Kuala lumpur: Lembaga Tabung Haji (TH) needs to strengthen its governance structure by ensuring its board of directors comprises individuals with relevant technical expertise to safeguard depositors' funds effectively, said an analyst.
According to BERNAMA News Agency, Chairman of the International Development Committee at the Malaysian Financial Planning Council, Anuar Shuib, emphasized that board members should have a thorough understanding of the Tabung Haji Act 1995 (Act 535) to ensure that the institution remains fully compliant with legal and regulatory requirements. He highlighted the necessity for the board to possess strong financial and Syariah expertise, particularly in overseeing TH's investment activities and ensuring adherence to Islamic principles.
Anuar noted the importance of having board members who understand investments and money management, given that the funds will be invested. He discussed these points on Bernama TV's The Nation programme, where the topic 'TH Royal Commission of Inquiry (RCI): Can Financial Trust Be Fully Restored?' was explored. Anuar also pointed out that TH's board must grasp the institution's fundamental purpose, which is to facilitate Muslims in performing the Haj, stressing that TH's mandate and characteristics are distinct from conventional commercial institutions.
In terms of investment governance, Anuar advised that TH conduct comprehensive due diligence and pre-investment assessments before committing funds. This includes ensuring that assets are not acquired above their prevailing market value. He acknowledged that while investment activities involve risks, these risks must be assessed to determine if they offer sufficient value to the institution.
Drawing comparisons with other major institutional funds like the Employees Provident Fund (EPF), Anuar suggested that clear internal policies, including appropriate separation between teams handling domestic and international investments, could help prevent undue influence and maintain operational integrity. He also supported proposals to place TH's investment activities under the oversight of the Securities Commission Malaysia (SC) through the Capital Markets and Services Act 2007, which could provide additional accountability and strengthen governance.