KUALA LUMPUR • The days of top executives at Malaysia's government-linked companies (GLCs) drawing fat salaries regardless of their companies' performance are over, Prime Minister Mahathir Mohamad has warned.
The Premier said that in the past, the government found it convenient to place its supporters in GLCs, where these executives got a good income.
"The result is that we have a lot of people who are non-professionals and unfamiliar with business, but holding high posts in the GLCs, and this of course defeats the whole purpose," he said in an interview with Investine, a Hong Kong-based business news portal.
"The GLCs inevitably lose money, but the salaries of these people are very high and they enjoy all this without bothering whether the company makes a profit or not," Tun Dr Mahathir added.
He said his Pakatan Harapan government - which came into power in May - wants to place professionals in these GLCs at lower salaries.
"The salaries may be slightly higher than those of the civil service, but if they perform, then we'll pay them a bonus. Otherwise, they won't receive the high income as currently, and we will change the management so that we appoint professionals," he warned.
Dr Mahathir said it did not matter whether "they are party people or not", but it is key that they must be professionals who fit the business of the company.
In the interview, Dr Mahathir also spoke about Khazanah Nasional Bhd, the government's strategic investment fund which he set up in the 1990s during his first tenure as prime minister.
He said the idea for Khazanah was prompted by the apparent inability of Malays - the country's dominant ethnic group - to retain shares they acquired under the government's affirmative action policy. "When they get their shares, they inevitably sell them all and then they go back to having no shares... So, we thought that instead of giving directly to the Bumiputeras, we'll create a body that can hold the shares until such time when they have the capacity to retain those shares," he said.
"That was the original intention, but along the way, Khazanah decided that it should take all the shares for itself," Dr Mahathir explained. "And so they forgot entirely about holding the shares for the Bumiputeras."
Moving forward, the government will vet the companies that Khazanah has shares in and categorise them by profitability.
"We need to talk about closing some of these companies... and to a certain extent go back to the original intention of holding the shares allocated to the Bumiputeras until such time when they can buy," said Dr Mahathir.