Better late than sorry

OFTEN the Securities Commission (SC) is blamed for the delay in approving submissions.

The SC usually comes under pressure from politicians to influential businessmen to expedite their applications.

In most cases, if the submissions do not have problems, it would sail through. If the investment bank had gone through the proposal and able to answer all queries from SC, there should not be any delays.

However when there are issues with the submission, it would take months and sometimes years. The SC often probes into the application intensively and questions the advisors until they are satisfied.

In some cases, the company withdraws its submission at the behest of the advisor. In most instances, it is finally proven that the SC was right in drilling down to details.

Recently there were two cases involving corporate exercise of listed companies. The investment bank withdrew their submission when they could not fulfil the answers required.

Remember Edra Global Energy Bhd, the utility arm of 1Malaysia Development Bhd (1MDB) that was seeking a multi-billion listing. It was a high-profile listing of a company linked to the government.

The SC, however, was not satisfied with the submission and subsequently 1MDB withdrew the application. It had alluded that it would seek a re-listing at a later date. Until today, Edra has yet to seek a listing.

Edra is no longer part of 1MDB, which on its own had gone through a restructuring to resolve its financial problems.

Of late, there are some quarters wanting to see the SC speed up on its processing of corporate submissions. This is not a healthy practice.

Many forget that the SC is the guardian of investors and their money in listed companies. It should be left alone to do its job. It’s better to be late in giving approvals than sorry because one bad approval would cause a lot of pain for thousands.