Concerns over unsatisfactory returns

THE TAP board of director's claim recently declared zero per cent return on Investment for its members' saving for the financial year 2008-2009 blaming it on the global financial crisis. The chairman also considered the decline in investment performance as 'out of the ordinary' and claimed that financial institutions all over the world were also experiencing the same situation.

This is really an exasperating and unacceptable justification. Do you know that Kumpulan Wang Simpanan Perkerja (KWSP), Malaysia declared a dividend of 4.50 per cent for the year 2008? KWSP in its website acknowledge the current financial crisis and the challenge faced for the year 2009 yet their Return on Investment declared is not ZERO per cent.

Does TAP have competent Board of Directors and Investment Panels in making the required investment decisions that really benefit its members? Is their Investment Section populated by competent officers with comprehensive and relevant Investment knowledge and attitude that could drive its Investment to success?

It is high time for TAP to be more transparent on its Investment and Reserve Policy (do you have any?) as part of their Corporate Governance. TAP are just Trustees hence members are as stakeholders should be given privilege to know how and where their money are being invested. The investment portfolio proportion for example equity, bonds and cash are important information for the members and should not be classified as confidential.

Another matter of concern was during TAP's Appreciation Night 2009 when awards are being doled out for outstanding performance. Well, this certainly was not was not being reflected in the Rate of Dividend declared! I really thought that before being awarded these officers should set and reach a certain target and I assume that zero per cent Return on Investment was not a flattering target.

Another word of advice, before TAP considers in venturing into new investment portfolio as informed by the Chairman where have successfully widened its asset classes by investing in real estate investment (REITS), TAP should be improving on its current portfolio as well as the competency of its Investment Officers and should not be too dependent on their fund managers. TAP should also spend the members' fund prudently and intelligently as we unforgivingly witness that their TAP's Appreciation Night2009 was held at a hotel amidst the Investment Crisis.

Another concern (after vigilant research) is the increasing number of employees during its corporatisation which have increased the total expenditure and not forgetting the lavish office renovations apart from its too generous acting allowances. For me this has contributed to the unsatisfactory Return on Investment. Remember, TAP as the champion for Financial Planning Roadshow, should walk the talk!....
:extracted from Bulletin Your Letters column:
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