Of all people, why Khalid as Prasarana chief?

QUESTION TIME | Khalid Abu Bakar’s highly questionable stint as inspector-general of police has been followed by a highly questionable appointment, which can only be a reward of sorts for service to the government of the day.

Khalid’s appointment as chairperson of Prasarana Malaysia Bhd, a government-owned company engaged in Malaysia’s complex transport operations including many parts of Kuala Lumpur’s mass rapid transit system, by Prime Minister Najib Razak defies logic and plain common sense.

But it follows the long tradition in Malaysia of appointing government loyalists to key positions with no thought of whether they are suited or not for the position and can do their jobs well given their background, qualifications and experience.

Before we go on to list some of Najib’s dubious recent appointments, let’s look at why Khalid is most unsuited for the position of Prasarana chairperson. First some words on Prasarana.

This is the company tasked with taking over billions of ringgit of assets relating to Kuala Lumpur’s transport infrastructure as well as other similar projects across the country. It has billions of ringgit in assets, billions in borrowings and billions in losses. It does not disclose its financial results.

Despite the mess Prasarana is in here in Malaysia, it is eyeing a RM55 billion rail project in Saudi Arabia, according to press reports, and other overseas projects.

Khalid, by most accounts, did not have a distinguished career in the police force. He is not particularly noted for anything great that has been done. You can read his profile, filled with unsubstantiated praise, at the police website here. His qualifications are listed as OSC/MCE/SPM and LLB Honours Universiti Islam Antarabangsa.

He was a career police officer and as far as is known has worked nowhere else. He does have any corporate experience whatsoever and does not have the background, qualification and understanding necessary to be the chairperson of a company which has billions in assets, borrowings and losses.

The chairperson of a company such as Prasarana carries with it enormous responsibilities given the scale of its operations, which is equivalent to any large public-listed company. Here are key responsibilities of the chairperson drawn from the Malaysian Code on Corporate Governance:

• providing leadership for the board so that the board can perform its responsibilities effectively; setting the board agenda and ensuring that board members receive complete and accurate information in a timely manner;
   
• leading board meetings and discussions;
   
• encouraging active participation and allowing dissenting views to be freely expressed; managing the interface between board and management;
   
• ensuring appropriate steps are taken to provide effective communication with stakeholders and that their views are communicated to the board as a whole;
   
• leading the board in establishing and monitoring good corporate governance practices in the company;
   
• and leading the board in its collective oversight of management, while the CEO focuses on the business and day-to-day management of the company.

How is any IGP, let alone Khalid, going to live up to those demands. If he fails, the one to blame is the person who put him up there in the first place.

Other questionable picks

It is clear from the list of chairperson’s responsibilities, and especially for a highly complex company which is already in deep trouble, he or she has to be a person who is well-versed with corporate matters.

An ideal person for a position like that would be a respected retired CEO of a large company and not just anyone who is being rewarded for his service in government or for any other purpose other than the interest of the company and its stakeholders.

Among other qualified people would be accounting and other professionals who are well-versed with how companies are run, as well as governance and oversight matters and how they are implemented.

Appointing ill-qualified people to the important position of chairperson of an important company, one which is struggling with debts and losses, is a sure recipe for even more disaster in future as these people have no idea of what it takes to turn a company around and keep it on the straight and narrow.

Look at Najib’s other major appointment - that of former Negeri Sembilan menteri besar Isa Samad - as chairperson of Felda Holdings and FGV, two major corporate entities, of which the later was listed. Isa was an unlikely candidate - a politician who was found guilty of money politics and suspended from Umno.

But he found life again at Felda and FGV and in the process caused major damage at both, being replaced respectively by another politician, Shahrir Samad, and former civil servant Sulaiman Mahbob. It is arguable whether even Sharir and Sulaiman are appropriate replacements for Isa.

Isa now stands accused of corruption by the MACC which detained him for a few days in their lock-up but continues to remain acting chairperson of the Land Public Transport Commission or Spad, another appointment which is highly questionable after his poor performance at Felda and FGV.

The bottom line is that if the government is serious about government companies being successful, they have to appoint chairpersons and CEOs who are competent, have a great track record and the willingness to bring about change. And then set them targets and give them a free hand to achieve them.

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P GUNASEGARAM says a government which is unwilling to change its corporations for the better does not serve the people. E-mail: t.p.guna@gmail.com. - Mkini