Doing business and doing justice to governance

 The Supreme Court ruling on the Sri Lanka Insurance Corporation was a much-anticipated event amongst corporate circles, with its verdict likely to set many precedents on how private sector does business.
The Court found that approved procedure had not been followed in the sale and approval of the Insurance Corporation deal. It found irregularities with the ‘assigned’ tender board, the steering committee and lacking proper approvals from the Cabinet of ministers. This translates to a weakness or failure on the part of the system, and that even a company with good intentions can fall victim to such incidents of unprofessional conduct. Nonetheless, the SLIC ruling is viewed as a victory for good governance, and it could give confidence to the investing community that future privatisations or partnerships, would be done according to the law and entirely based on merit.
But what safeguards does an organisation have to protect against malpractice of this nature? On the premise of good governance, perhaps this would be opportunity for business to put in place a system of checks and balances to ensure transparency and protocol which extends beyond mutual trust and understanding. There is no doubt that the Supreme Court ruling would to some effect impact the private sector’s confidence in pursuing any future privatisation or public partnerships. It is then up to the government, should it still wish to consider liberalisation, to ensure stringent process to avoid such embarrassment.
The privatisation of SLIC was recommended by the IMF and the Asian Development Bank as part of a reform programme to improve performance. The court pointed to a hidden agenda. The public sentiment is that this was another victory against corruption perpetrated by the strong arm of business. It has helped to manifest liberalisation as the evil some parties make it out to be. But the battle must not be against prudent policy, but rather against malpractice or corruption. Let us be reminded of SLT, which stand as ample testament of how privatisation could be managed effectively, with incremental benefits to country and society. What we need is to transfer that good practice and procedure to any future privatisation move that is deemed fit for national consumption.
 In the event of future privatisation, the corporate community must be encouraged to consider positively. Examples such as the SLIC judgment must be employed to ensure that proper procedure is adhered to. It is imperative that clear direction and approval is sought from cabinet level.
 In the end it’s all a matter of governance; of practicing the very values we espouse.
A number of operational issues have arisen with the Insurance Corporation back in state hands. What of the service and standards that were put in place during the Distilleries management? What of the operating structures and human resources? Is the public to expect a return to the typical state operation?  The Distilleries management had introduced a number of measures to improve the service and standard of the SLIC operation. From a customer point-of-view, one would hope that the new management would retain some of the best practices that have since, been put in place. It would serve to maintain quality, and it would also serve to hold customer confidence built over the past six years. In any case, the public is a common stakeholder for all.
Let this judgement not be the onset of a witch-hunt on privatisation. Should anyone or party wish to appoint a high powered commission of inquiry to probe past privatisations, let it be done in a prudent and apolitical manner. The public’s interest must be kept at heart in every action, and overturning an agreement sealed thirty years ago would offer no benefit if it impedes the public progress.
Justice must prevail, but it must be done where fit. We also recognise the end of an era – that of Chief Justice, Sarath N. Silva. He would be remembered for the landmark judgments delivered on SLIC, Lanka Marine Services and Water’s Edge, which caused the resignation of a Treasury Secretary and held that a former President abused executive power. Justice must prevail, it is best preserved as independent.