On 22 October, through a supplementary question in Parliament, Pasir Gudang MP Hassan Abdul Karim proposed that only professionals should be appointed to government-linked company positions, excluding those with political backgrounds.
In response, Prime Minister Anwar Ibrahim reaffirmed the government’s stance that politicians can be appointed to such positions through a merit-based process.
The Center to Combat Corruption and Cronyism (C4 Center) strongly disagrees with this position and calls for an end to the appointment of politicians to government-linked companies and government-linked investment companies.
The prime minister’s justification is that all appointments to key positions in government-linked companies undergo a stringent vetting process, adding that the checks involve the Inland Revenue Board, Bank Negara Malaysia, the Malaysian Anti-Corruption Commission (MACC) and police.
However, such checks do not address the main issue of political appointments; namely, political influence and patronage.
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Political appointments to government-linked companies have long been criticised as a way to reward political allegiance and maintain loyalty.
Even if vetting processes ensure that a political appointee is qualified for the position, the question of political influence remains.
If, as Anwar says, there is no discrimination between a politician and a non-politician, why does the government appear so determined to defend the positions of politicians in government-linked companies?
Through a merit-based system, is it really that difficult to find another equally qualified individual for the position?
According to Anwar, political appointments are not made to financial institutions and other agencies related to finance. If the above vetting process is sufficient, why are politicians not allowed to be appointed to these institutions?
This contradiction alone clearly admits the inherent risk of abuse of power when appointing politicians to significant corporate positions.
The recent appointment of Nooryana Najwa Najib to the board of directors of the Malaysia External Trade Development Corporation (Matrade) further calls into question the legitimacy of the supposed vetting process.
Nooryana is politically connected not only as the daughter of convicted former Prime Minister Najib Razak but also through her position as an executive committee member of Umno’s women’s youth wing, Puteri Umno.
As the national trade promotion agency under the Ministry of Investment, Trade and Industry (Miti), her position in Matrade bears extremely significant responsibilities.
Without making judgement calls on Nooryana’s character and skills, would she have been able to secure this appointment were it not for her familial relations to a former prime minister?
If not directly correlated, how relevant were her party connections that allowed her to be considered for this role? Would any other 36-year-old with Nooryana’s qualifications, experience and skillset – but without her political connections – have been able to secure this appointment?
These questions already cast doubt on this supposedly infallible merit-based appointment system that claims to transcend the influence of political connections.
It is crucial to note that Nooryana was sued for RM10.3m in unpaid taxes by the Inland Revenue in 2020. The suit was ultimately withdrawn by the board in 2022.
Anwar also made mention of a test of character and that individuals selected would have “clean records”. Would Nooryana’s history of being served a lawsuit by the Inland Revenue affect a test of scrutiny?
Does the substance of the initial lawsuit against her still hold weight in whether she is considered for the role of director? Does it matter that the suit was withdrawn by the Inland Revenue itself?
Nooryana is far from the only appointee where unravelling these questions will prove to be a task many will consider best left untouched.
Even if questions of political patronage are set aside, the primary role of an elected representative is to make laws.
Thus, an inherent conflict arises when an individual elected to represent the interests of a constituency – or more broadly, the interests of Malaysians – is also tasked with representing the interests of a major corporation.
With the financial and material incentives clearly favouring the furthering of private interests, there is a great deal of risk involved in assuming that all political appointees, who simultaneously maintain their roles as elected representatives, will always be able to still make decisions that put their constituents first.
Moreover, it is crucial to note that even the perception of a conflict of interest is detrimental to good governance.
This is relevant in instances where political appointees are not actively holding public office but have clear political ties and allegiances that cannot reasonably be separated from their role as leaders in government-linked companies.
Standards of accountability to the public for government-linked companies are necessarily higher as they are a direct recipient of public funds and are themselves business enterprises set up to bring benefit to the public.
Thus, it is reasonable and necessary to question the decision-making of an appointee who has acted in the interests of a political party or coalition throughout his or her entire career.
Above all, the practice of political appointments – and the government’s defence of this – creates the expectation of being granted appointments for every individual who enters into politics.
Hence, even prior to their appointments, individuals will be incentivised to make political decisions in the hope that they are seen as suitable candidates for positions in government-linked companies and their lucrative benefits.
This practice ultimately undermines our entire democratic process from within.
Government’s stance
Worryingly, the government appears intent on continuing the practice of political appointments.
Shortly after his election victory in 2022, Anwar terminated all politically appointed chairmen and board members of government-linked companies, statutory bodies and state-invested funds with immediate effect.
Many heralded the move as a bold new step toward eradicating political patronage in Malaysia.
This perception was short-lived. A few days after the announcement, Anwar clarified he was not totally opposed to the idea of political appointments, and that the terminations were effected to enable performance evaluations and ensure appointments were made in accordance with government guidelines.
However, of the 442 government departments, agencies, and government-linked companies listed in the Ministers of the Federal Government Order 2023, at least 61 boardroom positions were taken up by politicians from Anwar’s ruling coalition – 19 MPs and 42 other politicians.
The national anti-corruption plan for 2019-2023 had stated clear strategies to regulate the practice of political appointments.
Much to the dismay of civil society, this target was completely absent from the recently launched national anti-corruption strategy for 2024-2028.
The current number of political appointments is alarming, and the statements made by Anwar only portend an increase in appointments, with its harms disguised beneath a coat of ‘meritocracy’.
Recognising that the risks associated with political appointments far outweigh any positive effects they could bring, C4 Center calls for the immediate cessation and termination of all political appointments under the “Madani” (civil and compassionate) administration.
It is time we break free from this endless pattern of abuse within the system of government-linked companies and chart a path towards cleaner and more equitable politics. – C4 Center
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