HRD Corp had reduced its exposure to high-risk assets from 21.6% to 13.5% of its total assets under management.
PETALING JAYA: Human Resource Development Corporation (HRD Corp) has recovered RM270.72 million in investment value this year and reduced its exposure to high-risk assets following governance concerns highlighted in the Auditor-General’s Report and Public Accounts Committee (PAC) reports in 2024.
In a written parliamentary reply dated June 30, Human Resources Minister Datuk Seri R. Ramanan said the recovery was achieved through a restructuring exercise and more disciplined portfolio management.
He said HRD Corp had reduced its exposure to high-risk assets from 21.6% to 13.5% of its total assets under management.
According to him, the current exposure is below the organisation’s 15% investment limit, reflecting a more prudent approach to risk management and long-term capital preservation.
“Starting in 2026, HRD Corp successfully restored RM270.72 million in investment value through the implementation of a more disciplined restructuring and portfolio management plan,” he said.
Ramanan said the agency had also continued restructuring its high-risk investment portfolio in line with its investment strategy to safeguard capital and protect the long-term interests of the fund.
To strengthen governance, he said HRD Corp had established a new Investment Panel comprising individuals with extensive expertise in investment, finance and risk management.
“The establishment of this panel is aimed at ensuring that every investment decision is made more carefully and professionally, and is in line with HRD Corp’s investment objectives and policies.
“HRD Corp has established an Internal Investigation Committee with the involvement of the Human Resources Ministry’s Integrity Unit chief,” he added.
The reply was in response to Yeo Bee Yin (PH-Puchong), who sought an update on HRD Corp’s internal forensic audit and the disposal or restructuring of high-risk investment portfolios highlighted in the PAC report.
The issue first came under public scrutiny on July 4, 2024, after the PAC and Auditor-General raised concerns over HRD Corp’s use of employer levy funds for high-risk investments despite the agency not being an investment institution.
The PAC also highlighted governance issues involving the management of unutilised levy funds, property matters including Menara Ikhlas, and HRD Corp’s equity investment management.
The audit covered the period from 2019 to 2023, with HRD Corp subsequently stating that corrective measures had been implemented.
On Feb 6 this year, HRD Corp suspended three senior management officers following findings and recommendations from the PAC, Auditor-General and the Malaysian Anti-Corruption Commission (MACC), involving issues such as unutilised levy management, Menara Ikhlas, equity investments and delays in the RM14 million New Core System project.
Two weeks later, three more senior officers were suspended as part of what HRD Corp described as an intensified governance reset, bringing the total number of suspended officers to six.
Yeo also asked whether legal action would be taken against the suspended officers.
In response, Ramanan said HRD Corp had made positive progress in recovering investments, including obtaining a consent judgment against one party, with the first payment expected at the end of June.
He said investigations involving the six suspended senior officers were still ongoing.
“So far, disciplinary action has been initiated and the process is subject to the outcome of the ongoing investigation,” he said.
Ramanan added that any legal or further action would depend on the final investigation findings and would be carried out in accordance with existing regulations.
