This article first appeared in The Edge Financial Daily on June 26, 2019

KUALA LUMPUR: The Employees Provident Fund (EPF) commented that the remuneration of directors must be linked to the performance of the company, in response to questions from The Edge Financial Daily following the unexpected move by FGV Holdings Bhd’s substantial shareholders to vote against directors’ remuneration yesterday.

The EPF, which holds a 1.85% stake in FGV, had raised concerns about the quantum of directors’ fees paid to the board of the plantation giant, although it did not vote against the three resolutions at the company annual general meeting.

Asked if the EPF wants FGV to cut director fees, the board’s chief executive officer (CEO) Tunku Alizakri Raja Muhammad Alias said: “No, but it must be linked to the performance of the company”.

“We have always closely scrutinised the performance of our investee companies, which include the board and management. Where the company’s performance merits it, the CEO will be recognised accordingly.

“History has shown that we will make our feelings very clear if we are not satisfied with how a company is being managed and/or governed,” he said.

Asked how much the remuneration should be, Alizakri said that the fund wants what every shareholder wants — a well-run company that brings good return on investment.