Friday, December 24, 2010

Is Sime Scrapping Bottom Of The Barrel?

Hantu Laut

I am not sure whether we should laud the action taken by Sime Darby against its executives and some of its former executives for its unprecedented whopping losses incurred the last year.

Is Sime looking for scapegoats? If it is than it may have looked in the wrong place.

What is the likelihood of recovering the money as the claim put forth is a pittance compared to the total loss and absurdly on the basis of accusation of mismanagement and incompetence and not misappropriation or corruption.

There is a clear distinction between the two.Mismanagement and incompetence are not criminal acts, misappropriation and corruption are.Sure, you can sue them for negligence which will be so tedious to prove.Was this action taken due to political pressure to appease the opposition?

The company also alleged that the five accused acted as a "decision-making unit" in the energy and utilities division and were responsible for the division's actions and omissions.

The question is what happened to Sime's Board of Directors, had they become redundant so much so that huge investments of capital nature are made by its executives and who select and approve the appointment of this bunch of incompetents?

Have the board not been negligent of its fiduciary duties to the shareholders. They are the trustees and the link between the shareholders and the executives.A company failure should be attributed more to the CEO and members of the board rather than its employees, putting asides wrongdoings of which the board should also take full responsibility.

A responsible board would have regular meetings to keep checks and balances.If such meetings are conducted regularly and board members are alert and responsible most problems could have been detected much earlier before they get out of hand.Obviously, the board is very much asleep leaving everything to the executives.

Why is it that every time a case like this came up the plaintiff or in the case of big corruption case the prosecutor always walk on weak ground?

Sime sued the five for breach of duties and asked for restitution of MR177 million.Why, only that amount when the total loss was MR2.1 million?Who is responsible for the bigger balance of losses?

The question again do the five have that kind of money considering how much Sime pay them every year?

Are there more cases in the pipeline or this will suffice to appease the public that the government is taking action.

We all know most GLCs are run by incompetents and they survived only when they have monopoly of the business, the moment the monopoly is removed and they have to compete on level playing know what follows.

Read the full story here.


eddy said...

Ya Bro so why does Sime Darby pay a lot of money to the Chairman and the BOD if they have no decision making or oversight powers at all.

It cannot be they attend monthly Board Meeting and talk cock all day while listening to the MD/CEO report to them. Does not make sense.

Does not make even more sense to sue the former Management of Sime Darby also. They cannot pay with the pittance locals are paid to helm a big conglomerate that is for sure. In their defence a lot would come out, some how I think the shit will hit the fan and the BOD will somehow get shit all over them.

Anonymous said...

If Selangor is a communist state then the Malaysian Govt. is a communist govt.

Do you know that pictures of Menteri Besar and Chief Minister of Pakatan States are not allowed to be hang in schools. Yet no one says anything about that.

Is the Federal Govt. willing to allow Pakatan Rakyat put up billiboards depicting the success of PR programmes in BN ruled state?