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Comment: Do SingPost errors indicate a deep weakness in the company?

Singapore: In a digital era when transactions, notifications and records are digitized, I would think that the postman will facilitate it.

But the news of Singp's investigations this week, after fresh images of mail found in the Ang Moo Ki trash cans were viral, and his latest update that led the case to the police touched the harsh nerves.

Last year, SingPost fired a postman after discovering he had rejected the doors letters and direct mail to a condominium, and a video about someone who opposed him and claimed that he just threw a warehouse of letters into a garbage bin passed viral.

SingPost also apologized just two weeks after receiving a series of complaints about unauthorized mail from residents.


These operational shortcomings raised questions as to whether the company's board of directors should be held accountable.

Are the failures in the management of these episodes, which may even occur with the best corporate governance, or can they indicate that the board has failed to carry out proper oversight and carry out its responsibilities?

The answer lies in the extent to which the board has taken the necessary and reasonable steps when it became aware of the problems.

In accordance with the Law on Trade Companies in Singapore, the Board of Directors is responsible for managing, directing and overseeing the company, and directors are required to act honestly and to use reasonable care in the performance of their duties.

In most companies, the board delegates an everyday role of management to a management team led by the CEO or equivalent, with the role of the board then focusing on advancing the interests of the company and its stakeholders through overseeing, guiding and maintaining leadership responsibly .

Symposium locker

A woman uses a locker station operated by Singapore Post. (Photo by Kamini Devadas)

But as part of its oversight role, the board is expected to provide the necessary resources for the company to meet its strategic goals.

The board must also ensure that there are appropriate policies, procedures and controls that are implemented in practice. It is responsible for appointing an ethical, competent and dedicated management team and establishing independent audit functions that provide reasonable assurance that policies, procedures, and controls are appropriate and effective.


Let's now consider the reported failures of the SingPost service – including a number of letters left on letter boxes, letters that are rejected, postal workers who deliver unsuccessful delivery notifications, but do not actually ring people's doors and leave plots on the doorstep of people, as well as allegations of forgeries for proof of delivery.

SingPost blamed the seasonal increase in demand in the period from November to December, and lists an additional 20 shipments every day. However, some readers say that these problems seem to be long-standing throughout the year, so it's hard to see how the mistake can be attributed to seasonal factors.

Seasonal waves of demand are also repeated in nature in the mail delivery business, so it is reasonable to expect management to forecast demand and allocate the resources needed to meet it.

SingPost also attributes the incidents of individual actions to several offensive employees. But many of these service failures are clearly not new. For several years, there have been complaints about unsuccessful delivery notifications, even though households had a home at that time.

SingPost then sent the latest case of mail seen in the Ang Moo Kio bin to the police, which may go some way to deter future hostile acts from unruly postal people, but could it distract from the essence of these problems? And will it solve all potentially deeper issues of corporate governance?

ping-mail is found in bin in anglo-kio

The resident says he found about 30 to 40 letters in the trash can. (Photo: Facebook / Alice Kettlin)

READ: Postman arrested for Ang Moo Ki resident in unopened mail found in rubbish bin


Between 2015 and 2016, a large number of corporate governance concerns about SingPost's business activities were triggered by a series of news reports and comments that later contributed to the company's board and senior management reconstruction. Understanding what some of these problems were about SingPost before those years can illuminate the root of service vulnerabilities in recent months.

One concern was whether SingPost's e-commerce and other areas will affect the quality of its traditional postal services and how SingPost is equipped to drive this new business model.

During the five-year period, the company made more than 20 procurements, spending more than half a billion dollars to transform SingPost from a mail delivery business to logistics and e-commerce business.

With traditional postal services transferred to the sunset industry, there was concern that the company could lose its eyes to ensure maintenance of service standards when other areas promise greater growth potential and have more attraction for deep-paced investors.

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The second concern was whether some of the longtime independent executives who have been there for two decades have been too long. Have you had relevant experience and skills in the context of the transformation of Singapost? Perhaps they have overstepped their boundaries in making decisions that may not be fitted?

Some of these directors have formed an unusually active executive committee, blurring the lines between the role of the company's management and the board. The recent acquisition of the then-board and executive committee – the American e-commerce trade TradeGlobal – cost the company S $ 236 million, but it had to be damaged by $ 185 million just one and a half years later.

The board also recruited then 37-year-old dr Wolfgang Baier as chief executive (International) in 2011 and promoted him to the group's executive director the same year. They also named the chief operating officer of Dr. Sasha Howeur in 2012, when he was 33 years old. They both left in 2016.

A third concern was whether the management team was equipped to integrate and manage new businesses. Based on the disclosures of their profiles at the time of appointment, Dr. Bayer and Dr. Hauer were career consultants with little or no experience with management companies. Several other consultants were also appointed to key management positions.

Thereafter, there was a large turnover of management, both in the years before the appointment of Dr. Bayer, and after his departure. Exchange rules require only disclosure when directors and some key officials are absent, so it is not clear whether this is an indicator of a similar high turnover of employees in the company.

Wolfgang Baier, former CEO of Singpong

Wolfgang Baier, former CEO of SingPost. (Photo: SingPost)


Today, the SynPost board and the management team are not recognized by those years.

The new General Manager of the group took over the post in June 2017, the new CFO group in August 2018, and the new postal services executive and Singapore will take over in April 2019. We hope that there is now a stronger and stable management team, but it will not be easy to turn this ship, and not when Koo was not appointed after Dr Hauer left in 2016, a role that carries a heavy responsibility for optimizing group operations.

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The current executives and the senior manager have the task of spreading the remaining corporate governance issues, looking at over 20 made purchases, improving operations, all while they feel the pressure from shareholders, the inherited legacy with which the new team will have to fight for some time .

These past issues can affect SingPost's everyday activities, if business controls are weakened, including those related to recruitment, induction, training, well-being, supervision and staff assessment-fostering frustration between overburdened and weaker mailers.

SingPost's share price has fallen to about 60 percent of what was just before Dr. Bayer's departure, while dividends were reduced. Also, public confidence was shaken when in recent cases there were huge drawbacks among readers who say they experienced similar problems.

While the current board has taken steps to improve SingPost's corporate governance and set up a new management team, it should ensure that a detailed overview of SingPost's operations is carried out in the light of numerous flaws.

It certainly should not resolve problems by attributing these to seasonal factors or to poor workers without a comprehensive appraisal of complaints.

This overview is even more important with the announcement of the IMDA that it will take firm action against SingPost for any violations of its public postal license applications, that it "takes a serious look at any incident that affects the security, integrity and reliability of public postal services in Singapore, "and its direction that" SingPost must investigate all complaints and feedback raised and take immediate steps to improve its service standards and return it trust the public in their postal services. "

Mac Juen Teen is an associate professor of accounting in the Business School NUS, where he specializes in corporate governance. The views in this article are his personal views.

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