Featured News Temasek's staff pay cuts for FTX losses fail to satisfy Singaporeans

Temasek’s staff pay cuts for FTX losses fail to satisfy Singaporeans

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The perceived lack of consequences for top management and the asymmetry between their compensation adjustments and those of lower-ranking staff added to the public's dissatisfaction

SINGAPORE: Temasek’s announcement that it will cut the team’s compensation that recommended investing in FTX has failed to impress some Singaporeans, who have flooded social media with calls for further action.

The Singapore sovereign wealth fund invested a whopping $275 million into the once highly valued start-up in the digital currency sector. FTX collapsed late last year, and Temasek suffered significant losses as the cryptocurrency exchange company filed for bankruptcy, leading Temasek to write down its hefty investment to zero.

In a rare public announcement yesterday (29 May), Temasek acknowledged the negative impact its investment in FTX has had on its reputation. It said that its team had conducted “extensive due diligence” on FTX, but fraudulent conduct was allegedly hidden from investors.

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While Temasek said there was no misconduct by its investment team, it has decided to initiate compensation cuts to demonstrate collective accountability for the failed investment. The exact amount of the compensation cut, however, has not been disclosed.

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While some observers welcomed the cuts, another segment of Singaporeans remain deeply dissatisfied and have asserted on online forums that while compensation cuts may seem significant, they pale compared to the losses incurred.

While some Singaporeans appeared to accept Temasek’s finding that no misconduct was at play, they have questioned whether negligence or incompetence played a role in the failed investment. Calls have also been made to hold top management accountable for their roles in the investment decision-making process.

The lack of clarity on how staff evaluated FTX as a worthwhile investment has also fueled public scepticism. Many Singaporeans have questioned that the investment into FTX was made despite the absence of an independent board of directors overseeing the cryptocurrency exchange.

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They also raised concerns about past investments, such as Zilingo, and called for a thorough review of the fund’s investment policies.

While Temasek’s announcement mentioned “reduced” compensation, some critics argued that all bonuses should be clawed back to reflect the severity of the loss. Calls for an independent inquiry or an external audit report on previously failed investments were also made.

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Singaporeans online emphasized the need for proper oversight and accountability when managing the country’s finances, urging a change in leadership if necessary. Several commenters online expressed frustration with the current management, stating that individuals responsible for poor investment decisions should be replaced.

The perceived lack of consequences for top management and the asymmetry between their compensation adjustments and those of lower-ranking staff added to the public’s dissatisfaction.

These demands for greater transparency and accountability from the sovereign wealth fund reflect a desire for stronger oversight and a need to restore trust in managing the country’s finances.

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