Should Zarinah step down?

The anonymous comment about Zarinah's husband that appeared at Rocky's Bru.The anonymous comment about Zarinah's husband that appeared at Rocky's Bru.The anonymous comment about Zarinah’s husband that appeared at Rocky’s Bru.A comment on the blog Rocky’s Bru (left) – asking why Datuk Azizan Abdul Rahman, husband of Securities Commission chairman Tan Sri Zarinah Anwar, is allowed to acquire shares in public listed companies when other SC employees and their spouses are not allowed to do so – has generated additional buzz on an already hot issue.


The Mole contacted Datuk Salleh Majid, a former Kuala Lumpur Stock Exchange president, for his views.


“Zarinah’s husband should not have anything to do with public listed companies simply because his wife is the SC chairman,” said Salleh.


When asked if Zarinah should step down as demanded by the countless calls, Salleh had this to say: “That is up to her, that is her decision. But if she feels hat she’s not guilty she should stay on.”


Salleh added that if Azizan was not involved in a public listed company, this problem would not have arisen.


Former president of Transparency International Malaysia Tan Sri Ramon Navaratnam is of the view that Zarinah is somebody who have shown a high standard of integrity and leadership.


“What her husband did appears to be a conflict of interest and is embarrassing for her and the Securities Commission.”


However Navaratnam said that it is incumbent for her detractors to convince the public that there is indeed a collusion between husband and wife in any business transaction.


“Otherwise it will be unfair to blame her for something she may not have knowledge of,” he said, adding that it is not clear if Zarinah was aware of husband’s actions relating to the E&O deal.


The Mole contacted SC employees who confirmed that they are not allowed to acquire shares in public listed companies and if they already own shares before joining the regulatory body, they will have to declare it.


Zarinah’s position as SC chairman was questioned when Azizan accumulated 450,000 E&O shares between last April and August.


This led to some quarters maintaining that as chairman of the regulatory body Zarinah must get her act together or step down. They also pointed out that this was not first instance that Zarinah was dragged into a controversial situation vis-a-vis her SC chairmanship..


Bloggers have ben busy digging up old news on this. Read here and here.


Checks with the SC website showed Zarinah had stated: “The Securities Commission is committed to the observance and practice of the highest ethical standards in conducting business with suppliers, contractors, vendors, consultants and other relevant stakeholders. Each and every member of staff is therefore expected to comply fully with the standards outlined in our Code of Conduct, Code of Ethics and this Statement of Principles and Standards. I believe this commitment and our uncompromising adherence to the standards prescribed are core to the effectiveness of the SC as the regulator of the capital market and to ensuring our continued growth as a dependable, trusted and respected organisation.”    


Read here for the full statement, with sections on “Ethics and Integrity” and “Conflicts of Interests”.


Another interesting point on the home-page is its compliance with the International Organisation of Securities Commissions’ (IOSCO) Objectives and Principles of Securities Regulation. Read here.


The assessment was based on 30 core principles developed by IOSCO, the world’s most important international policy forum for security regulators.


After being queried by the investing public and shareholder activists, the SC has said it will review all stock transactions made by all parties over the relevant period related to Sime Darby Berhad’s acquisition of a 30 per cent stake in property developer Eastern & Oriental Berhad.


On September 14, Zarinah said, “We will let you know when it is ready,” referring to the review.


Sime Darby had proposed to pay RM2.30 per E&O share for the block from three major shareholders – Datuk Terry Tham Ka Hon, Tan Sri Wan Azmi Wan Hamzah and GK Goh Holdings Ltd – at a price that worked out to a 60 percent premium to market.


Some parties suggested that Sime Darby should be forced into making a mandatory general offer for E&O as the company, together with the three shareholders who sold the block, has about 41 per cent equity interest.


“Naturally (my husband) had no knowledge of the Sime Darby purchase at the time as this is a sale by major shareholders and thebBoard was not told of the negotiations until later,” Zarinah said. Read here.


(more to come)



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