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Temasek CEO Ho Ching to retire on Oct 1, handing over to Dilhan Pillay

Temasek CEO Ho Ching to retire on Oct 1, handing over to Dilhan Pillay

Source: Straits Times
Article Date: 10 Feb 2021
Author: Poon Chian Hui & Choo Yun Ting

Her successor Mr Dilhan Pillay Sandrasegara, 57,  was the former managing partner of law firm WongPartnership before he was talent-scouted by Temasek some 10 years ago.

Temasek Holdings chief executive Ho Ching will retire this year, after 17 years in charge, handing over to Mr Dilhan Pillay Sandrasegara, 57, who will take the helm on Oct 1.

The Singaporean is the chief executive of Temasek International, the commercial arm of Temasek driving its investments, and will continue to hold this position.

At a media briefing yesterday, Ms Ho said the organisation has a strong team of many individuals who have deep experience and deep convictions.

"It's not a team that are 'yes men'. They do debate, and this is the strength that I see that Dilhan has been able to do... where he brought (them) together to overcome individual thoughts or individual ideas, but pulled together the different strengths."

Ms Ho, 67, who is the wife of Prime Minister Lee Hsien Loong, will retire from Temasek and step down from its board on Oct 1.

During her tenure at Temasek, the state investor's portfolio has more than tripled from $90 billion in 2004 to more than $300 billion now. It is a slight dip from 2019, in the light of the pandemic crisis that hit economies worldwide last year.

For example, last year, Temasek had to come to the rescue of Singapore Airlines, in which it is the largest shareholder.

While Temasek's portfolio used to be more focused on Singapore, it has diversified its exposure over the past two decades under Ms Ho's leadership. The Republic now accounts for about 24 per cent of the investor's portfolio, as compared with over 50 per cent in 2004. Meanwhile, its holdings in China have surpassed those at home.

Temasek chairman Lim Boon Heng noted that under Ms Ho, the investment firm has evolved from a relatively passive shareholder in former government-owned companies in Singapore to a globally recognised investor.

"It's hard to call out her many achievements, but perhaps above all else, she will be remembered for her unwavering commitment to build Temasek as a trusted steward, committed to the highest standards of integrity and governance," said Mr Lim.

At the same time, leadership succession is a "strategic responsibility" of the board, said Mr Lim.

Ms Ho has been very much part of this process, he added, and this involves identifying potential successors both inside and outside of Temasek. A key decision on Mr Pillay was made about two years ago, when he was tasked to head Temasek International.

Mr Pillay, a Cambridge-educated lawyer, joined Temasek in 2010 from law firm WongPartnership. He has more than 20 years of legal experience, mainly focusing on mergers and acquisitions, corporate governance and corporate law. He has since played several key roles in Temasek, including a two-year stint as head of Americas, based in New York.

Mr Lim said: "As he progressed in different portfolios within Temasek, all of us could see that he could deliver. And not deliver in the sense of himself, but pulling together the rest of the team to achieve that. That is why we're convinced that Dilhan is the right candidate to succeed Ho Ching."

Mr Lee Theng Kiat, Temasek executive director and Temasek International chairman, will also retire from his executive role at the same time but will stay on as a non-executive member of Temasek's board and as the non-executive chairman of Temasek International.

Mr Pillay said that he is grateful to Ms Ho and Mr Lee "for laying down a strong foundation for Temasek as it navigates a world of continuous change, increasing complexity and ambiguity".

Mr Ho Meng Kit, senior adviser at the Singapore Business Federation, said that Temasek, under Ms Ho's leadership, has also focused on the development of small and medium-sized enterprises (SMEs) alongside its larger portfolio firms.

Temasek's wholly owned subsidiary Heliconia Capital Management has invested in some promising SMEs, Mr Ho noted.

"I think this focus of not just looking after the top but the whole base of our business community will continue with Dilhan Pillay's leadership of Temasek," he said.


Transformation of Temasek into a global investment giant

A leader's lasting value is measured by succession. So said American author John C. Maxwell.

