Khazanah defends hefty pay hikes for top GLC officers

Posted by SM Maulana

KUALA LUMPUR, June 17 — Khazanah Nasional Bhd, the government investment arm, today came out in defence of the proposed salary hike for top officers in government-linked companies (GLCs), citing enhanced value creation, careful calculation and retention

of talents.Its managing director Tan Sri Azman Mokhtar said Khazanah’s Blue Book, which details executive compensation, tries to institutionalise that “we cannot pay too low, we shouldn’t pay too high, but we have to pay enough and we have to pay fairly”.He said when asked to comment on queries in several blogs on why Tenaga Nasional Bhd’s top officers were getting hefty salary increases in a time of a possible economic slowdown due to the fuel and food price hike.Azman said after much debate four to five years ago, Khazanah decided on the average principle for basic salary.But at the same time, it also put up a total compensation basis for the salary, including bonus, as long as it was self-funding, he said.”The average Malaysian company pays three months’ bonus. What we are saying is that we will pay more, as long as the company and shareholders make much more than that. That means value must be created,” he told reporters after attending the opening ceremony of the MIT Sloan Global Entrepreneurship Lab Programme workshop facilitated by Khazanah.”That is a very important point. It is performance-based, incentive-driven and self-funding. We are not taking money away from anybody but we are creating more value,” he added.According to Azman, the higher pay commensurated with the increasing demand for local talents abroad.”Malaysian talents are in demand from the Middle East, China, Asean and also the United States. There is a very serious brain drain issue that we should be aware of. So don’t begrudge our CEOs and the managements,” he said.”If you see them making money, you should celebrate because they have created a lot of value for the companies. Let me assure you that there has been careful calculation on this,” he added. — Bernama


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