SingPost sackings: A timeline of what we know so far
A general view of the Singapore Post Regional eCommerce Logistics Hub in Singapore on Nov 1, 2016. (File photo: AFP/Roslan Rahman)
SINGAPORE: Singapore Post's board responded late on Sunday (Dec 29) to questions from stakeholders about its decision to sack three top executives at the same time, saying it was "carefully considered".
In a Singapore Exchange filing, chairman Simon Israel said: "The termination of senior management was a carefully considered decision by the board, based on established facts and supported by legal advice, including a second independent opinion from senior counsel of another law firm.
"This decision reflects the board's unwavering commitment to governance principles, prioritising what is right – even when it is more challenging in the short term – in the best interests of the company."
SingPost announced on Dec 22 the termination of the employment of its group chief executive officer Vincent Phang, its group chief financial officer Vincent Yik and the chief executive of the company's international business unit Li Yu over their mishandling of whistleblowing reports.
Following the news, the company's share price dropped by nearly 11 per cent the following day.
Experts said the sacking of three top executives at the same time was "unprecedented" for a Singapore firm.
The SingPost board on Sunday published a detailed account of the proceedings and said the announcement was to address comments and queries from stakeholders surrounding the firing of Mr Phang, Mr Yik and Mr Yu.
"In particular, the response … details the investigation and disciplinary process leading up to the terminations, whereby appropriate diligence was undertaken and the opportunity to be heard was given to the affected parties," said SingPost.
The firm said it took "decisive action through rigorous internal investigations" and the engagement of external advisers.
These investigations were closely supervised by its audit committee and were conducted in two phases.
PHASE ONE
The first phase related to the practice within the international business unit operations (IBU Ops).
This involved manually keying in the delivery failure (DF) status code for a significant number of parcels that SingPost had agreed to deliver.
This falsely indicated that the delivery had been attempted but had failed.
The allegation was that this was done to avoid the payment of certain contractual penalties to the customer.
A whistleblowing report was made, but there was "no public disclosure" at this stage as the allegations had yet to be substantiated pending investigations, said SingPost.
These internal investigations were carried out by its group internal audit (GIA), and the practice was substantiated.
The internal audit unit further outlined that the company was liable to pay contractual penalties for not meeting service level requirements and for false data entries.
But representations made by management contradicted the findings of the GIA, and the audit committee engaged external legal counsel and a forensics service provider to "independently assist with the review" and advise on the matters.
Following this, the practice of manual data entries to avoid paying penalties to the customer was confirmed.
"The company then commenced disciplinary proceedings against three staff from IBU Ops who were, during the course of these proceedings, provided with an opportunity to respond to the allegations of misconduct against them in accordance with the company's disciplinary policy," said SingPost.
Their employment was terminated after the conclusion of these proceedings.
These managers submitted claims against SingPost to challenge the termination, but they were eventually withdrawn or not proceeded with.
The company then filed a police report against them.
The board then instructed management to disclose what happened to the customer. A settlement was reached – although the terms are confidential.
"At this juncture, the company's investigations had determined that the issue was isolated and limited only to the contract with the specific customer and the practices of the three former staff from IBU Ops," said SingPost.
PHASE TWO
The company then looked at management's conduct in the handling of investigations into the whistleblowing reports.
They were not directly involved in the allegations raised in the whistleblowing reports.
SingPost also looked at the renewal of the affected customer agreement in 2023.
"The key issue here centred around governance expectations and proper conduct by management. The same external law firm was also engaged to review management's conduct in the matter," said the company.
In the course of these investigations it was found that although Mr Phang, Mr Yik and Mr Yu were provided with the reports and findings, as well as concerns raised by GIA, they made "serious misrepresentations" about the allegations.
This was despite "clear evidence" substantiating the allegations.
These false assertions include that there was "no evidence of data manipulation and wrongdoing" in relation to the manual data entries.
They also claimed there was no evidence of falsification to avoid paying penalties, and that the manual data entries were not to avoid such penalties.
