Sunday, January 11, 2015

Unethical Malaysian businessmen

Recently, there was a brief skirmish in our Whats App group on the Malay agenda.

A dear log time friend, whose likely is fed-up with too much NATO on the subject of the Malay agenda, summarised his disgust by saying if Malays are still reliant on Chinese for goods and services, talk of Malay agenda to "perkasakan bangsa" is futile.

There is truth to what he said but one cannot just sit back and let it come. Something must be done. Effort must be made within the community. Enough of government must do this and that. The activist must not hope on others or bureaucrasy to do it for them.

As someone trained in Engineering and is in an operational corporate position, doers are naturally disgusted with polemics and rhetorics. But, the big picture macro discussion is necessary.

The Malays' problems are so deeply imbedded in their psyche as a result of their socio-political history that looking at it strictly from a retail economic delivery system suffers from myopia. To expect the creation of Malay businessmen as the yardstick of community development, it is a delusion.

Malaysian businessman generally do not abide to any form of rules and ethics. They are self serving and that attitude is translated in their open confession of being bottom line driven, penny pinching obsession, and end justify the means moral platform. 

Bankrupt in Ethics

That is just the opening for this article found in FMT, reproduced below:
Why are M’sian businesspeople so bankrupt in ethics?

January 6, 2015

Now that the government has finally decided to float the fuel cost it is puzzling why traders are unable to bring down the price of goods and services.

By J D Lovrenciear

For a very long period our nationwide experience has been one of spiralling prices that the business community quickly justifies as due to the “increase in fuel cost”.

Each time the government announces an upward revision of fuel prices, hot on its heels are the price increases in “teh tarik” at 10 to 20 sen more a cup.

And along with it is the argument that cooking gas has gone up; sugar has gone up; cooking oil has gone up; and so on and so forth.

One wonders how on earth these traders and businessmen manage to revise their prices almost overnight all in the name of keeping profits intact if not doubled.

And now that the government has finally decided to float the fuel cost along with global pricing, it has become even more puzzling why traders and businessmen are unable to reduce the prices of their goods and services.

While the cost of fuel at our pumps is reduced, we instead get petrol pump operators telling us that they may have to close shop because of the lower pricing of fuel.

Mind you, when prices were increased every now and then these past decades, these same operators were only too happy to revise their pump prices not to mention capitalise on the huge spare inventories they would have craftily reserved in time with the rumoured price increase.

Likewise, our 24-hour eateries that are insisting that the cost of teh tarik and air suam cannot go down even by one sen.

Anyone who has been to Thailand, Myanmar, or even India for that matter will tell you that their traders dutifully revise their product prices with the price of fuel for the day or week.

There is no need for enforcement in these nations. Traders allow their ethical bearings to dictate. They take it in their stride as part of their duty to nation-building and service to its citizenry.

Even in wet markets all across Thailand for example, the prices of greens and fish and poultry is adjusted for the day by the traders. But do we experience the same in Malaysian markets?
Why are Malaysians so bankrupt in ethics when it comes to business? Do we blame law enforcers? Is profiteering already a deeply entrenched pattern that being ethical in business has become almost alien to our business community?
Similarly, too, Malaysian consumers lack the will to fight this unhealthy practice in the marketplace. We continue to patronise the mamak shop or buy chicken and vegetables when we know that the price is unfair and unjustified given the reduction in fuel cost.

Malaysia’s new experience of a downward adjustment of fuel costs has revealed the extent and seriousness of how far ethics has miserably failed to take root in the country after all these decades of securing independence and self-governance.

Whatever happened to ethics in this country?

Do we blame the government? Do we blame law enforcement? Do we blame consumer organisations? Do we blame NGOs?

Or should we not blame ourselves for our pathetic lack of will to force the business community to be like their counterparts in Thailand, Myanmar and India who do not practice “opportunistic-profiteering” at the expense of nation-building and the citizenry.

J. D. Lovrenciear is an FMT reader

Entrepreneurs is important in the logistical sense of being part of the distribution of goods and services. They form part of the symbiosis between business and community. Entrepreneurs need community support and community get the benefit of their distribution role.

But when it comes to other social and community role, why do most entrepreneurs shy away from and hid behind excuses of not making enough, time is tough and those mantras of bottom line, and unethical value statement.

In return for the wealth or at least, ability to make a living in the community, they should be able to contribute to society and nation without being driven by bottom line, profit and greed.

Businessman should also play apart in the nation building effort by supporting social and political (governance sense) effort. a peaceful and prosperous community comes back in the form of more benefit to businesses.

Self serving  

As far back as early 2000, government have long warned of the labour cost trend and Malaysia can n more afford to be low cost producers.

Malaysia should be moving up the curve into more knowledge intensive business and industry, and upgrade its business processes and undertake automation.

Instead, the big businesses move abroad to other country and maintain its low cost production businesses. The retail typed businesses and industry just import foreign labours for cheap and that proliferate into a human trafficking "industry".