As any keen watcher of Singapore would know, succession planning has been a cornerstone of the Republic's success. In fact, it is embedded in the leadership culture of Singapore.

Ms Ho Ching's retirement from the helm of Temasek Holdings and its board on Oct 1 will be in keeping with this practice.

Her successor, Mr Dilhan Pillay Sandrasegara, 57, is a known entity. The Singaporean Anglo-Chinese School alumnus established a strong track record as a successful corporate lawyer at WongPartnership, where he was talent-scouted by Temasek some 10 years ago.

After a two-year stint as head, Americas, based in New York, he was appointed chief executive of Temasek International in 2019, managing the investment and portfolio activities of Temasek. The passing of the baton will no doubt be the hottest talking point in corporate Singapore circles this week.

Ms Ho, 67, who took the helm of Temasek in 2004, is one of the most enigmatic corporate personalities in Singapore. Some, of course, also took exception to the fact that the Prime Minister's wife was also heading the country's sovereign wealth fund.

Never mind that she grew Temasek from a passive custodian of some $90 billion in 2004 to become one of the biggest global investment powerhouses, overseeing a portfolio of over $306 billion at last count.

Of course, there were several well-publicised failures, not least of which was the attempted purchase of Thailand's Shin Corp. But that was due to politics within Thailand, not the quality of the Shin Corp asset.

There were also several other investments around the world that went sour. Show me an asset manager who hasn't lost some serious money, and I'll show you a snowy day in Singapore.

But under Ms Ho, Temasek became increasingly transparent.

Despite being an exempt private company which does not need to disclose its numbers to anyone but its single shareholder (that is, the Singapore Government), Temasek started publishing its detailed annual report 16 years ago.

Anyone with time to go through a Bloomberg terminal can find out, to the nearest cents, the exact value of Temasek's investments, gains, losses and overall portfolio.

Last year, Temasek emerged as the top global tech investor, investing around US$2.3 billion (S$3 billion) in tech-related sectors like e-commerce and life sciences, according to Global SWF... In all, Temasek deployed over US$11 billion in total last year, the world's fifth biggest investor.

Ms Ho also ensured Temasek - and corporate Singapore - had a heart.

Using her bully pulpit, she prompted corporate Singapore to take on issues of environment, social responsibility and governance (ESG) seriously.

The establishment of Temasek Trust and Temasek Foundation as the organisation's philanthropic platforms to support public good and social causes was a clear signal to corporate Singapore, and especially the "big boys", about where their hearts should be.

Are there areas where Ms Ho could have done better? Of course.

Perhaps one area is the rejuvenation - or lack thereof - of the boards of its local conglomerates. One need not search deeply to conclude that some of these boards could do with younger, more energetic and more forward-looking personalities.

Perhaps her reluctance to move aggressively was reflective of her more evolutionary approach to management.

Despite wielding veto power, she is known for her consultative style where everyone at the table gets heard. Investment managers are allowed to articulate and justify their calls.

Some insiders compare this to the "partnership" style practised in big law firms.

Perhaps one of her biggest achievements was recognising the potential power of corporate China and its capital markets very early on.

As Temasek's CEO, she made a strategic decision to take stakes in China's four biggest banks. And together with that, she facilitated a process for boards and management of these corporations to come to Singapore to learn, be exposed and exchange ideas on how global corporate leadership operates and how global capital markets work.

Several thousand Chinese corporate chieftains have gone through the "Singapore School of Management" since then. And in the process, Temasek helped build a huge reservoir of goodwill within corporate China towards Singapore.

Mr Pillay will have huge shoes to fill.

Unlike Mr Chip Goodyear, who was brought over in 2009 and did not last very long, Mr Pillay is a known entity at Temasek.

He has been a team member and been by Ms Ho's side as the figurative "last man in the room".

While the direction is likely to be similar, with the emphasis on ESG and sustainability intact, there could be a nuanced shift in investment emphasis.

Mr Pillay takes over at a time of massive technological disruption, compression of the tech cycle and uncertainties in global supply chains.

