GEORGE TOWN: A book on how much bosses and directors of government-linked entities (GLEs) are paid shows most earning lavish incomes and walking away with hefty bonuses and retirement gifts in the form of luxury cars, despite the companies not doing that well.
This was revealed in “How much is Hidden?: Pay for Elites in GLEs”, published by the Consumers’ Association of Penang (CAP), and written by finance academics Marizah Minhat and Nazam Dzolkarnaini.
The authors, who are Malaysian professors at a Scottish university, sieved through data from disclosures by the GLEs, which include government-linked investment companies and government-linked companies.
Marizah, in revealing interesting bits from their book, found that in 2017, executive directors and CEOs of GLEs were paid an average monthly salary that could pay 308 people a minimum wage of RM1,100.
She said salaries for non-executive directors of GLEs also went up by 20% from 2016 to 2017. She said this was at an inopportune time when the average pay increase for most Malaysians was at 7.7%.
Marizah said bonuses given to top heads of GLEs were mind-boggling.
She said big bosses of SP Setia, IHH Healthcare and Telekom Malaysia walked away with bonuses of between 433% and 618% of their salaries in the 2015-2017 period.
Marizah said the data was gleaned through very limited information, as the GLEs were not too clear with their declarations.
She said the secretive nature of the GLEs in revealing how much their directors earn must end as the entities have essentially benefited from taxpayers’ monies.
She said this breeds incompetence and leads to the downfall of the GLEs as the directors received a fixed income, bonuses and stock options, with the public not having any account of how well they are doing.
Marizah said by laying bare the full salaries and benefits of each director, taxpayers can then scrutinise and hold these personalities accountable and ensure they get their money’s worth.
“The public is made of the many, not only a few, elites who’re managing and governing the running of GLEs,” she said.
She said GLEs such as Malaysia Airlines, Tabung Haji, Felda Global Ventures and 1MDB are prime examples of companies which were underperforming and operating in their comfort zones.
She said such companies are in comfort zones as they were often bailed out during trouble.
Marizah said their research also showed a bank related to Tabung Haji presenting a luxury car priced over RM250,000 to a retiring official as a parting gift.
“Despite the fact that we do not own any shares of the companies, we as the rakyat deserve to know how they are paid because they involve government money. We are the ultimate stakeholders of the GLEs.
“The data we have in this book is gleaned from limited data and based on the opinion of the data collector. We do not know how much is hidden.
“It was not easy for us to release this book; there have been many inconsistencies in pay declarations. Salaries and other perks are often lumped together, or mentioned in aggregate form,” she said.
Marizah said one example was Petronas, where in 2017 it declared that it paid RM21 million to five directors, but without giving a breakdown of how much was paid to each of the directors.
She said GLEs get away without giving full disclosures, despite benefiting from public resources as there were no requirements to do so.
Marizah said the government should make sure that all GLE directors’ pay is disclosed in a table format, breaking down every component of the pay, including stock options.
“The government should make sure that there is a standardised pay disclosure format for all GLEs, which could be modelled along the lines of the UK’s Directors’ Remuneration Report Regulations.”
Marizah’s book will be available in major bookstores in the next two weeks or those interested can buy a copy at CAP’s offices at Jalan Masjid Negeri (via Jalan Kennedy) at RM25.
Source : https://www.freemalaysiatoday.com/category/nation/2019/10/17/bigwigs-in-govt-linked-entities-raking-in-big-bucks-reveals-new-book/?fbclid=IwAR2eQVCZUiE69cAFE3cYARATAA7aZjL3Eaalcr5ulzeTGDCFutld4hoCgTU