I find the performance of Felda Global Ventures Holdings Bhd (FGV) most perplexing as explained by its chairperson, Mohd Isa Abdul Samad (read, ‘FGV’s success not limited to financial performance, says Isa').

First, he said FGV should not be evaluated based on its financial performance. How did this come about - a business corporation listed on the stocks exchange, but its result is not based on financial performance? There must be a new performance evaluation model that I have not heard of.

If the company has done the right things as highlighted, its value would have been reflected in its profit or share prices. Why talk about FGV engaging in long-term investments, improving existing operations, increasing its non-leased land ownership, and strengthening human capital et cetera, when all these are not able to increase the profit potential and hence the share prices of the company.

I agree sometimes long-term investments or investments with long gestation may temporarily affect short term profit. But if these investments are prudent and with good potential, I am sure shareholders/investors are able to see value in them.

Mohd Isa then bragged about FGV being the biggest in “this and that” as another indicator of “performance”. Seriously, what is the point of FGV being the world largest producer of crude palm oil, the biggest operator of bulk storage, and the biggest Malaysian producers of refined sugar when all these “biggest and largest” are not translated into profits?

Profit is the function of revenue and cost based on efficiency and productivity, not whether the company is the biggest or largest in the industry. I am sure we have heard of dinosaurs that have gone extinct before.

Mohd Isa also talked about certain parties politicising issues which affected the share prices of FGV negatively. But why would rational investors be affected by negative news or allegations that are not true? The share prices should reflect the long term intrinsic value of the company even though there may be temporary volatility due politicking or poor sentiments.

Finally, Mohd Isa talked about corporate social responsibility (CSR) which I think has become fashionable nowadays. CSR is not an obligation but a voluntary sense of responsibility to the society. CSR should not be used as an excuse for a company’s poor performance. CSR should be obliged out of profit. I don’t see the logic of corporations performing CSR when they are not making money.

The profit of a company may be affected by short market fluctuations. These are systemic impacts which affect all companies in the same industry, not just FGV.

The same applies to replanting schedules and other investment decisions. I believe if investment decisions are made prudently and with proper feasibility studies, the value of the company and hence its share prices should go up over time, not down. What do PPB, KLK, IOI and United Plantation have in common which FGV does not? For whatever the reasons, please don’t tell me FGV does more CSR than other companies.