KUALA LUMPUR: The Employees Provident Fund (EPF) expects its investments to reach RM500bil by end-2013, said deputy chief executive officer (investment) Shahril Ridza Ridzuan.

He said the fund's investments stood at RM385bil in the first quarter of this year compared with just RM9bil in 1980. The EPF has over RM370bil in funds.

“We are chalking up about 8% compounded annual average growth now and by this, we expect our investments will be RM500bil by the end of 2013,” he said yesterday at a media briefing and media launch of EPF corporate governance principles and voting guidelines.

“There are two things that support the 8% annual growth. One is that when we pay dividends, we don't pay in cash but credit the amount into investors' accounts and reinvest,” he said.

The other, he said, was that the country continued to grow in terms of population and this brought in a net inflow of workers.

“The total gross net income contribution exceeded the net outflow as a result of people retiring,” Shahril said.

He also said the EPF was guided by the Risk Appetite Statements, where it would not tolerate a greater than 10% chance of dividends falling below 2.5% in any year over the next 10 years.

“We too will not tolerate a greater than one third chance of the annualised dividends falling below inflation +2% over any rolling three-year period,” he said.

On the booklet launched yesterday, Shahril said it was part of the group's efforts to promote and educate companies on corporate governance. “Investors and regulators can expect to see better corporate governance from investee companies with the introduction of this booklet,” he said.

Shahril said the EPF believed that good corporate governance was not only about commitment to values and ethical business conduct but also about how an organisation was being managed. The booklet, which will serve as a guide to EPF and investee companies, was aimed at being more stringent on corporate governance issues that emphasise accountability, integrity and transparency of the boards of directors and disclosures made by listed companies.

Among the booklet's focus areas were size and composition of the boards, separation of power between the chairman and the chief executive officer, re-election of directors, board committee, authority of allot and share issues pursuant to Section 132D of the Companies Act 1965, employees share option schemes, related-party transactions and dividend policies.

source HERE

Posted by Mr Thx Thursday, May 20, 2010


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