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Of course... is a must to look at the past but don't forget to put more time on current and future. Whatever over is over.

No point to waste too much energy on the history and blame each other.

how can the past be disconnected from the present if the supposedly examply past performance is used to judged current performance and current performance is at least partly the result of past performance.
i don't understand why jeff considered it witch-hunting.

JEFF OOI says: Proton manifests like the predicament of winning a battle or winning a war often faced by the generals. In today's Proton, the war is to determine its ongoing business success, and the battle is to fight ghosts and dead horses of the past 20 years. We would want Proton win the war. Clearing the current stockpile and liquidating it into hard cash is one urgent step to winning the war. And of course, an easier analogy is to not drive staring always onto the rearview mirror.

if there was a problem with governance, it was the faukt of the board of directors as much as the then management. even if the directors were sleeping as required by the political atmosphere then, they still can't be excuse for being spineless, borless, principleless ali-babas.
if the report enable proton to learn from its past mistakes and to become more transparent and efficient now and in the future, why not?

A justifiable witch hunt thats what I feel but it reeks of political agenda due to the timing of this .
Proton needs to buck up which is easier said than done due to the 'baggage' of vendors that is a list of who is who !
I guess it will not lead to much change and we will go back to maybe a change of who is who's vendors !
Even a Carlos Ghosh will fail if there is no commitment to change from the government who is the biggest shareholder.
It took 10 years notice to Proton to be competitive and still it is not maybe another 10 more years will not be enough by which Proton will be another 'Balck hole' that will just suck away money relentlessly while the vendors enjoy their fruits of industrialisation !

Dictionary definition for
witch-hunt : Searching out and harassing dissenters.

Sometime witch-hunt is neccessary to make stubborn (ahem) people withdraw from the scene.

I share lsk's sentiment.

It should not be deemed a witch hunt because it is likely to affect dear TM. And it is not just Proton that can learn from this report. The non-executive directors of any company should realise that they simply cannot sit there and accept management's words as gospel. They do not have to be technical and financial wizards. It is more important that they exercise good judgement and question executive management if certain things stick out like a sore thumb.

Since the PWC report mentions MV Agusta, it is an opportune moment to consider some of the signals that the Proton board should have looked into more deeply.

A visit to this Italian company’s website (www.mvagusta.it) will provide a good insight into the company’s history and of course the glitz and glamour surrounding today’s products by this outfit.

MV Agusta started life as an airplane manufacturer and switched to motorcyles after the death of the founder in the 1927. It became a racing legend in the boom of the 50's but the business ran into severe difficulties in the mid 70's and the racing activity was curtailed. Sadly, the industrial chapter of the original MV Agusta came to a close around 1986 with the sale of all its plant, prototypes, bodies and engines to an Italian-American entity.

In 1992 the Castiglioni family secured exclusive ownership over the famous trademark but it was only in April, 1999, that the F4 Gold Series was unveiled on the Monza track to the delight of motorcycle lovers all over the world.

What the website, understandably, does not reveal is that despite the brand’s glorious past and resurrection by the Castiglioni family, the company that Proton invested in was in serious financial difficulties. So bad that receivership proceedings had in fact begun for the company on 14 November, 2002. In mid-November 2004, MV Agusta issued a press release to announce that the Varese District Court has ruled that receivership proceedings are to be terminated given that the company has shown it is able to meet its commitments with an impending capital increase of Euro 70,000,000 before 31 December, 2004. The white knight that Claudio Castiglioni found was Proton. If one wonders why Proton had paid Euro 70 million for a company that might otherwise have gone under and thus be worth a lot less to the Castiglioni family, the answer may well lie in the fact that this was the sum needed to take MV Agusta out of the receivership proceedings. Justification for goodwill is always a dicey business and, invariably, the parties will say that the deal was at arms length on a willing buyer-willing seller basis. In the Proton/MV Agusta deal, it was probably a “fixed” sum – the proverbial “get out of jail” card.

