MTR Corporation continued to grow with Raymond Chien at the helm, adding operations worldwide and quadrupling its share price
EDDIE.LEE@SCMP.COM
PUBLISHED : Sunday, 03 January, 2016, 7:43pm
UPDATED : Sunday, 03 January, 2016, 7:43pm
Raymond Chien.
Dr Raymond Chien Kuo-fung stepped down as chairman of the beleaguered MTR Corporation last week, ending his 12-year tenure leading the railway operator.
Under his leadership, the group has continued to grow. The MTR Corp has transformed from a Hong Kong company into a global rail giant. Besides Hong Kong, it operates in Beijing, Shenzhen and Hangzhou. The firm also has operation bases as far as London, Sweden and Australia.
The MTR’s share price has more than quadrupled over the past 12 years, outperforming the benchmark Hang Seng Index.
Frederick Ma Si-hang, who took up the reins of the rail group on the first day of the year, said: “These remarkable achievements are attributed to our former chairman.”
But the group also has a questionable track record when it comes to putting the interests of its passengers first. It has been widely criticised for raising its fares while making huge profit for consecutive years. Frequent service glitches in recent years gave serious cause for concern over possible quality control issues amid its rapid growth.
The latest attack on the firm came in the form of joint denunciation by all parties, including the Hong Kong government, of its construction of a high-speed rail link that was supposed to shorten the travel time from the city to Guangzhou.
READ MORE: Hong Kong taxpayers to bail out MTR for express rail link to Guangzhou
The operator planned to ask taxpayers to pay for the cost overruns of the long-delayed transport link to the mainland.
Under a controversial agreement announced in November last year, the Guangzhou-Shenzhen-Hong Kong Express Rail Link will be completed in the third quarter of 2018, with the cost revised to HK$84.42 billion – HK$880 million less than the corporation’s last estimate.
All these things happened while Chien was holding the top post at the MTR. But he insisted the corporation was prepared to move forward under its new leadership despite these setbacks.
“One can’t improve until one surmounts difficulties along the road,” Chien told media last week, when pressed whether he was concerned about the controversy surrounding the high-speed rail project.
READ MORE: ‘Bulk of high-speed rail link completed’
Defending the MTR, which manages the scheme’s Hong Kong section, against its critics, he blamed “unforeseeable” outside factors such as geological challenges and construction worker shortages for delays and cost overruns.
“We didn’t know there were so many ‘black swans’ in the world,” said Chien.
“I have no regrets about the project,” he said, while admitting there had been insufficient communication between departments within the corporation.
Before the fiasco, the rail operator was managed day-to-day by nine executive directors, led by American CEO Jay Walder. But the majority of the board was made up of government-appointed non-executive directors with no background in railways, including transport minister Professor Anthony Cheung Bing-leung and Chien himself.
READ MORE: Over-budget and behind schedule high-speed rail link to Guangzhou must be completed soon
Some experts said the project’s woes had exposed the weakness at the top and called for board changes to enable the government, as its majority shareholder, to reassert its control over the rail operator. Walder had made an early departure in 2014 after the scandal broke.
But Chien expressed confidence in Ma and the current management team completing the rail link project.
“Ma is capable of solving problems and taking the company forward,” he said.
Chien said he was a firm believer in infrastructure development, adding that the MTR’s network expansion had benefited many run-down areas and new districts across the city.
“Like the West Rail and Tseung Kwan O line, our services are used by many passengers,” Chien said. “Neither of these lines has become a white elephant.”
Chien, an economist by training, said the high-speed rail link could enable Hong Kong to further integrate with the mainland and seek greater access to this growing market, an idea championed by Chien for many years.
As a top adviser to the Hong Kong government, he suggested that more professionals from the mainland be allowed to work in the SAR.
If Hong Kong was to remain the most competitive Chinese territory, “the brightest and best” from the mainland were needed, he said, in the 1990s, before Hong Kong’s return to Chinese sovereignty.
But the former executive councillor warned that the city would have to take the lead with an ethical code in dealing with the mainland to avoid getting “swallowed up” should it lurch down a corrupt path.
“We must ensure that we are the foot that leads China into a new threshold of fair competition,” said Chien, adding that fair competition was the basis on which Hong Kong was founded.
The veteran businessman said last week Hong Kong still had respectable institutions and local heritage. “But the city has to upgrade itself to remain competitive,” he said.
As an entrepreneur active in public service for more than two decades, he did not say whether he would seek another public office after stepping down from the MTR.
http://m.scmp.com/news/hong-kong/economy/article/1897815/outgoing-mtr-chairman-has-no-regrets-over-hong-kongs-railway
