Blow-by-Blow Analysis of the Malaysian Student Leaders Summit (Pt 2)

Okay, let me try to write as much as possible this time. This was pretty long. I don’t want to get stuck down with episode 4 or 5, and its already a week past the conference I don’t think anybody cares anymore. I am also pleased to announce I have photos! Delectably taken from Facebook albums, with permission from Poh Teck Kang.

Shot at 2007-08-11

Corporate Governance and Transparency in Malaysia

Moderator: Mr. Ho Kay Tat (Group Chief Editor, The Edge Malaysia)
Speakers: YM Tunku Abdul Aziz Tunku Ibrahim (Former President of Transparency Malaysia); Dato’ Zarinah Anwar (Chairman, Securities Commission)

First speaker up: The YM Tunku Abdul Aziz.

He started his speech by quoting Khun Anand Panyarachun, the former prime minister of Thailand (1991-1992) who he said was a very liberal leader, which the king of Thailand asked to serve his country as the PM. The quote was,

“Good governance is about putting in place the mechanisms to define what constitutes the public interest and to see that the public interest is served despite everything else.” Anad Panyarachun

He also refered to the book authored by Steve Young, Moral Capitalism.

He said that external pressure leave [Malaysia] no choice. In a globalized economy, capital ranges free and impersonally, and moral capitalism can be a part of good governance or merely a dream. I suppose what he means to say here is that global capital and FDI will not show pity or sympathy to Malaysian poverty and plight. Capital can come here because there is good governance and transparency, or it can come here and be exploited by elite business interests that do not serve the public good.

In his view, when corruption is tolerated as a business necessity, then it is the first short step to national degradation. A slippery slope argument, perhaps, but nonetheless pertinent. I wish to add something my lecturer once said to me in class: Malaysia is corrupt, but corrupt in a very reliable way. If you paid them off to get something done, you could rely on them to have it done. In comparison, in other countries, you could pay them off but they could change their minds at the very last minute.

He praised Dato’ Zarinah Anwar highly, mentioning that since her stewardship at the Securities Commission, standards of corporate behaviour has improved tremendously. He mentioned that leadership is service in the public’s duty and all of us are leaders. As in, leadership is serving a duty towards the public, and by this definition everybody is a “leader”, its our scope that differs.

Technology cannot change the abuse of trust. Many people in authority do not understand the concept of stewardship and trust. My take: no, the abuse of trust happens as much as poverty or crime being ineradicable. Technology, while making information dissemination and surveillance easier, must be implemented to full advantage before plays a part in policing and balancing forces in society. (Any technology must be implemented and used for whatever purpose before it becomes useful.) It will take some political action because (leaders of) companies don’t want to be watched.

Second Speaker: Dato’ Zarinah Anwar.

Dato’ Zarinah Anwar argument was: transparency and trust are critical to this nation which depends so much on foreign investment because investors are more likely to vote with their feet. If conditions here are bad, they’ll just invest somewhere else. No market can be complacent in ensuring the efficiency of the capital market.

But she also had a moral argument: trust and investment will prevail when duty and obligations of stewardship is not subordinate to greed, which will erode confidence levels, which is the foundation of capital markets. We need to promote shareholder activism and watchdogs.

Good corporate governance is beyond mere compliance and ethics . It is upholding collective standards and taking personal responsibility. It will translate into results which will create additional value for shareholders. SHe also mentioned that the AFN prepcitated the Malaysian Code of Corporate Governance in 2000, which [will lead? has led?] to a masterplan… can’t remember, no notes.

With regards to the Q&A session, The questions were:

1. With corruption afflicted every level of society, do we need a white knight to clean up the system?
   The response to it was, “All of us must be white knights.”
2. Because of the majority rule in governance, should we legislate minority shareholder rights?
   The response was, “There are sufficient laws and regulations. We shouldn’t just look at authority. Its the problem of enforcement: shareholders may have rights, but enforcement is not there. If companies infringe on rights, then the market must show abhorrence and not tolerate it. Dump your shares if you feel your company is not run properly.”
3. The Public is tired and outraged at the inefficiency of the Anti-Corruption Agency. Should it be put under the supervision of parliament?
   The response of Tunku was “It should be put under multiparty supervision, with both government and opposition leaders. ACA in its current form is weak. Once, the Attorney-General asked ACA to stop an investigation, and they did. Yet, the A-G has no jurisdiction with the ACA. Therefore, the whole position of the A-G should come under review.”
4. Malaysia is not ready for transparency, as enshrined in the legislature (Official Secrets Act). How do we move on?
   The response was, “When there is no transparency, there is no accountability. THe government will soon consider it necessary to remove the OSA.” Tunku also added that it took Japan 20 years to remove its official secrets act.

