IDEAS is deeply concerned about recent developments regarding the appointment of politicians to head government-linked companies (GLCs) and statutory bodies.

Of particular concern is the statement by Minister in the Prime Minister’s Department and PAS secretary-general Takiyuddin Hassan that all government MPs will be given the responsibility to manage GLCs. He said all of them are qualified because “they are MPs”.

Takiyuddin’s statement is worrying as it displays the arbitrary nature of the appointment process for the heads of GLCs and statutory bodies. It indicates that political affiliation may become the sole criterion 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 runs the risk of these posts becoming rewards for electoral victories or in exchange for 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 to the running of GLCs.

What’s needed is to build strong institutional frameworks that govern the overall management and performance of GLCs and statutory bodies. These frameworks should include stringent procedures and guidelines on appointments to the board and top management positions at all GLCs and statutory bodies. These procedures must be entrenched in legislation to ensure compliance, and that those who disregard them are not 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 the criteria set out in the GLC Transformation Programme in 2005. Until greater reforms are institutionalised, the government must take these steps to ensure its commitment to greater transparency in the management of the 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. – April 14, 2020.

* Ideas is a policy research organisation.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.