The Ho Ching factor

IS MS Ho a reason for what seems to be greater-than-usual public interest in Temasek?

The 'Ho Ching factor' cannot be ignored, says Mr Tan, adding: 'If anything, it heightens interest in Temasek, especially when there is not-so-good news.'

Her position at Temasek drew public attention from the start.

When she was appointed its chief in 2002, people questioned if there was a conflict of interest as her husband, then Deputy Prime Minister Lee, was also the Finance Minister whom she would report to.

That issue was overcome by getting the Temasek board, instead of Ms Ho, to report to the Finance Ministry. The board was, and continues to be, headed by Mr S. Dhanabalan.

But the public continued to be curious about how she managed Temasek, which celebrates its 35th anniversary this year.

Temasek was set up in 1974 with a $350 million injection of assets from the Government when it decided that it would be better to have them managed by an independent body.

Those assets were mainly shares in state-owned companies. Their value has swelled to $127 billion as of Nov 30 last year.

While the public does not probe when Temasek makes money, they do press for greater transparency when losses are suffered - such as the $58 billion loss in asset value between March and November last year following the global financial crisis.

Many will zoom in on Ms Ho's performance, which is an unfortunate burden she has to bear as PM Lee's wife, says former Nominated MP and businessman Zulkifli Baharudin.

'This is due to high expectations placed on her. When Temasek loses money, people will say, 'How can PM's wife lose money?',' he notes, even though other investment agencies and SWFs also suffered losses in this global recession.

'I dare say that if Temasek has a different CEO who is not the PM's wife, people won't jump so much.'

Likewise, Mr Goodyear's exit has turned the spotlight back on Ms Ho, with people, once again, pressing for answers.

Whetting people's appetite

BUT it is not all about Ms Ho. The calls for greater transparency can also be traced to Temasek revealing more in recent years, say observers.

Since 2004, Temasek has published an annual report even though it is not under any obligation to do so.

'When you go down that path, you will have to accept that people will want to know more; it will never be enough,' says CIMB-GK regional economist Song Seng Wun.

The calls will only get louder.

What Temasek and the Government have to do, say observers, is to give more, not less, information as sparse replies lead to unnecessary speculation.

Such speculation will only hurt Temasek's reputation as a global investment player, notes SMU associate professor for finance Melvyn Teo.

'What is best strategically for Temasek...may well be greater disclosure.'

By revealing more financial information, it will also help educate Singaporeans that returns can be negative as well as going up and down in the positive range, says Mr Truman.

'An established track record of accountability and disclosure protects managers from unjustified criticism,' he notes. 'As for the...argument that hedge funds and private equity firms do not practise such accountability and transparency, the pendulum is swinging in that direction.'

Temasek and the Government, adds Mr Song, can no longer take the approach that 'we know best, so just trust us'.

'Singaporeans have grown up. Now, it's time to trust them and be more open with what is being done with the money,' he says. 'It will also give Singaporeans one less thing to gripe about.'

Is the last a certainty though? The opposite could well happen: If Temasek discloses more, there may be more for Singaporeans to gripe about.

The only certainty is that there is no guarantee either way that the gripes will stop. The tussle between openness and opacity will continue.

This article was first published in The Straits Times.