Constitutional amendment to prohibit MPs getting involved in business

Written by Jeyaseelen Anthony, CPIAsia

Commentary

The National Feedlot Corporation (NFC) scandal and the Port Klang Free Trade Zone (PKFZ) fiasco have raised many concerns about transparency and corporate governance and its importance in promoting an honest sustainable corporate culture in Malaysia.

The recent NFC and PKFZ fiasco has shown us how elected representatives and political leaders have allowed themselves to profit from questionable business dealings by way of patronage and by assuming positions in companies where they may derive profit.

The constitutional requirement in Article 48(1) (c) of the Federal Constitution provides that elected representatives in Parliament are prohibited from holding any office of profit. If an MP is found to hold an office of profit before the election then the election is null and void, and if the MP is found to hold an office of profit after election then the seat becomes automatically vacant.

The meaning of an 'office profit' under the Constitution is a position in the public service where an income is derived. For all and intents and purpose, this definition is too restrictive and is not keeping up with times. Society and politics has changed a great deal since 1957. Today any public office wields power in the sense that MPs, especially those in government, have an advantage in influencing the procurement of business contracts and businessman are often attracted to this and thereby offering them lucrative positions as directors in their companies.

Even companies are set up by the elected representatives themselves to bid for lucrative government projects and tenders and in most cases they have an unfair advantage over the other bidders because of the power that they wield from their position as an MP in the government for e.g. if they are Ministers and Deputy Ministers in a particular government ministry.

The Federal Constitution was drafted in 1957 and the drafters of the constitution would not have envisaged a situation like this at that time. As such the meaning of office of profit in the Federal Constitution should not only include positions in the public service but also positions in the corporate sector.

With this in mind and in light of the NFC and PKFZ scandal, I believe that if Pakatan Rakyat or the Barisan Nasional comes into power with a two thirds majority, the first thing that they should do is to amend the Federal Constitution to state that elected representatives, senators included, are not allowed to hold any position in any company which may expose them to derive profit from business ventures.

At the risk of being too idealistic, this prohibition may even be made to extend to immediate family members of the elected representative if there is a need for it. They must also be made to declare their interest in any company before offering themselves as a candidate. If the candidate has an interest in any company then he is disqualified from standing for elections.

Today we continue to see many of our elected representatives sitting (especially those holding ministerial positions) in the boards of companies as independent directors, non-independent directors and even CEOs of some companies, all deriving profit in some way or another. One only needs to peruse annual reports of these companies to realize this.

The reason for such an amendment is quite obvious as it is clear that business should be left to the businessmen as MPs are not businessman. They are voted into Parliament by the people to serve only the people and not any business venture. That should be the message the Constitution has to put forward.

Elected representatives should only be concerned with proposing legislative changes in Parliament, debating on proposed legislation, raising the aspirations and wants of the people in Parliament and serving their constituents. They are paid to do the job.

An amendment like this would weed out candidates for public office who come into politics, merely to seek monetary gains. I will go so far as to say that even State Constitutions must be amended to include such a provision to apply to candidates seeking election to the State Legislative Assembly and also to serving elected representatives in the State Assemblies.

A study conducted by two American academics in 1974 about our elected representatives found that:

"Malaysian MPs consider it their responsibility to represent the voters and the special interest groups in their constituencies, to educate their constituents about development programmes, to listen attentively to complaints, to attend meeting in their constituencies at which suggestions can be processed, and to communicate back to the centre those matters that resist settlement at local levels".

The conclusion of the study above clearly highlights the role of an MP. It is important for potential MPs and serving MPs to realize this and stay away from business ventures.

The writer is a Consultant Fellow attached to the Faculty of Law, University Malaya and a local councillor at Majlis Bandaraya Petaling Jaya.