Last year, Temasek emerged as the top global tech investor, investing around US$2.3 billion (S$ 3 billion) in tech-related sectors like e-commerce and life sciences, according to Global SWF.

Temasek also extended its portfolio into urban farming and spent US$365 million in acquiring an 85 per cent stake in Israel's Rivulis Irrigation, which applies smart technology to agricultural systems. Other allocations included United States-based Impossible Foods and Australian start-up V2Food, which help drive ethical consumer food choices.

In all, Temasek deployed over US$11 billion in total last year, the world's fifth biggest investor.

Given where technology is heading, investments in this arena could become Mr Pillay's major focus in the years ahead.

But Mr Pillay is also a builder of platforms or companies.

He was the chief architect behind the restructuring of the four big "Singapore Inc" property portfolios of Jurong, Ascendas, JTC and CapitaLand. He is widely credited with spearheading the creation of Surbana Jurong.

Under his leadership, more of these scaleable platforms could be created to seek out global opportunities for Singapore.

Given the mega-trends and global changes swirling around the world, it is timely for fresh perspectives and a younger pair of hands at the helm. Mr Pillay fits the bill well.

A hallmark of a good CEO is knowing when to let go for the betterment of the organisation. On that score, Ms Ho has done well. And she is also sticking to the Singapore succession culture.


Temasek's focus will be climate change, says Ho Ching's successor Dilhan Pillay

Incoming Temasek chief executive Dilhan Pillay Sandrasegara said the state investor's focus and biggest consideration is climate change.

"It's impacting businesses in every sector, in every part of the world, and we have to think what that means for the various geographies that we're operating in," he told a briefing held at Temasek's Dhoby Ghaut office on Tuesday (Feb 9).

Mr Pillay, who will continue in his current job as CEO of the commercial arm Temasek International, will succeed Ms Ho Ching in her roles as Temasek CEO and executive director on Oct 1.

He joined the company in 2010 and was appointed CEO of Temasek International in 2019, where he oversees its investment and portfolio activities.

Temasek chairman Lim Boon Heng said that Mr Pillay, 57, will oversee Temasek's "stewardship role", particularly in its constitutional responsibilities to safeguard its own past reserves as a Fifth Schedule entity.

Mr Lim added that Mr Pillay has shown that he can deliver the goods and rally a team to achieve the end results.

Ms Ho said she is confident that Mr Pillay will take Temasek to the next level.

She told the briefing that he has the willingness and confidence to bring in good people and give young people a chance, which will stand the company in good stead in the future.

Mr Pillay, who attended Anglo-Chinese School, was the former managing partner of law firm WongPartnership, with more than 20 years of legal experience in areas such as mergers and acquisitions and corporate governance.

He also serves on the boards of the National Research Foundation and Enterprise Singapore, and is a member of the National Jobs Council.

He holds a Master of Law from the University of Cambridge and a Bachelor of Laws from the National University of Singapore.

WongPartnership chairman and senior counsel Alvin Yeo, who worked with Mr Pillay for around two decades, said his former long-time partner has the right qualities to take on the stewardship duties that come with his new position.

"He's a person who has a serious sense of duty and responsibility, so I have no doubt that he will discharge that responsibility to the best of his abilities," Mr Yeo said.

Mr Pillay is an innovative person, he added: "He's prepared to try new things, obviously having done the due diligence first, meaning he doesn't just do it the old way just because that's the way it's been done before.

"I think that's another trait that helps him in his role to try and take Temasek to a higher level."

Mr Pillay said he is excited about Temasek's plan for the next decade - it has committed to halve its net carbon emissions attributable to its portfolio by 2030 - and believes it is the appropriate direction path for the organisation.

"I think that if we do the right thing, things will turn out well for us, and by extension our stakeholders as well," he said.

He noted that Temasek is not going to be driven by how the stock market performs on a short-term basis, but focus on the long run and the long-term value proposition of firms.

"Building up our capabilities in areas like AI, blockchain, digital, (digitalisation), cyber, sustainability... those are all very important things, because they go to the health of the companies that we're invested in, for long-term sustainable returns. That's how we will approach it."

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

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