By P.R. VENKAT
SINGAPORE -- Singapore's finance minister said state-owned investment company Temasek Holdings Pte. Ltd.'s chief executive would ideally be Singaporean, but the government won't interfere in nor restrict Temasek's decision in the selection process.
"The question of whether the CEO of Temasek should be a Singaporean is not a trivial one; it is one which cabinet considered very carefully and debated on before arriving at a decision," Tharman Shanmugaratnam told lawmakers in Parliament.
"Ideally, we should have a Singaporean as the CEO; that's the ideal and everything else being equal and you look at two candidates who are equally suitable for the job, I think we should prefer to have a Singaporean," he said. "The ideal is not always possible. What is critical is that the board remains in the control of Singaporeans."
Mr. Tharman stressed that the investment company is independent from government interference and that the government prefers not to put restrictions on Temasek in its CEO search.
"The government does not directly manage the process of chief executive succession. To do so would make the appointment of the chief executive a political decision, which it must never be," Mr. Tharman said.
In July, Temasek said it and former CEO-designate Charles "Chip" Goodyear, a U.S.-born executive who was formerly chief of mining giant BHP Billiton Ltd., mutually agreed to part ways, citing differences on "certain strategic issues."
A person familiar with the situation said at the time that Mr. Goodyear's proposals for the firm's new strategic direction were considered too risky by some, and that he also planned some changes to the senior management that weren't well-received by Temasek's board.
Temasek CEO Ho Ching said in July that Mr. Goodyear's departure was "mutual and amicable."
The finance minister said Temasek's leadership remains strong, at both the CEO and board level. "They have enabled Temasek to sustain its generally superior overall investment performance over the years," he said.
Temasek suffered losses on its investments due to the global slowdown and financial crisis. Ms. Ho said late last month that Temasek's portfolio fell more than S$40 billion (US$27.54 billion) at the end of March from a year earlier. The company manages a portfolio valued at S$127 billion.
Mr. Tharman said Temasek had done "rather well" compared with other companies and that there was no "push factor" for the current CEO to step down. "As shareholder of Temasek, the government has a clear interest in Temasek continuing to have strong leadership," he said.
Write to P.R. Venkat at venkat.pr@dowjones.com
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