Chief Minister Datuk Seri Hajiji Noor (third left) receiving the cheque replicas from SMJ Energy Executive Director, Upstream Datuk Albert Lo while others look on.
KOTA KINABALU: State government-linked companies (GLCs) in Sabah that fail to generate earnings for five consecutive years may face shutdown orders if they show no prospects of recovery, says Chief Minister Datuk Seri Hajiji Noor.
Underperforming GLCs will be placed under review and scrutinised by the State Government Companies and Statutory Bodies Monitoring and Consultant Committee.
“The State Government will not hesitate to issue a shutdown order if the GLC concerned does not show any prospect of recovering,” Hajiji said at the GLC and statutory bodies dividend and contribution presentation at Menara Kinabalu on Thursday (Dec 18).
Hajiji emphasised that all statutory bodies and GLCs must comply with the minimum dividend payment rate of 10% of profit after tax, a long-established requirement. He expects GLCs to demonstrate financial discipline and full commitment in meeting this obligation.
From next year, he wants to see annual contributions from GLCs increase, ranging from around RM2mil to RM10mil, depending on each company’s capacity and performance.
Hajiji reaffirmed that the state will revamp GLCs’ chairmen and board members to strengthen corporate governance and accountability, and inject new leadership into these companies. While appreciating the contributions of past leaders, he said a revamp is necessary to ensure effective and sustainable transformation.
He highlighted the importance of having a dynamic, professional and results-oriented leadership team to drive Sabah’s development agenda, including strategic investments, digitalisation, new energy and social development.
“Steps are being taken not just to change leadership but also to ensure GLCs are more competitive and ready to lead Sabah’s new development agenda,” Hajiji said.
He said Sabah aims to improve GLC performance in line with the Sabah Maju Jaya 2.0 goals.
“Our main objective is to turn GLCs into an efficient and trusted economic catalyst through credible management to generate higher income and value for the people and state,” he said.
Hajiji reminded all GLC and statutory body leaders to submit quarterly written performance reports directly to him from next year, including project progress, financial status, KPI achievement and operational efficiency. He warned that those failing to submit reports, meet KPIs or who perform unsatisfactorily will have their positions reviewed, including possible replacement or termination.
Current reports show overall GLC performance remains at a medium level, with total dividends and contributions to the State Government at RM131.6mil, compared with the highest recorded in 2022 at RM156.31mil.
“Although these figures indicate positive contributions, I believe the true potential of government-owned agencies is far greater than what has been achieved so far,” Hajiji said.
He stressed that the State Government demands financial integrity, transparency and accountability, urging all directors and top management to work as a cohesive team in decision-making and strategic planning. He expressed confidence that with updated business direction and disciplined governance, agencies will increase returns and deliver benefits to the people.
Hajiji said Sabah must begin venturing into strategic fields such as artificial intelligence, renewable energy, aerospace and data technology to remain relevant in global growth. He also welcomed the Malaysian Anti-Corruption Commission recommendation for each agency to appoint a Certified Integrity Officer or establish an Integrity Unit for better oversight.
Later, Hajiji received cheque replicas from various GLCs and statutory bodies totalling RM131.6mil, with the largest from SMJ Energy Sdn Bhd, which paid a RM50mil dividend and RM1mil contribution to the State Natural Disaster Committee.
