Temasek Holdings – “not required” to disclose?

Leong Sze Hian

I refer to Temasek Holding’s letter “Protection of Temasek’s past reserves” (Today, May 20).

It states that “Although not required to do so, Temasek publishes an annual Temasek Review, providing a summary of key financials as well as the relevant investment performance over different time periods from one year to over three decades”.

Not required to disclose?

I am rather perturbed by this statement, because Temasek is managing our country’s assets – so, why should it not be required to disclose what it is voluntarily giving in its annual Temasek Review?

Since it is a voluntary disclosure, may I ask to what governance, transparency and reporting standards is it adhering to?

Allow me to illustrate the point with a story.  A large family gives their money to a person to look after and manage for them.

This person then tells the family members that although he is not required to do so, he is voluntarily giving them information.

Does this make sense to you?

As a matter of good corporate governance, listed companies make disclosures on the remuneration of its board and corporate officers.

I don’t seem to be able to find the remuneration information break-down in the annual Temasek Review.  How much of its $8.7 billion Administrative Expenses for the last financial year was for remuneration related expenses?

Do other countries’ Sovereign Wealth Funds (SWF) give this information?

As to its 17 per cent per annum Total Shareholder Return (TSR) by market value, what is the return after adjusting for periodic cash injections from the Government and valuation gains from state assets transferred to Temasek?

For example, in the recent Parliamentary debate announcing the transfer of Changi Airport by corporatisation to Temasek, I do not recall any mention of the valuation of Changi Airport?

With regards to the statement: “Temasek does not manage or invest any CPF money.  Nor does it manage the foreign reserves of Singapore”, the fact is that Temasek manages a large portion of Singapore’s assets.

Over the last 34 years or so, CPF moneys may arguably have been used by the Government to manage through the Government Investment Corporation (GIC), helped to develop state entities and assets, etc.

Thus, although Temasek does not manage CPF moneys, in a sense, it may have indirectly benefited by way of cash injections from the Government, asset transfers, etc.

Whilst repeated questioning in Parliament by Members of Parliament (MPs) failed to find out how much Temasek lost during the last financial crisis, its report now indicates a negative Annual Wealth Added of $68.1 billion in 2009.

In this connection, its Portfolio market Value for the financial year ended 2008 was $185 billion.

If this is the foreplay of “transformation”, I think we may yet have a long way to go, to attain the highest standards of disclosure, transparency and accountability that Singaporeans may now expect from a Government that keeps saying that it wants to ‘transform’ itself.