‘PROFIT-SHARING A WIN-WIN SITUATION’
Better benefits may not mean higher spending, says Boustead
THE government’s initiative to increase employees’ compensation to promote productivity growth will not necessarily lead to higher spending for government-linked companies (GLCs).
Boustead Holdings Bhd group managing director Tan Sri Lodin Wok Kamaruddin said it would be a win-win for both employers and employees if the rise in compensation or benefits could be matched by higher productivity.
Lodin said Boustead group was very much in support of the proposal to maximise employees’ productivity, which in turn would be able to enhance the company’s efficiency.
Prime Minister Datuk Seri Najib Razak outlined in the 2018 Budget that Malaysia was set to achieve strong economic growth and equal distribution of wealth among the rakyat.
Najib said GLCs would lead and be an example to the corporate sector with each given a Key Performance Indicator to increase employees’ compensation.
Lodin said Boustead group was actively involved in six sectors, namely plantation, property, finance and investment, pharmaceutical, trading and industrial and heavy industries.
On whether the profit-sharing initiative would affect revenue stream, he said it depended on the company itself.
“For example, in financial services, we always measure services, performance and productivity of the employees through our cost-to-income ratio.
“I think our Affin Group’s costto-income ratio has always been quite high,” he added.
Lodin also supported the government’s proposal on flexible working arrangements to promote work-life balance.
“If we can have a bit more flexibility in terms of working hours for employees, I think that would augur well for the efficiency and productivity of workers,” he said.
Meanwhile, PwC Malaysia tax leader Jagdev Singh said the budget conveyed a bold move in announcing a gradual increase in salaries and allowances for employees of GLCs.
“It also provides more incentives in the form of flexible benefits and arrangements. This is in line with Malaysia’s gradual shift from a developing country to a service-oriented developed economy,” he said.