By Sue-Ann Chia, Senior Political Correspondent

MR CHARLES 'Chip' Goodyear has bid farewell to Temasek Holdings but some Singaporeans still will not let the matter rest.

They demand to know why the American chief executive-designate of Singapore's investment agency left his post prematurely.

The official reason Temasek cited in July was 'unresolved strategic differences'.

It was a phrase that led to much speculation on what could have caused Mr Goodyear to call it quits about five months after it was announced that he would take over from Ms Ho Ching in October.

Answers proved just as elusive when some MPs raised the issue at the last Parliament sitting two weeks ago.

Responding, Finance Minister Tharman Shanmugaratnam said: 'People do want to know. There's curiosity. It is a matter of public interest. But that is not sufficient reason to disclose information...It will not be advisable, nor in the interest of Temasek or Mr Goodyear, for us to have to comment further on it.'

Maintaining his stand on non-disclosure, he reiterated more than once: 'It serves no strategic purpose.'

While carefully crafted, his reply, some say, has served to further fuel, not douse, the ongoing debate about Temasek's lack of transparency.

It also prompted some to question why answers sought from the Government were not forthcoming in Parliament.

But do people have the right to know more on this issue? Is the controversy over Mr Goodyear's departure a matter of public interest or mere public curiosity?

Who are the people wanting answers and what do they wish to know? And why is there such an inordinate amount of interest in the goings-on at Temasek?

Reveal more, not less

THE lack of answers in Parliament has caused a stir, especially on online forums, with netizens viewing it as the Government's lack of accountability to citizens.

It is uncertain how much of the unhappiness from cyberspace chatter has spilled into the real world of coffee shop and cocktail conversations.

But political observers and analysts interviewed by Insight believe the Government could have avoided any such backlash by being less opaque.

'The episode was a storm in a tea cup that could have been avoided by a better calibrated and articulated information flow,' says law academic Eugene Tan of the Singapore Management University (SMU). 'It is possible to provide more information without compromising the strategic purpose requirement.'

Mr Carl Linaburg, co-founder of the Sovereign Wealth Fund (SWF) Institute in the United States which ranks these funds, including Temasek, on transparency issues, agrees.

He says: 'The Singapore Government could have given a better response. The answer regarding Chip's departure seems to open a lot more questions than were necessary.'

It also resulted in the Wall Street Journal Asia newspaper publishing an editorial, saying the episode shows 'the government will disclose only what it deems acceptable regarding Temasek'.

It received a swift rebuttal from Singapore's Finance Ministry - the sole shareholder of Temasek.

Calling such assertions 'unfair', the crux of the ministry's comeback can be summed up thus: It discloses all relevant information - favourable or not - that Singaporeans need to judge Temasek's performance as a long-term investor.

It does not believe the Government or Parliament should become engaged in Temasek's investment strategies or internal governance.

'This would politicise Temasek's operations, and prevent it from managing its portfolio professionally and sustaining good, long-term performance,' it said.

Observers can see the wisdom in the argument as Temasek and other SWFs prefer to be seen as independent investors to prevent a nationalistic backlash when they buy stakes in foreign companies.

But not all are convinced it is the best approach in the instance of Mr Goodyear's exit.

MP Inderjit Singh from the ruling People's Action Party believes the Government owes it to the people to have given a 'better explanation' in Parliament for one reason - Temasek's assets form part of Singapore's reserves.

'The only public channel for us to know what is happening to our reserves is Parliament,' he says, noting that Temasek's annual report does not reveal everything.

SMU's Mr Tan argues that by not saying more, the Government unwittingly gives the impression that it is siding with Temasek rather than the people whose interests it serves.

The 'evasive responses and non- answers' could also damage Parliament's credibility, he adds. 'It only gets perceived as a lack of openness and that even Parliament was powerless in seeking more and better information.'

Public interest

WHILE many observers agree that the Government's reply was inadequate, the question remains: How much information should it reveal?

It boils down to what 'public interest' - a term used by Mr Tharman in his parliamentary reply - means when it comes to Temasek.

Should it be taken to mean that it is the Government's duty to disclose information unless such disclosures compromise national security?

Or is it just public curiosity - which can be ignored?

Most observers believe that viewing Mr Goodyear's exit as a matter of public interest in the first sense would be 'overstating' its importance.

Leadership changes are commonplace in corporations and Temasek - like any corporation - does not need to elaborate on management decisions, they argue.

There might also be a non-disclosure agreement between Mr Goodyear and Temasek, preventing the investment agency from revealing more.

'It is reasonable for Temasek...to rethink its strategy from time to time and if the new CEO cannot work within that strategy, then there should be a parting of the ways,' notes Mr Edwin Truman from the US-based think-tank, Peterson Institute for International Economics, which studies SWFs.

'I do not think it is necessary or even appropriate for the Government or Temasek to reveal what goes on inside the boardroom.'

Mr David Cohen, an economist at Action Economics, adds: 'Temasek should not be held to any higher standards than other corporate entities. It is managed on commercial considerations which it bases all its decisions on.'

Yet, Temasek is also a different corporate creature because it is involved in growing Singapore's reserves.

Any misstep has political implications, which is reason enough for some observers to believe Temasek and the Government need to open up more and satisfy people's genuine desire for more information - even if it can be construed as public curiosity.

'Temasek is seen as a company that belongs to the Singaporean people. Therefore, the public's heightened sensitivity or interest, even if unnecessary or excessive, has to be understood and appreciated,' says Mr Tan.

In Mr Singh's view, people want to know why the CEO succession process failed because the dearth of answers on Mr Goodyear's resignation is in stark contrast to the deluge of information when Temasek announced in February that he would be its new chief.

'We were told of the thorough process by Temasek's board in selecting the new CEO. Minister Tharman also shared with Parliament how Temasek did the right thing and found the best person for the job,' he notes.

'It is, therefore, to be expected that people want to know what went wrong with the process which was said to be thorough, because we cannot afford to repeat the mistake in the future.'

The vocal backbencher and businessman, who was among four MPs who sought answers in Parliament, suggests that people's trust in the Government may be at stake.

'If this is what we can expect of how Temasek will manage our reserves, then we all need to know what went wrong, if the Government wants to continue to expect Singaporeans to have confidence and full trust in what the Government and its agencies are doing,' he says.

Who wants to know

BUT who exactly are the people demanding answers?

It is tough to pinpoint an exact group or how large it is as interest in Temasek is varied and widespread, note observers.

But one thing they are sure of: What sparks greater public scrutiny in Temasek is usually bad news.

When Temasek reported huge losses due to the global economic crisis, the man in the street became interested as it was viewed as his money lost, notes Mr Singh.

'They were talking about it in the coffee shops,' he says.

But when Mr Goodyear resigned and the reins were handed back to CEO Ho Ching, it aroused the interest of professionals and the business community more than the common folk, he adds.

Some people's interest is also piqued because Ms Hois the wife of Prime Minister Lee Hsien Loong, says Mr Tan.

Just as there was a lot of speculation about why she was leaving Temasek and what she would do next, there is also interest in her staying on and for how long.

'They are all interested in information that can help them make better sense of Temasek,' notes Mr Tan.

'Of course, some of this information may in turn be used to criticise Temasek, the Government and the Lee family for a variety of motives and motivations.'

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.