Part 1: Why did Datuk Azhar replace Tan Sri Sulaiman as FGV chairman and what is Datuk Azhar’s track record?

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WHY DID DATUK AZHAR REPLACE TAN SRI SULAIMAN AS FGV CHAIRMAN AND WHAT IS DATUK AZHAR’s TRACK RECORD?

 

Tan Sri Dato’ Seri Dr. Sulaiman Mahbob, the former Chairman of Felda Global Ventures Bhd. (FGV), is an accomplished, capable and honest man.

 

He has served the government for over 38 years, including as Director-General of the Economic Planning Unit, Secretary-General of Ministry of Domestic Trade and Consumer Affairs and acted as director or Chairman of Malaysian Investment Development Authority (MIDA), Petronas, Federal Land Development Authority (FELDA), Malaysia Insurance Deposit Corporation (PIDM) and Multimedia and Communications Commission.

 

Most importantly, for a company in such dire need of repair as FGV, Tan Sri Sulaiman is also an honest man, having served as the first founding President of the Institute of Integrity Malaysia (IIM), where he established programmes to promote a culture of ethics and integrity in the government and private sector, in line with the Government’s National Integrity Plan.

 

So why was a capable, honest, experienced and loyal government servant relieved of his all-important duty of trying to turn FGV around?

 

Especially as he has considerable turnaround experience such as the key role he played in guiding the country out of the Asian Financial Crisis in 1997-98, when he was the Head of Secretariat at the National Economic Action Council (NEAC)?

 

Granted, Tan Sri Sulaiman was merely acting Chairman but the board could have requested for more time and formalised a new contract so the necessary consistency and stability might have helped right the ship.

 

Instead, no such thing has happened, and another new entrant has come into the picture: former MRT Corp CEO Datuk Wira Azhar Abdul Hamid. It will be a trying time for FGV’s long-suffering farmers and shareholders. They will now have to wait and see whether the new candidate has the necessary commitment, ability and integrity to turnaround a company as under-pressure as FGV.

 

A JOB HOPPER

 

Since qualifying as a Fellow Member of the Association of Chartered Certified Accountants (UK) and the Malaysian Institute of Accountants in 1988-99, Datuk Azhar appears to have not sat in a role much beyond three years. Not as an Internal Audit Manager at British Telecom Plc (UK, 1989-1991). Not as Head of Internal Audit and Head of Finance, Malaysian Cooperative Insurance Society Ltd (1992-1994).

 

And likely not at Sime Darby Group, where despite a seven-year stint (1994-2001), he was involved in three roles, a rough average of just two years in each position (Financial Controller, Sime Tyres International Sdn Bhd; Business Development Director, Sime Conoco Sdn Bhd and Group General Manager, Engineering, Oil & Gas Division)

 

The same occurs at his next role as Group CEO, Pernas International Holdings Bhd (2001-2002), before returning to Sime once again for another seven-year stint, but this time in even more jobs (seven in total spanning Food, Plantations, Tractors Malaysia and Heavy Equipment).

 

His longest stint (2007-2010 ) was as Chairman of the Malaysian Palm Oil Association but that ended once he became CEO of Mass Rapid Transit Corporation Sdn Bhd (2011-2014), his most prominent role until now.

 

That was a three-year stint until he once again left, this time to join Tan Sri Syed Mokhtar Al-Bukhary’s Group of Companies, first as President/Group Managing Director of Tradewinds Corp Bhd (2015-2016), then as its Chairman (2016-2017) before moving on to Group Managing Director of Malakoff Corp. Bhd (2016-2017) before his current job as FGV Chairman.

 

While Datuk Azhar has accumulated many years of experience in agribusiness and plantations, will he stick around long enough to turn around an ailing FGV?

 

Or will he leave again before his job is finished?

 

MYSTERIOUS CIRCUMSTANCES, POOR PERFORMANCE

 

On May 25, 2017, The Edge reported, citing a source, that Datuk Azhar had left Tradewinds “quite suddenly” and could not be contacted for a comment by the reporter. While Tradewinds was not a public company, its sister company Malakoff, where his last post was, is.

 

On 30 June 2017, Malakoff announced that Datuk Azhar had resigned “due to personal and professional reasons”, barely thirteen months after his appointment, and no further explanation was given to shareholders for his departure. One possible reason was the poor financial performance at Malakoff during his tenure.

 

When Datuk Azhar took over the reins in May 2016, Malakoff’s share price was around RM1.64. When he left, the price had fallen to RM1.06, a 35% drop in slightly over a year. Perhaps, the share price was mirroring the financial performance of the company.

 

In the quarter ending June 2017, the month of his departure, earnings per share had dropped to 2.07 sen a share, down from 2.59 sen a year earlier, when he had taken on the role. Dividends had also fallen to 2.50 from 3.50 the year before. In fact, For the first six months of 2017, accumulated earnings per share had fallen to 4.04 sen a share from 4.27 sen the year before.

 

Was the poor performance the reason behind his departure? And if so, does this make Datuk Azhar the right man to chair FGV?

 

In the second of this three-part series, an examination of how Datuk Azhar performed at MRT Corp and how well he stacks up against his global rivals.

 

Submitted by: TruthPrevails

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