Speech by Retired Temasek Chairman, Mr S Dhanabalan, at the Temasek 39th Anniversary Dinner

Ritz-Carlton Hotel, Singapore

Prime Minister, Deputy Prime Minister, friends and colleagues,

I'm simply overwhelmed!  I was told that this was going to be a surprise.  I knew there was going to be some sort of a party, some speeches, but I never expected this!

I want to thank you very much for your very kind and generous comments made about me. 
As you were saying some of the things, I was looking left and right to see who you were talking about.

And it reminded me of something that happened in my family. I'm not too sure whether I should tell this story; some of you may think it's not in very good taste.

But anyway, this is what happened.

My son and his wife, my daughter-in-law, went to a wake and there, they heard many good things about the person who had just passed away, and my son told his wife, "Why don't they say these things when he's alive?"

So the next birthday, she arranged a surprise party for him, and told a few of his close friends, and of course the family, that we were, each one, to say something about him that we had not told him before. And everybody came in black to that birthday party.

It was a surprise for him, and it was good to be able to tell him, at least for me, what I thought of him.  We were given 30 seconds to say, and the other friends too.

And it reminded me a little bit of that incident, when you all were talking, that maybe many of these things, I have the privilege of hearing while I'm still alive.

Seventeen years is a long time.  In my working career, the second longest time that I served was when I was part of the political leadership team of the Government. That was 15 years, so this is a little longer.

This 17 years that I've spent in Temasek is a deeply satisfying one.  And I'm very conscious that, to cap all the experience, expertise and hard work that the management brought to investment decisions, we had just that measure of good luck, to make so many of our investments turn out well.

I'm of course very, very grateful to have been given the opportunity to be part of this process which, as you've been told, has resulted in the value of the portfolio multiplying three times.  But let me hasten to tell you, that's not my work, and I will tell you why.

I'm also very grateful to have been given the opportunity to participate in a process of putting in place a governance model which is unique in the community of State-owned enterprises.

When Temasek was set up in 1974, my understanding is that the objective was to take out those enterprises, which the Government had inherited from EDB, into a separate entity, so that the civil service could focus on policy-making without being involved in the kind of conflict of interest that would arise if the civil service was also responsible for the commercial outcomes of companies.

I tried to see what was the clear purpose of Temasek.  And I must say that although maybe I didn't look hard enough, but I'd not been able to find a clear articulation of a vision as to what Temasek was supposed to become, apart from being a caretaker of a portfolio of investments.

In fact, in the 1980s and the early part of the '90s, the general public was not very much concerned or exercised by what Temasek should be, but the question was whether Temasek should exist at all. Much of the business community was only interested in reducing the government ownership of businesses through Temasek.  Divestment was the slogan of the day.

Though this approach was based, in part, on a mix of ignorance and prejudice, it nevertheless had some benefits for Temasek.  Temasek divested many of its smaller investments and the result was a leaner portfolio. But I do not think that even at that time, there was any clear idea what Temasek's aim should be.

When I was appointed Chairman in 1996, I came to an organisation which was well-managed, with people of very high integrity who were in charge. The primary focus was on preserving the value of the portfolio.

The Asian financial crisis, the collapse of the dotcom bubble, underlined the soundness of this approach of putting priority on value preservation.

Temasek did make some forays into investment in foreign enterprises, but unfortunately, the first couple of such investments didn't turn out well, and that did not give the management the interest to pursue this further.

We did make some small investments when there was a downturn in the market in 1990s and 2000, but we really did not do it in a concerted way.

Did I have a clear map, when I was appointed Chairman of Temasek? I definitely did not. I had no clear idea as to what Temasek should be, except that I had a vague idea that with all the wealth of experience in running businesses in what was then called GLCs – government linked companies – something more could be done with Temasek than being a mere caretaker.

By the early 2000s, GLCs had grown beyond the initial list of companies inherited from the EDB, and it included businesses of statutory boards, which were corporatized, like Singapore Telecoms, Port of Singapore, the energy part of PUB and other government-owned enterprises like SIA and the companies that were spawned by the defence needs of the State.

What I needed was someone who also had the idea that something more could be made of Temasek. In my mind, it was a matter of getting the right person.

At about this time, I had come to know Ho Ching, who was head of the ST Group. I did not know her very well, but I have some idea of her thinking on the subject of building up Singapore institutions and her thoughts on state investments from her working papers and email exchanges with me. Of course, I knew her record in the ST Group.

I then started the process of bringing her on board Temasek. I had to clear some hurdles before I succeeded, and I've spoken about this elsewhere.

