Singtel has awarded an employee a significant bonus just one week after a network outage at its subsidiary, Optus, led to the failure of emergency triple-0 calls, which has been linked to three deaths in Australia. The announcement, made via a filing to the Singapore Stock Exchange (SGX), detailed the grant of 32,198 ordinary shares under the Singtel Performance Share Plan 2012.
The filing, published on the SGX website at 6:58 p.m. local time, stated that the shares were awarded at a price of S$4.26 (approximately $5.01), totaling a remuneration of S$137,163. The identity of the employee receiving the bonus was not disclosed, but the filing was titled “Employee Stock Option/Share Scheme.”
Timing of Bonus Raises Concerns
The timing of the bonus has sparked controversy, particularly as it follows closely on the heels of a press conference held by Optus in Sydney, where the company disclosed the tragic deaths linked to the network failure. Industry analysts have questioned the decision to award such a bonus amid the crisis.
Independent telecommunications consultant Paul Budde remarked that the timing “looks odd,” adding, “Nobody bothered to put a hold on this [employee award]. Again, very poor internal communications/management.”
Thomas Clarke, a corporate governance expert at the University of Technology, Sydney, commented, “It was another indication of how share bonuses (and governance mechanisms generally) are oblivious to service delivery.”
Background and Corporate Structure
Optus, wholly owned by Singapore Telecommunications (Singtel), has a strong operational relationship with its Singaporean parent company. Singtel itself is majority-owned by Temasek, a sovereign wealth fund of the Singapore government. This close connection was underscored when Singtel CEO Yuen Kuan Moon issued an apology on behalf of Optus for the network outage on September 18.
The network failure, which affected emergency calls in South Australia, the Northern Territory, and Western Australia, impacted 480 customers. Optus CEO Stephen Rue confirmed the technical failure, emphasizing the seriousness of the incident and the company’s commitment to cooperating with Australian authorities.
Upcoming Meetings with Government Officials
The controversy surrounding the bonus and the network failure comes ahead of a scheduled meeting on Monday between Communications Minister Anika Wells, Singtel CEO Yuen Kuan Moon, Optus CEO Stephen Rue, and board chair John Arthur. A Singtel spokesperson stated, “Singtel Group CEO Yuen Kuan Moon will be in Sydney [today] for a meeting as a member of the Optus board as it supports management through the triple-0 incident.”
Mr. Rue and Mr. Arthur will join the meeting with Minister Wells to discuss the incident and explore measures to prevent future occurrences. The spokesperson added, “Singtel takes this matter seriously and will extend full cooperation to the Australian government and authorities to address the Optus issue.”
Implications and Future Considerations
The decision to award the bonus, despite the ongoing crisis, highlights potential gaps in corporate governance and communication within Singtel and its subsidiaries. The incident has raised questions about the alignment of performance incentives with service delivery and crisis management.
As Optus and Singtel prepare to meet with government officials, the outcome of these discussions could have significant implications for the company’s operational practices and its relationship with regulatory bodies. The telecommunications sector will be closely watching how Singtel navigates this challenging period and whether it will lead to broader changes in corporate governance and crisis management strategies.
The unfolding situation underscores the importance of aligning corporate incentives with public accountability, particularly in industries where service reliability can have life-or-death consequences.
