Appointments of board members of government-linked companies (GLC), including politicians, are made based on the candidate’s qualification, expertise and experience, Finance Minister Tengku Zafrul Tengku Abdul Aziz told Dewan Rakyat today.
The senator said such appointments are made in line with the Malaysian Code of Corporate Governance 2017.
“Besides that, political appointments will have to undergo several rounds of vetting including by Bursa Malaysia, the Securities Commission, Bank Negara Malaysia, Malaysian Anti-Corruption Commission, Royal Malaysian Police and others,” he said.
“I would like to emphasise that the government is committed towards upholding the practice of good governance,” he added.
Zafrul was responding to a question by Lim Guan Eng (Bagan-PH) on the measures taken to improve Malaysia’s sovereign credit rating, which was recently downgraded by Fitch Ratings.
Lim also said while Budget 2021 aimed to maintain Malaysia’s credit rating through fiscal consolidation, it failed to address issues such as political instability, poor governance and transparency, including replacement of GLC board members with political appointments. This has contributed to the downgrade of Malaysia’s credit rating.
On December 4, Fitch Ratings downgraded Malaysia’s long-term foreign-currency issuer default rating (IDR) to “BBB+” from “A-” on the back of lingering political uncertainty and substantial impact of Covid-19 on the economy.
Responding to the move by Fitch, Tengku Zafrul said international credit ratings have imposed more than 220 negative ratings since early March, including downgrading sovereign rating for more than 100 countries, including the UK, Hong Kong, Chile and Laos.
Although this is in line with global standards, Putrajaya is of the view that the ratings agency did not take into account the effectiveness of the economic stimulus packages, he said.