They are not willing to invest and spend money for more automation, upgrading equipment and redesign their business to move away from low cost and be productivity driven. That was the way to sustain in a higher labour wage environment.

They couldn't care less and resort to cheap foreign workers that come with social and security problems which does not benefit the country in the long run and also themselves.

Tax evaders

Yet come budget time, Malaysian businessman kept coming up with long list of demands for more tax incentives, less import duties, relaxation on the bringing foreign labours, etc etc etc. They do not pay tax but argue on their basis as tax payers.

Hambug! Petronas and GLCs are the major tax contributor and contribute more than 65% of tax.

With smuggling activities so widespread and bribes are paid by these "businessmen" to government servants, they should not claim that excise tax that arise from their import and export businesses are  a major contributor to government revenue.

The underlying reason behind the opposition to GST, but hiding behind the excuse of higher cost of living to the rakyat, they will have to reveal their taxes and they just refused.

With the 6% GST, there is supposed to be no more hidden 11% SST, but no ... the price will remain. Heard there is a cartel agreement that Malaysian businessmen will add on another 6% and now they have hyped up in the newspaper that certain goods will sure to rise.

We have not delve on the subject of underworld related businesses linked to prostitution, gambling, drugs, money laundering, extortion, etc etc etc. That in itself is RM500 billion a year business (as told by a former top cop) and it is interlinked to the real business. Hmm ... what is the nation's GDP?

Life is tough and will continue to be tough for decent honest businessmen trying to make a decent living in Malaysia till policemen and anti corruption men are allowed to do their work unhindered by politics, power play and sentiment driven psyops.

Policy makers?
It is relative but generally Malaysian businesses are unethical and corrupt.

Yet we pin so much hope and give so much consideration to the view and economic interest of the business community in the planning and shaping of this nation.

Business ability to distribute goods and services cannot be the yardstick to target for in uplifting the Malays' socio-economic. It will only mislead the Malays to the wrongful ways of improving their livelihood.

Helping the Malays do encourage subsidy mentality and a dependent psychology. On the other hand, expecting free market will make them raise to the occasion and improve them is a wet dream.

The cliche of making them competitive is a false dream because the system have been proven not to give them the opportunity to be build competency. The Malaysian environment is not fair and ethical, thus truly capable people may not be able to harness their ability and be successful unless cable, trickery and treachery are applied.

Affirmative action may be seen as discriminatory on other races. However, hidden in the pages of history is the discrimination by the colonials and ruling Malay elite on the Malay masses and in favour of the immigrant.

Before independence, not a single acre of land was given by the colonials to the Malays in the Malay federated states but thousands are given to immigrants as gold and tin mines in which some of them do not even live in Malaya.

Only during the short NEP period did mass Malay ever got a chance to get started. Whatever is the remain of affirmative action, it favoured the urban Malay and those with access.

One hardly hear successful Malay businessmen pouring back money to uplift their community. They are still talking in the language of government should do this and that.

Where affirmation action attempted to help Malays in the past, discrimination, sabotage and corruption by businessmen held them back.

The sad fact today is all the agencies assigned to help the Bumiputeras do not acknowledge this reality and operating on false presumption. Some like Teraju are indulging in a notion of cronyism when their thinking focus is to create entrepreneurs out of corporate man and professionals. 

Until Malaysian businesses appreciate ethics and sense of fair play, we are all talking cock!

* Edited 2:20 PM 12/1/2014


JohirMali said...

JD Lovranciet lamented

"Mind you, when prices were increased every now and then these past decades, these same operators were only too happy to revise their pump prices not to mention capitalise on the huge spare inventories they would have craftily reserved in time with the rumoured price increase."

This clearly indicate his zero knowledge about the petrol station businesses.

First and foremost, we do not decide on the pump price, the government does.

We do not decide on the supply of fuel to the station, the oil company does.

There is no question of hoarding supply in anticipation of price increase nor refusing supply when the government decide to reduce pump price in a few days time.

Anonymous said...

After watching the movie "The Equalizer" with another solid performance by the stoic Denzel Washington, I do believe one day here in Malaysia street vigilantes will take the law and justice into our own hands.

- Heart of the Sun

Anonymous said...

I think its a bit unfair saying its a malaysian thing. Its a capitalist thing. The problem is the decision makers and the enforcers are just plain stupid. It is a malay thing to just get enough and that's that. Why do more when enough is more than enough? Decision makers are mostly stupid malays and enforcers are also stupid malays being taken for a ride by the capitalists. But when the malays set the bar higher, they are prone to "gift giving" by the capitalst. Then it becomes doing minimal but gaining maximum. And capitalist are those that came on their own accord when the brits opened up the tin mine.

Anonymous said...

A good analysis that needs action.

Anonymous said...

A bit on petrol kiosk operators.

If not mistaken, understand that their income is commission based.
If so, whichever way the fuel price goes, it should not affect them much on a long term basis. Matter of fact, lower fuel may be better for them as people will buy more fuel.

For short term basis, perhaps they may encounter some stock related loss if fuel price goes down or vice versa.

My Say