Malaysia: GLCs Need To Improve in Transformation Programmes

Government-linked companies (GLC) need to progress further to sustain their performance and meet the transformation programme objectives by 2015, according to a report released by the Finance Ministry recently. Launched in 2004, the 10-year GLC Transformation programme is a bid to raise GLC performance to be on par with domestic competitors, and to also have them developing into regional or global champions by 2015.

The programme currently focusses on institutionalising best practices on financial and operational matters across all GLCs. The roles of change agents, which include the senior management, the boards, government-linked investment companies, the government and the Putrajaya Committee need to keep pace with the rapid changes in the business environment.

The report was quoted as stating:

It is critical to continually reaffirm its mandate, focus on implementation and constantly evaluate the programme achievements.

According to news reports, the Finance Ministry stated that, with better GLC performance, stakeholders would benefit from improved services delivery, human capital development, better employment prospects and best practices in procurement and vendor development programmes.

Moreover,  GLCs could step up their corporate social responsibility initiatives and make significant contribution in education, environmental protection and community welfare.

To date, 33 GLCs are listed on Bursa Malaysia, accounting for only 4.0 per cent of the total listed companies, have a market capitalisation of RM235.5 bill, or 49 per cent of total capitalisation, and employ more than 300,000 people. They contribute about 17 per cent of the nation’s gross fixed capital formation and account for almost 10 per cent of Gross Domestic Product.◊