More than five years have passed since the Asli corporate study report revealed that Bumiputera ownership of corporate equity in the Kuala Lumpur Stock Exchange had exceeded the 30 per cent target.
The study’s findings of a 45 per cent Bumiputera share were based on a different method of measurement compared with the official one. Using market value as opposed to the par value valuation official method, and allocating the equity of GLCs according to racial share, the study noted that it was time to do away with the policy which had been implemented since the 1970s.
The study’s findings raised a hue and cry not only because it challenged the official data on the share equity attained by the Malay community but more importantly because it challenged the official orthodoxy.
Strong reactions from various Umno leaders at that time indicated their fury — and perhaps fear — that the Asli study negated a long-held belief on how the Bumiputera corporate equity strategy was necessary for Bumiputera economic advancement and synonymous with the interests of the Malays. Lost in the firestorm were the study’s recommendations that encompassed a wide spectrum of issues. Those recommendations are reproduced below. I hope they will be read more carefully by the present crop of policymakers and politicians that are trying to find their way out of what has correctly been referred to as the “bastardisation of the NEP” — an assessment made by one of the nation’s foremost bankers, Datuk Seri Nazir Razak.
Corporate equity findings (from Centre for Public Policy Studies’ Report)
It is understandable why Perkasa and similar parasitic groups are raging away at the corporate equity issue. The ultra nationalist movement badly needs issues that can burnish its credentials as the protector of Malay interests and derail the structural reforms the country needs to flourish.
What is incomprehensible is why Umno continues to harp on the attainment of the racial corporate equity share target as a key goal to be pursued for the Malays and country as a whole.
It is absolutely the wrong target to focus on because it has been conclusively shown to benefit only a small minority of well-connected and already wealthy business and political leaders — numbering perhaps no more than a few tens of thousands of individuals and their families at most.
One would have thought that the RM52 billion out of RM54 billion of equity value sold off by Bumiputera preferred investors between 1985 and 2005 would be sufficient proof that these individuals do not need more perks and special treatment.
More important, the Bumiputera corporate equity target is the wrong one as it will only distract from the more important challenges that the nation and especially the Malays and other Bumiputera communities need to face up to.