The panel also wants the appointment of the general manager of the Port Klang Authority (PKA) to be approved by the board to prevent the holder of the position from being beholden only to the transport minister.
But the PKA was non-committal when its chairman was asked if it would adopt the long list of recommendations given by the committee which consists of members of Transparency International Malaysia, the Malaysian Institute of Accountants, the Malaysian Institute of Corporate Governance and National Audit Department.
The committee’s findings and proposals comes a month after it was set up to look into ensuring that weak practices of the past were not repeated.
Transport Minister Datuk Seri Ong Tee Keat had announced last month the formation of the committee as part of the government’s efforts to turn around the PKFZ project which has escalated from an initial cost of RM2 billion.
A report from auditors PricewaterhouseCoopers (PwC) released on May 28 showed the project’s cost may ultimately spiral to as much as RM12.5 billion.
Speaking at a press conference here today, the committee chairman Datuk Paul Low said the structure of PKA did not make it possible for the body to be involved in business.
“The regulator cannot go into business enterprise,” said Low who presented the committee’s 38-page report today.
As such, Low said that among the recommendations were that board members of PKA and PKFZ be independent of each other and at least one-third of both board members be independent non-executive directors.
The committee also defined independent board members as those who are not political appointees and also not a nominee of the transport minister.
The committee also wants the appointment of the general manager of PKA to be approved by the board.
“The general manager in PKA who by virtue of the powers in the Act is appointed by the minister and therefore, may erroneously assume that he is only accountable to the minister and not the board,” said the report.
But the committee blamed past board members for negligence which resulted in violations of governance.
The committee also recommended the strengthening of the internal audit mechanism by not having the chief executive or the general manager as the head of the audit department.
“It is apparent that the former general manager being the CEO also chairs the audit committee and the staff of the internal audit department were accountable to her directly,” said the report.
The committee also suggested the formation of various internal committees on ethics and corporate governance.
The report of the committee has been submitted to Transport Minister Datuk Seri Ong Tee Keat.
PKA chairman Datuk Lee Hwa Beng who was also present at the press conference refused to say whether the body would adopt the recommendations saying that it would be discussed at the board meeting on Friday.
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