Whatever the basis was for the Euro 70 million, the RM367.6 million questions are:

Why did Proton buy into MV Agusta? What was it that MV Agusta could have delivered to Proton that Mitsubishi did not or the Lotus group could not provide? It must be very special indeed if Tengku Mahaleel still believes it was a good buy for RM367.6 million. So what was it?

What were the factors that had caused MV Agusta to be in protracted financial difficulties so much so that receivership had begun two years before the purchase by Proton and the proceedings were stopped just a month before Proton pumped in the money?

Did Proton and its financial and other advisers pause to reflect whether the business model of MV Agusta may be inherently unsound? Was there a remodeling plan or was it all down to dear Claudio to get things right provided the cheques kept coming?

Proton itself was facing so many difficulties at home after 20 years in the car business. What made it believe that it could solve the woes of MV Agusta, a business it has no knowledge of?

Did the Board of Proton believe that the first Euro 70 million was all that was needed or were they fully aware that further injections of cash will be needed? If that was indeed the case, why did they walk away so soon after Tengku Mahaleel’s departure?

Surely there must have been an expectation of profitability. What were the projected numbers to justify the purchase?

Why was Proton unable to get any value for the goodwill in the MV Agusta brand? While Euro 70 million may have been warranted as part of the rescue package to get the Italian Court’s approval to remove MV Agusta from receivership proceedings, it must surely be fair to say that the value for the brand is worth considerably more than Euro 1. So why was the Proton Board after the departure of Tengku Mahaleel so quick to cut and run?

Did the fact that Proton will be rid of the contingent liability of about RM900 million in the event of MV Agusta falling into bankruptcy drive the Board to approve the fire sale?

If there is no such thing as 'scrutinizing' the past, the previous CEO will loudly proclaim that:-

1) Current Proton administration is sux, and the much bashed previous board was much better because they were the one who brought lots of profits. And now, look at the pile of Proton new cars which should be blaimed on the current board of directors.

Something must be straightened out, and this is one the ways to do it.

Why need to worry about previous CEO's disclosure? Is the future more important or the past is more important?

I would say both. It is important to clean everything out of the closet and not just doing a half-ass job.

Quote:
"PricewaterhouseCoopers report that cited the national car manufacturer's poor corporate governance 1996 until late 2005." unquote.

Poor corporate governance is one thng, but I would like to ask Azlan:

1. Was a "due diligence" conducted before Proton bought MV Augusta? What was the situation then?

2. Was a "due diligence" conducted by Proton before they sell MV Augusta to the new buyer at Euro 1.00? In case the new buyer "could not" afford the price offered and means to pay. Don't take for granted the value offered but the processes must be diligently executed, that the issue here.

3. Which accounting firm involved in the processes of 1 and 2., on behalf of Proton? Hopefully this is not the case of "it takes a thief to catch a thief".

Over to you Mr Accountant MAH cum Chairman of Proton.

Apart from adopting new proactive governance and best practices in management styles’ “Proton's problem still lies deep in their inability to come up with any new products.” So will this imported Mitsubishi 380 (Perdana replacent?) somewhat help brake Proton's woes? With proper pricing it can capture back some of the "big car" market apart from its monopoly in the government sector? Check the details from
http://powerpresent.blogspot.com/2006/08/proton-mitsubishi-380-save-proton.html

I would put the blame squarely on Tun Dr Mahathir.
He allowed this to happen by bypassing the board and deal direct with the CEO.
In his his haste, the Tun has been known to bulldoze his decisions. The Proton board was reduced to only a rubberstamp and the CEO was more powerful than all the board members combined!
Of course Proton is not the only project that suffers from lack of corporate governance. The twin towers, the LRT's, Langkawi, Petronas, the IPP's have all huge numbers of skeletons in their cupboards.
I'm sure the present government may have been tempted to expose all these. However, the snag is that many in the present government were parties to decisions by the former PM (although grudgingly) and secondly, the repercussion from the expose may be detrimental to the country.
LJ