AN INDEPENDENT professional inquiry should be commissioned to look into the circumstances that led to the dismissal of three Singapore Post (SingPost) senior executives.
This is in light of the seriousness of the incident, as well as “the large number of questions still circulating”, said David Gerald, founder, president and chief executive of the Securities Investors Association (Singapore), or Sias, in a statement on Thursday (Jan 2).
Gerald noted that the sudden dismissal of these executives and their “vigorous denial” of the allegations against them have raised “critical questions in the minds of shareholders, investors and the market”. He added: “The fact that they were told to leave with immediate effect points to an extremely serious breach of the rules, which in turn necessitates detailed explanations.”
Gerald also said that the company’s disclosures and the three executives’ responses thus far have raised more queries than provided answers.
The employment of group CEO Vincent Phang, group chief financial officer Vincent Yik, and chief executive of SingPost’s international business unit Li Yu was terminated on Dec 21, 2024, after they were found to have been negligent in the handling of internal investigations over a whistle-blower’s report and in subsequent probes.
Gerald said: “Shareholders deserve better, and so does the market, if all are to make informed decisions regarding their investments.”
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In response to Sias’ call for an independent inquiry into the sackings, Phang and Yik told The Business Times that they welcome any independent inquiry, “including any from other regulatory bodies or authorities, and would participate fully”.
Gerald questioned if SingPost’s board was “the appropriate body” to lead the investigations, considering the apparent severity of the claims.
He also asked whether the company’s group internal audit department had the necessary skills and expertise to objectively conduct the probe, and also the number of staff in this department. In addition, he highlighted discrepancies between what SingPost said about the three executives, and what the executives said.
In a response to shareholders on Dec 29, the company said that the executives were provided with the reports and concerns raised by the internal auditors, but they made misrepresentations on three occasions from Mar 11 to Apr 3.
Both Phang and Yik said in a statement on Dec 31 that they were interviewed only on Mar 11 and Apr 3, and responded accordingly, based on the facts that were provided to them at the time.
They also highlighted that it was only on Apr 27, when the external forensics team’s investigations came to light, that they had full knowledge of the incident.
“We have here a fundamental difference in positions taken by the two opposing parties. Note that the only way to properly resolve this is via an independent investigation,” said Gerald.
He added: “From the viewpoint of shareholders and the market, Phang, Yik and (Yu) are presumably experienced and intelligent company officers. For them to collectively misrepresent practices on the ground implies they were acting in unison.
“Was there collusion? If so, what was their motivation?”
He queried if “alternative disciplinary measures”, such as suspensions, pay cuts or demotions had been considered.
“Retail investors, who form a significant portion of SingPost’s shareholder base, deserve assurance that corporate governance processes are fair and transparent.”
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David Gerald, founder, president and chief executive of Sias
He also asked if the board had considered the issue of succession when it terminated the three executives, given that such an abrupt action would leave a large leadership vacuum – just when SingPost was undertaking a significant asset sale in Australia and a strategic reset.
“What assurance do shareholders have that the sale is actually still on, and (that) a strategic reset will still be possible, and indeed successful, given the loss of three key management personnel?”
Gerald pointed out that potential litigation between SingPost and the sacked executives may result in substantial legal costs, further eroding shareholder value.
He cautioned that the proceedings could damage the company’s reputation, potentially undermine investor confidence and the value of shareholders’ investments, and asked whether the board was prepared for this.
“Retail investors, who form a significant portion of SingPost’s shareholder base, deserve assurance that corporate governance processes are fair and transparent. Only through a wholly independent inquiry can transparency, accountability and trust in SingPost’s governance be fully restored.”
