Singapore Post Limited Looks to Close An Unhappy Chapter And Seeks A Fresh Start

Singapore Post Limited  (SGX: S08) made two key announcements yesterday.

The first announcement seeks to close out an unhappy chapter in the logistics and mail services provider’s story. The second one opens a new chapter.

Crisis of confidence

In late 2015, a crisis of confidence erupted at Singapore Post over the surprise resignation of its chief executive, Dr. Wolfgang Baier. Questions from investors about the company’s corporate governance also started to be raised.

Singapore Post’s chairman Simon Israel, who took on the position in May 2016, acknowledged the unhappy incidents during the company’s annual general meeting held in July. Israel noted:

“At the last AGM, a number of important governance questions were put to the Board which unfortunately were not answered fully and may have raised further concerns. SingPost’s reputation has since suffered from a very public crisis surrounding our Board governance.

We have seen the resignation of the Group CEO, a Special Audit, a Corporate Governance Review and resignations from the Board. Our share price reflects this.”

As Israel mentioned, a special audit on Singapore Post was conducted. The audit report’s recommendations were accepted by the company and implemented.

But to go a step further, stock market operator and regulator, the Singapore Exchange Limited (SGX: S68), asked Singapore Post to obtain an independent confirmation that the recommendations have been implemented.

Yesterday, Singapore Post announced that the Singapore-based law firm, Lee & Lee, had given written confirmation that the policies implemented by the company had adequately addressed the special audit report’s recommendations and the issues that were identified. Lee & Lee is the law firm hired by Singapore Post to conduct the independent confirmation that was requested by Singapore Exchange.

With the announcement, Singapore Post might be looking to close out a difficult chapter in its story.

A new beginning

Israel also mentioned during Singapore Post’s last AGM that Dr Baier could have left due to management problems within the company. He said:

“The [Corporate Governance] Review suggested that more could be done at the Board level to recognise and distinguish between the Board’s stewardship role and the role of the Group CEO and management in executing the Company’s strategy. I think we can assume that this may have influenced Dr Baier’s decision.”

In its latest earnings briefing, Singapore Post confirmed that it was going to hire a new chief executive before the end of this year.

This is where the second announcement comes in. Singapore Post reported that it has elected Paul William Coutts as its new chief executive. As part of the announcement, Israel said:

“The SingPost Board is delighted to announce Paul’s appointment as Group CEO. Given his seniority and the experience he brings from an extensive logistics and postal career including global leadership roles, Paul is well positioned to provide overall leadership to the transformation of the Group, integrate SingPost’s eCommerce logistics platforms and build out a globally competitive business.”

Singapore Post had been without a chief executive for little over a year. With the appointment of Coutts, Singapore Post might be looking to put the past behind it and have a fresh start.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Singapore Exchange. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.