The session ended with a quip, “Ethics is knowing that cheating on your wife is wrong. Morality is when you don’t cheat on your wife.”
That’s basically all I can remember and all my notes of the session. Its difficult for me to reflect critically knowing very little about corporate governance. On the more cynical side, maybe the whole session was to assure people that there were people making a difference in Malaysia; and you could too. You could also be one of those people, when you’re a CEO of a big company, be part of Malaysia and making it stand tall and great.

I do believe that one person did ask: what can we do in order to ensure good corporate governance and transparency. Essentially its a political question. Its fortunate for Dato’ Zarinah Anwar, has got into a position of authority to make the relevant changes. But for the public to safeguard their interests in Malaysia, we need to maintain constant vigilance, which entails proper laws an a system for protecting whistleblowers and watchdog groups… which eventually needs to be lobbied to government. If Dato’ Zarinah goes, can we rely on her successor?

Then question is, will government accept that “western” model of balancing between public and private interests? Or is there another “third” way?

Corporate Challenges for the Young and Bright

Shot at 2007-08-14

Dato Johan Raslan, Dato Tony Fernandes

Okay, this session wasn’t very academic; it was speech-making in its purest form. “Corporate challenges for the young and bright” really means “a little bit about what you’ll face when you’re working”. At best, it was highly motivational, especially hearing about Dato’ Fernandes, who could have carved out his own life overseas but instead came back, probably out of a mixture of profit possibility, cultural relations and patriotism. It is also good to hear that you can be successful in Malaysia despite having no heavy political connections. (But ultimately he did rely on one.) That’s essentially the story of his success that he presented to us on that day.

Dato’ Johan Raslan showed us what are the popular issues in the corporate world today. He began by making a note that its a universal truth that the previous generation had it easy, still is lazy, and had screwed up. This generation will clean it up and sort it all up. But the next generation has it easy, is lazy and are going to screw up.

He talked about five values to help succeed in going forward, about the new finance minister of Malaysia who was appointed last year, about BRIC (B.. Russia, India and China), GLC transformation, etc. What was NO LONGER in currency was crony capitalism, status quo, a job for life, dominant CEOs, and “little Malaysia”. What’s IN:

• Profit managers
• Corporate accountability
• Crossing Borders
• Transforming mindset
• Software vs. Hardware
• Global perspective
• Servant leaders
• Gen Y challenges.

Issues include retaining and rewarding talent, and removing detriments. Malaysia is inexperienced with cross-border investments, and doesn’t have the expertise in investing abroad without losing money. He talked about redefining the value system, and about connectivity, connecting people, partners and networks, not competitors.

I’ve only got four out of his five values:

1. Strategic vision: remember to make long-term plans, and contribute to your person. Don’t job hop because it adds an extra line to your CV but instead stay in a company for 2-3 years so that you learn new skills and benefit from a variety of experiences.
2. Focus and perserverance
3. EQ and IQ: Further up the command chain, it is vital that leaders know how to persuade and communicate.
4. Ethical behaviour: unless you’re incredibly rich, all you have is your education, your good name and (couldn’t get it). So behave, unless you want to lose your good name.

Tony Fernandes: I didn’t take any notes, I just listened to him make jokes about his history with Airasia. So I’m just recounting purely out of memory, except for this quote:

On knowing your market. “I know Malaysians. If its cheap enough, they will risk their lives. 800 ringgit to KK, ‘no lah, got SARS.’ 88 ringgit, ‘Lets go!’”

Anyway, he started out as a musician with Virgin Records, with Sir Richard Branson, and which got taken over thrice, which final company was AOL Time Warner. He got sick of it, so he left to Malaysia to manage a recording studio (I think). Then he got this brilliant idea on starting a budget airline in Malaysia, told his wife, and told her he was serious after she finished laughing. So he told his friends, (after the customary 5 minutes of laughter), he got together prices and operational costs off the internet, put together a proposal, and after a long ordeal got to see the Prime Minister, who was then Tun Dr. Mahathir. Apparently, he was not in a good mood because before that he had to meet MAS (which was in trouble at that time) and another meeting with Lim Kit Siang. So he got a deal, which was he couldn’t start a new airline, but PNB so happened to have a failing one, so he bought it off them for a customary RM1. Then the rest is history.

Anybody really ought to listen to speak. He has this “AAAAAHHHH” that half sounds like a “i-don’t-know uh” and an Ernie-and-Bert stuttered laugh, that serves very well as a joke indicator.

Okay, will try to finish as much as possible soon.

More:

Part 1