Temasek and GIC ranked lower than Timor Leste’s Petroleum fund

Temasek and GIC ranked lower than Timor Leste’s Petroleum fund on International Scoreboard for SWFs by Peterson Institute!

According to the Peterson Institute of International Economics, both Temasek and GIC are ranked lower than Timor Leste’s Petroleum Fund on the scoreboard for SWFs.

Timor Leste scored 21.75 points in the 2007 ranking while Temasek and GIC scored 13.50 and 2.25 respectively.

The scores are computed based on four categories: structure, governance, accountability and transparency and lastly, behavior.

Temasek and GIC performed especially badly under the “structure” category. GIC does not state the source of its funds which is not kept separate from Singapore’s international reserves.

Though Temasek has been publishing an annual report since 2005, there is little information about its activities. While Temasek subjects itself to an internal audit, the results are not released to the public. As for GIC, nobody knows if it does conduct any internal audit at all.

It is time that both SWFs subject themselves to a rigorous and thorough audit by an independent auditor given their dismal performance last year.

Instead of recruiting more caucasians to sit on its board of directors, they may consider a cheaper alternative: Timor Leste.

Since the Singapore government has always been obsessed with international rankings, it is surprising they appeared to be nonchalant about the miserable rankings of Temasek and GIC near the bottom of the list.

As the recent Ren Ci trial has shown, any organization, be it a company, a charity or SWF which lacks a system of checks and balance will expose itself to possible abuses by a rogue CEO.

Ren Ci’s ex CEO Ming Yi was allowed to assume both positions of CEO and Chairman at the same time. Ren Ci’s accounts were not audited by an external auditor and neither does its CEO need to answer to anybody other than himself.

Without the NKF saga which forced the Ministry of Health to conduct stringent checks on charities, the scandal in Ren Ci will never be uncovered.

There is no reason why Temasek and GIC cannot open their account books and allow themselves to be audited if they are indeed managed accordingly to accepted international standards.

You can read the entire report here:
http://www.iie.com/publications/papers/truman1007swf.pdf

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