The global economy was a strange beast in 2024.
On one hand, it was so good to EPF that EPF gave the highest dividend in years but it was so bad for Petronas that its profit fell by 32 percent and it will likely have to take “right sizing” measures in order to ensure its survival.
What is "right sizing" you might ask?
Well, it is actually synonymous with downsizing, or you having to reduce the number of people on your payroll because you can’t afford to employ them any longer, but when you call it right sizing instead of downsizing, you can make what essentially is a lost, to sound like a win by another name.
Image, you see, is very important to top people and corporations today. It is so important, that for all you know, their image might be more important than the reality of their circumstances. That is why a top corporation or individual, will likely go through a lot of trouble to create a suitable image for themselves, even if the reality is that the opposite is the case .
So what am I saying here? Is the performance of Petronas and EPF in 2024 just an image, or a facade of reality, that both EPF and Petronas have concocted in order to pursue their respective goals, interests and prospects ?
Is that the reason why one corporation did extremely well while the other did poorly in the same economy of 2024?
Well, of course if you talk to clever people, they will explain to you that this is not the case at all. There is nothing strange about one company doing well and another doing badly in the same economy.
“Even during economic depression some businesses will make money and even in the best of economies some business will close shop,” they will explain to you, before telling you that comparing EPF to Petronas is akin to comparing apples to oranges, and then give you a detailed breakdown about why Petronas lost money and EPF made money, in a way that will cause you to just give up and say “ ok la …ok la…I see that you know what you are talking about ….so I will just trust you and believe that you know what you are talking about and that you are right. “
I don’t think that we realise how much the world is actually run by trust. Our view of whether our country or our corporations like EPF and Petronas are doing well, is actually dependent very much on trust.
Most of us actually know next to nothing about what is going on in EPF or Petronas or whichever other company that belongs to the nation. We just trust that our leaders, government and professionals know what is going on and that they will read reality to the best of their ability, and do whatever is in the best interest of these corporations for the sake of the people and the nation, regardless of whether it is pursuant or against their self-interest and wellbeing.
This however, is the theory. Practically speaking, we must also understand that our leaders, government and professionals are just people, and people being people, will always have to take care of their self-interest, and not just be expected to uphold their principles.
Of course, as decent individuals, we are all expected to always put our principles above our self-interest, and only pursue our self interest for as long as it doesn’t run contrary to our principles, but when the going gets tough, it will require the utmost discipline and integrity to discard our self-interest, for the sake of our principles.
Is our government, leaders and professionals decent people who can be counted to always put their principles above their self interest?
I shall leave it to you to answer the question for yourself.
What I do know however is that EPF’s top brass is currently mired in a controversy involving a RM 500 million loss that EPF suffered in 2024, due to a “buy high, sell low” transaction involving MAHB shares in 2024.
That EPF has announced an unexpectedly high dividend for the year 2024, will now probably make it much harder for EPF’s critics to accuse EPF’s top brass of any wrongdoing over the MAHB share sales in 2024. How can you blame the same management for dodgy action that resulted in RM 500 million in loss last year, when the same management also had done so well for EPF that you are now enjoying an unexpectedly high dividend for your EPF savings?
As for Petronas, the fact that its profit fell almost a third will also likely make it much harder for Sarawak to ask for much more concessions from Petronas. For context, Sarawak and Petronas are currently embroiled in a dispute, whereby Sarawak is asking Petronas to cede the oil and gas extraction rights it has over Sarawak’s oil and gas resources, to Petros, the oil and gas company run by the state. Supposedly, Petronas and Sarawak had already come to an agreement in regards to how to share Sarawak’s oil and gas resources amongst them early this year, but from way that the Sarawak state government is reacting to the agreement after it was announced by the PMX Anwar, it seems that the dispute is likely still ongoing.
But considering that Petronas has announced a huge loss in its profits, as well state that its circumstances is so poor, that it is being forced to right size its workforce, will likely make it much harder for Sarawak to ask much more from Petronas than what PMX Anwar has already agreed to give them, which according to some Sarawakians, amounts to next to nothing.
By the way, EPF and Petronas are not the only government linked corporations that had an odd 2024.
Another corporation is the HRD Corp, which announced that it had set several records last year, to the point that 2024 was its best year ever.
HRD Corp if you remember, was also implicated in a scandal last year, whereby it had failed the audit by the Auditor General so badly, that the Auditor General had referred HRD Corp to the authorities for mismanagement.
In July last year, the HRD Corp CEO was even forced to go on leave pending a probe by MACC.
That despite such bad press last year, that HRD Corp has now reported that it “set records” and “had the best year” ever in 2024, will now likely remove any aspersions that any wrong doing had happened in HRD Corp last year.
Like I said, we likely do not realise just how much of our world runs on trust.
Seeing so, we can only hope that our corporations, leaders and government are promoting an image of themselves that is congruent with the reality of our situation, and not concocting an illusion despite the reality of our situation.
If our leaders, corporations and government are acting in tandem with reality, then we have nothing to worry about.
If they are not, however, we are going to find out just how much of the world is run by trust, when the trust that we have placed on our leaders, corporations and government is broken.
Once trust is broken, it will take forever to re-establish it again.
For our sake and our nation's sake, let us hope that the trust between the people, the government and the institutions, is never called into question.
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