Govt to ensure Felda scheme sustainable


  • Business
  • Wednesday, 10 Apr 2019

Several new emphasis have been identified and among them is to restructure Felda, strengthen its core activities by identifying a new plantation management model, strengthen its financial position and intensify initiatives that are linked to the welfare and prosperity of the settlers

KUALA LUMPUR: The Government will inject RM6.23bil and introduce a short, medium and long-term initiative to ensure that the Felda scheme continues to be sustainable in the future.

The agency also has to utilise its resources optimally to ensure that greater economic opportunities along with generating higher incomes for settlers.

“Several new emphasis have been identified and among them is to restructure Felda, strengthen its core activities by identifying a new plantation management model, strengthen its financial position and intensify initiatives that are linked to the welfare and prosperity of the settlers,” said the White Paper.

Felda will also raise its value-added activities and improve synergies through out its value chain via strategic cooperation with agencies that are involved in high potential farming and plantations.

For the short-term, measures have been identified to improve accountability and integrity within Felda to ensure public confidence and trust from the public, said the White Paper.

Steps are also being taken to make sure there is no political interference in the management of Felda to ensure that management is transparent and responsive.

According to the report, the government views the issue of embezzlement, misconduct and governance in all seriousness given how those factors have had a direct impact on Felda’s operations. 

“As a result, stern action will be taken on the person/persons responsible to send a strong message to officials and employees of Felda that there would be no compromise in misappropriation and abuse of power. 

“Felda will also empower an integrity complaint system and use The Whistleblower Protection Act 2010 to encourage individuals with information to step forward so that any misconduct particularly in regard to integrity can be stemmed from the very start.”

In the short-term, Felda will also initiate a group-wide structural reform to raise the level of professionalism based on the highest standard of corporate governance.  

It will also ensure that appointments of the management team are made up of professionals of credible stature. 

Besides that, to ensure that the voice of the Felda settlers is taken into account in shaping Felda’s direction, the organisation’s board of directors and management will be represented by the settlers’ representative and also from the new Felda generation, the report added.  

Felda will also study the involvement of its football team, FELDA United in Malaysia Super League which involves high financing cost. 

According to the report, several improvements in corporate governance have been taken on the structures of Felda, FGV Holdings Bhd and its subsidiaries. 

* The appointment of the chairman of Felda, FGV and FIC are from the circle of professionals and not based on political connection. 

* To ensure a separation of management accordingly between the chairman of Felda and the chairmanship of Felda subsidiaries with the aim to avoid conflicts of interest in decision-making that would be made by the board of directors of each company. 

* To undertake a management audit to raise the efficiency and effectiveness of the management of the people to the optimum level and of integrity. 

* To establish an investigation committee to execute action on the proposals and recommendations in the forensic audit report that was conducted. 

* To take stern action on officials and management of Felda involved in the embezzlement issue. 

* To improve the standard operating procedure to ensure accountability in the running of Felda. 

* To study related amendment of act/regulations in line with the new Felda model. 

* To improve management structure and the practice of lean management. 

Towards this end, the report said Felda will initiate among others strategies like right-sizing, eliminating department and company overlaps, realignment of main functions and business process reengineering. 

These holistic reforms are vital to ensure that Felda is able to spur growth and contribute towards the development of the settlers’ community. 

Related stories:

Govt to provide RM6bil aid to Felda

Forensic studies on Felda's investments

Felda White Paper highlights: Finances worsened after 2012 FGV listing

New business model by Felda


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