Ho Ching and a few colleagues from ST put together a very good team of women and men; both local and international. In the last 10 years, this team has turned over almost completely, because many members of the initial team have gone on to head companies in the Temasek Group. She has attracted new people and now has a team as outstanding as the initial team.

Appointing Ho Ching in Temasek is the most important and significant decision that I've taken and which gives me the most satisfaction.

I've mentioned to Ho Ching that I know in my heart, and I've got to be true to myself, and I've got to be true to God, how little I deserve all the many, many good things that have been said this evening.

This is not just a conventional statement that I want to make because it's expected of me. I truly mean it from my heart, that I don't deserve a fraction of what was said!

It was a great privilege for me to have been a member of the Board of Directors of Temasek, guiding the management team, led by Ho Ching.

Another development that gives me satisfaction is something that the Deputy Prime Minister mentioned, which is the model of corporate governance that we have in place now.

The model of allowing the board and management of a business owned by the Government to get on with managing the business without interference in the day-to-day business of the corporation, and to judge the performance of the enterprise over the long term, has been a feature of this Government since 1959.  It’s not new.

That is why the Minister for Finance holds all government ownership in businesses, and they're not held by the different ministers who are responsible for the regulation of the business activity or a company.

It explains the success of such bodies like the EDB and DBS under the late Mr Hon Sui Sen, and the PSA and DBS under the late Mr Howe Yoon Chong. I mention them because I had a wonderful opportunity of working under them, and of learning from them the preparedness to act without detailed direction, and the courage to exercise entrepreneurship.

A lot of what I did in Temasek, in my relationship with the management, I learned from them. And even today, it astounds me that Mr Hon, in 1960, leading a team of very young people, in their mid 20s, to entrust us to do what has made Singapore what it is today.

We had older people, the foreigners, but there's no doubt who was in charge. We were in charge. Whether we were capable was not the point; we had to make ourselves capable and make the right decisions.

While the companies in which Temasek owned shares were left to conduct their businesses, free from government interference, the Government still exercised the prerogative of appointing the head of the board, even the directors, and the head of the management. This only changed over the last 12 years or so.

The boards of Temasek and the Temasek companies now have full responsibility for the appointment and renewal of both board and management personnel. Just like any other company in the private sector, when you make changes to the board or to the CEO's position, of course you will consult major shareholders. You don't want to be surprised at the AGM! So to consult shareholders is nothing new, but the initiative to identify people, to invite them, to appoint them, lies with the board and the management.

And entrusting the board and management to conduct business and to plan and execute succession without political interference makes us unique in the community of State-owned enterprises. I know this, both from what I read, as well as from my discussion with leaders of State-owned enterprises from other countries, both in the developed and developing world.

This latest development of corporate governance would not have been possible without the encouragement and assent of the prime ministers and the finance ministers since 1996. I want to thank them, and I want to especially thank Prime Minister Lee Hsien Loong and Deputy Prime Minister and Finance Minister, Tharman Shanmugaratnam, who are with us this evening, for placing their confidence in the Board of Temasek.

I'm so glad that Lim Boon Heng is taking over from me. We come from different backgrounds, but I can sense, from the time that I first spoke to him, that we share a very common set of values.

Ultimately the fortunes and the performance and the character of an institution is determined not by the technical competence and the business experience of the people leading it, but by the value systems that they hold dear.  Boon Heng and I share the same value system.

Boon Heng, I want to tell you don't get put off by thinking that I produced these results. It's the management that did. They're still there and they will still look to you for guidance and you can still continue to guide them and lead them to perform as well as they've done in the last 17 years.

I do not see my retirement as Chairman of Temasek as a retirement from an active life.  At least, I'm sure my wife doesn't want me to sit at home and get on her nerves!

As long as the good Lord gives me mental and physical capacity, I hope to continue to be engaged in doing what I can to make our society and community better.

Most of what I hope to do would be at a very individual, local, small level like helping a person up a step or to cross a small hurdle. I will find that significant.

As I exit, I have two thoughts.

First is what Jesus said, as recorded in the Gospel according to Luke and I quote, "When you have done everything you were told to do, you should say 'We are unworthy servants, we have only done what we should do.'"

I have that always on my mind.

Second, I can think of no better way to express my thoughts about my future than the last three lines of a Robert Frost poem, 'Stopping by the Woods on a Snowy Evening', and some of you know this because I've quoted this to you:

"I have promises to keep,
And miles to go before I sleep,
And miles to go before I sleep."

Thank you very much.

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