In a letter to the media released via SGX on Jan 7, City Developments Limited’s (CDL) executive chairman Kwek Leng Beng referred to the “recent media reports” with regard to the changes to the board of directors at CDL.
From October 2020 to January 2021, three directors, including Kwek Leng Beng’s cousin, Kwek Leng Peck, have resigned from the board in relation to CDL’s investment in Sincere Property.
Drawing on his own experiences having sat on various boards of the Hong Leong Group for over 40 years, and as executive chairman of CDL since 1995, Kwek says he believes that he has “sufficient experience to assess what makes a successful board”.
He then highlighted the rules limiting the tenure of an independent director, where a director who stays on after nine years on the board is deemed non-independent, and he or she would have to undergo a “two-tiered voting”.
“But beyond the letter of the law relating to these and other stipulations, we must address the role of and value that an effective board member can bring to foster business success. If a business fails, there is no shareholder value to speak of,” he says.
On the role of the directors, Kwek adds that “when the management presents a business strategy, the Board should ask tough questions and raise concerns openly and robustly. Recommendations and constructive advice can be made to refine the strategy. But once a collective decision is made, unanimously or by majority votes, a director who may have disagreed, should now support its successful implementation.”
Referring to the recent changes from the board at CDL, Kwek thanked the outgoing directors for their past contributions, and said that the new non-independent directors bring to the table a diversified set of skills and perspectives, as well as “different industry experiences at senior levels”.
The CDL board welcomed five new directors from October 2020 to January 2021.
They are: financial services industry veteran Colin Ong, hospitality veteran and entrepreneur Daniel Desbaillets, seasoned international fund manager Chong Yoon Chou, CEO of CGS-CIMB Securities Carol Fong and Philip Lee, a chartered accountant with 35 years of accounting, audit and finance experience.
“With such deep expertise and networks, these Directors, together with existing Directors, will refresh the Board and Board Committees. The vigour and insights of the refreshed Board can foster success for CDL’s strategy of Growth, Enhancement and Transformation to deliver sustained shareholder value,” says Kwek, who concluded the letter with the adage “effective people are not problem minded. They are solution minded. They feed solutions and starve problems.”
Shares in CDL closed 8 cents lower or 1.0% down at $7.55 on Jan 7.
