Hong Kong MTR

Experts urge MTR board changes

Management and transport specialists say high-speed line's woes expose weakness at the top and firm's unclear mission as minister vows reform

PUBLISHED : Wednesday, 07 May, 2014, 3:30am
UPDATED : Wednesday, 07 May, 2014, 7:48am

Reforming the board and clarifying the mission of the MTR Corporation will help the government reassert control over the rail company after a delay to the high-speed rail link exposed its weak oversight, transport and management experts say.

The experts suggested the government decentralise MTR's decision-making process, appoint rail experts as board members rather than "amateurs" and clarify the company's purpose.

The comments came after transport minister Professor Anthony Cheung Bing-leung's pledge on Monday to reform the corporation. Cheung apologised for the government's failure to monitor the MTR more closely in the wake of a public outcry over news that the HK$66.9 billion high-speed link to Guangzhou would be two years late.

The company is managed day-to-day by nine executive directors, led by American CEO Jay Walder. But the majority of the board is made up of government-appointed non-executive directors with no background in railways, including Cheung, chairman Dr Raymond Chien Kuo-fung, Jockey Club chief Brian Stevenson, financial services minister Professor Chan Ka-keung and lawmakers Abraham Razack and Ng Leung-sing.

Polytechnic University transport expert Dr Hung Wing-tat advised giving individual board members an enhanced role.

He suggested the reforms take their cue from the structure of KCR, the rail operator that merged with the MTR in 2007. Each KCR director used to chair one of its committees. "In that way, the power would not be only in the hands of a few," he said.

By contrast, the MTR board was kept in the dark when projects director Chew Tai-chong discovered that measures to mitigate difficulties the scheme was experiencing would not help recover the delay.

Professor Danny Lam Wai-fung, a University of Hong Kong specialist in public-sector governance, said the MTR - a publicly traded company of which the government owns 77 per cent - was experiencing problems common in government-led bodies.

For example, the government would appoint board members with a range of backgrounds, while government officials would tend to take a passive role in board discussions.

"The easiest way to reassert government control is to get rid of amateurism [among directors] and appoint a more assertive chairman … it would also make a big difference if officials on the board took their role more seriously," Lam added.

A government report showed that the Highways Department, which is supervising the project, received a work schedule from the MTR only this month, six months after it was requested.

Hung said the 13-strong team overseeing the link for the department should have asked more in-depth questions and checked the MTR's progress reports.

Professor Carlos Lo Wing-hung, a Polytechnic University management expert, said the real issue was the corporation's unclear mission. "Should it be serving as a government instrument to work on public well-being or remaining a commercial entity? If the government wants more control … it should be clearly stated that the company serves a strong public mission," he said.

But board member Ng Leung-sing warned that big changes could undermine staff morale and disrupt railway projects.