assets it holds in the public’s trust.
In the long run, the government needs to exit from running businesses with some exceptions. It should develop a strategy to reduce the number and role of GLCs to improve the competitiveness of Malaysia’s economy and to unleash new sources of growth for all Malaysians.