SINGAPORE: Over a five-decade journey that mirrored Singapore’s nation building story, Keppel Corporation has come a long way since it was first founded and its success has benefited the country in many ways, said Prime Minister Lee Hsien Loong.
Speaking as the guest of honour at Keppel’s 50th anniversary dinner on Friday (Aug 3), Mr Lee described the home-grown conglomerate as one that turned adversities into opportunities and was not afraid to break new ground.
“Your success is also Singapore’s success as you contributed to our economic growth and international branding, and uplifted the livelihoods of many Singaporeans.”
While it may have had moments when things went awry, Mr Lee said it is crucial that the company is “resolute in putting things right” – just as Keppel had done following its offshore and marine arm’s shocking involvement in an international corruption scandal.
FROM SMALL SHIP REPAIR YARD TO DIVERSIFIED CONGLOMERATE
Keppel, named after British Navy captain Henry Keppel, was first established in 1968 – a crucial moment in Singapore’s history, said Mr Lee.
Then, Britain had announced the withdrawal of troops from Singapore earlier than expected. There was “great urgency” by the Government to put the facilities that the British would leave behind to economic use and keep tens of thousands of redundant workers to their jobs, he explained.
Keppel Shipyard was thus split off from the Port of Singapore Authority on Aug 3, 1968, as the Singapore Drydocks and Engineering Company before being renamed three weeks later.
That marked the beginning of one of the two anchors in Singapore’s maritime economy, which played a “critical piece” of the Government’s industrialisation plan and lifted the livelihoods of many Singaporeans by creating well-paid jobs, said Mr Lee.
It also helped Singapore to develop its engineering capabilities over the long term, he added.
Over the years, Keppel survived a “notoriously volatile” offshore and marine industry and evolved into the diversified conglomerate it is today.
Apart from the offshore and marine, Keppel’s other core businesses include property, infrastructure and investments. It also has a significant presence in more than 20 countries, with overseas markets accounting for more than half of its total revenue.
Describing Keppel as one of the first Singapore companies to venture abroad with great success, Mr Lee said: “Wherever Keppel’s business takes it in the world, it is seen as a Singapore company and flies the Singapore flag.”
With its roots in Singapore, its far-flung operations are linked back to Singapore and have strengthened the domestic economy. Other Singapore companies have also benefited from Keppel’s expeditions and reputation overseas, while the international exposure has also been valuable for Keppel staff.
With that, Mr Lee said it is “absolutely necessary” for Keppel to go overseas and operate all over the world.
However, it is “equally necessary for Keppel to maintain high standards of integrity and performance, and keep its own operations and culture clean and transparent even when operating in a complicated environment where different norms prevail”, he added.
Mr Lee was referring to Keppel Offshore & Marine being slapped with US$422 million (S$567 million) in fines last year as part of a global resolution reached with criminal authorities in the US, Brazil and Singapore over US$55 million corrupt payments made by a former agent in Brazil.
“We may not be able to convert the rest of the world to Singapore norms, but we must uphold Singapore norms and rules in our system wherever our business may take us in the world.”
Another challenge that Keppel has had to face in recent years is getting young Singaporeans to work in the offshore and marine industry.
On that, Mr Lee urged Keppel to redouble its efforts because “a Singaporean core will always be important for Keppel”.
Mr Lee also described the listed company as a “sterling example of a successful government-linked company (GLC) that is run completely on a commercial basis”.
Even though its largest shareholder is Temasek, its operations and investments are not directed by the Government or Temasek, nor does either have a board seat, said Mr Lee.
“The Keppel Board and management are fully responsible for running the company, and they are accountable to all the company’s shareholders. Of course Keppel enjoys strong support from the Government, just like all other Singapore companies big and small.
“This is a unique governance model for government-linked companies in Singapore, and one that has served Singapore, and the companies, well.”
NAVIGATING FUTURE CHALLENGES
Moving forward, Keppel faces a rapidly-changing world where competition has stiffened, and countries have grown more nationalist and protectionist.
However, Mr Lee said he is confident that Keppel will be able to weather the storm.
“You have a firm foundation of dedicated and competent staff. You have over time established a solid reputation of reliability, which has given you the ability and goodwill to recover from your setbacks and mistakes.
“So as you celebrate your 50th anniversary, I hope that you will remain steadfast to your core values and build on your legacy of excellence so that Keppel and Singapore will continue to shine brightly on the world stage.”