Apologies for the long silence, dear readers. The monthly period of chaos known as ‘production week(s)’ engulfed us recently, but we’re now ready to resume regular service and we plan not to have further disruptions.
Now we would like to bring your attention to the curious case of Richard Ong of Goldman Sachs. Ong, a Malaysian Chinese, was not allowed his promotion to head Goldman’s Beijing joint venture, Goldman Sachs Gao Hua Securities, because he failed a government mandated Chinese-language proficiency exam.
That seems odd. Ong was co-head of investment banking in Asia and headed Goldman’s Singapore office before moving to Beijing. He was clearly well-qualified, and, at the age of 42, also on a rapid ascent up the ranks. Goldman is supposed to be the world’s most profitable investment bank, and enjoys special status in China, since it’s one of only two foreign brokerages with management control over its JVs here (the other is UBS). According to the FT, many exemptions have been given in the past to foreign executives whose Chinese wasn’t up to scratch.
So what gives? Why wasn’t one of the most powerful investment banks in the world allowed to name its candidate to head an important division? Why was it instead embarrassed publicly, having its choice blocked by a technicality that showed the candidate was incompetent in the language of the host country?
Maybe it was office politics. Zha Xiangyang, the Goldman Gao Hua’s former deputy CEO, was elevated to the top job. Maybe it was, as the foreign press suggest, a case of the government enforcing its Chinese-language proficiency rules.
But can we glean a clue by examining Richard Ong’s resume? According to the FT again, Ong was “instrumental” in Singapore government investment vehicle Temasek’s purchase of ousted Thai PM Thaksin Shinawatra’s Shin Corp last year. But just how instrumental was he? The Nation, a Thai paper, noted that Richard’s brother, Charles Ong, is Temasek’s head of overseas investment strategy and “right-hand man” to Temasek chief Ho Ching. According to Goldman’s website, its Singapore office counts Temasek as a “key client”.
The Temasek-Shin Corp deal went through, but triggered a series of events that led to a military coup against Thaksin’s government and an US$820 million paper loss for Temasek at one point. Because Temasek is seen as a proxy of Singapore’s government (although ostensibly independent), with close links to the ruling People’s Action Party (Ho Ching is Prime Minister Lee Hsien Loong’s wife), the purchase of Shin Corp caused alarm in Thailand. Thais saw the deal as Singapore’s government getting too close for comfort.
China is now planning a foreign exchange investment vehicle, which it said is taking some cues from Temasek. But maybe Beijing, after noting Thaksin’s political demise and the extreme volatility that accompanied Temasek’s deal, thought it unwise to have a key Temasek adviser so close at hand in the capital? There’s been no word on Richard Ong’s next posting that we could find.