Kuala Belait - Local business development (LBD), business integrity and safety are the three main areas in which improvements are needed for Brunei to achieve sustainable development in the oil and gas industry.

This observation was made by Minister of Energy at the Prime Minister's Department Pehin Datu Singamanteri Colonel (Rtd) Dato Seri Setia (Dr) Awang Haji Mohammad Yasmin bin Haji Umar in a keynote speech at the Brunei Shell Joint Venture Vendor Forum, which took place at the Bridex International Convention Centre yesterday.

Echoing his speech at last year year's Vendor Forum, the minister named the three aforementioned areas as still needing improvement for sustainable development of the country's oil and gas industry.

"To have a sustainable future, our priority must be on developing our local businesses. This is important for the country's social and economic development," he said. "Sustainable development rests on our ability to meet the three main pillars, ie social, economic and environmental goals and objectives."

He stressed the need for businesses to be professionally run and managed, with locals engaged across all sections of the companies doing actual work and not simply appearing as mere figure heads or to serve the purpose of providing a colourful glossary to show that companies are truly local.

"The real task is not just about creating jobs in big numbers, but more importantly providing quality and decent paying jobs in our oil and gas industry with ample opportunities for training and career progression."

The minister highlighted that he has seen success stories during his working visits to some companies in terms of engaging locals as employees, but added that there are still some who are "insincere".

"Please do not just hire so that you have the numbers to show that you are meeting the LBD Directives on employment," he said. "We have a simple rule - we want to see quality jobs made available to locals."

This, he said, is in line with Wawasan Brunei 2035 that wants the country to have well educated and highly skilled people. "It is all about growing our Bruneian human capital. Surely, it is not too much to ask you all to do your part in providing jobs for the locals."

The minister lamented that there are local companies holding contracts worth tens of millions of dollars, but still have a very poor record in regards to career development.

"Please do not forget your responsibility on this," he urged. "If you can't or just simply won't do it, there are others who can and will."

Pehin Dato (Dr) Awang Haji Mohammad Yasmin also went on to share his extreme disappointment with some of the big companies operating in the country that have a poor LBD record.

"International companies are welcome with open arms as long as they contribute to the socio-economic development and conduct themselves in accordance with the laws of the country," he said. "We want you to bring in new technologies, employ and provide our locals with, as I mentioned earlier, real, quality and decent jobs."

He highlighted that there are international companies in Brunei that do contribute to the nation's drive to develop and upgrade the capabilities and expertise of its citizens.

"To them, I thank you," he said, going on to name two of these companies, Schlumberger and Baker Hughes.

"Schlumberger has about 35 locals working in their organisations outside the country and one of them is heading their operation office in Thailand while Baker Hughes has 10 locals working overseas where one is Operations Manager in Malaysia."

This, said the minister, will enable these local employees to gain more experience and skills, and is also indicative of how locals can achieve a standard that is recognised worldwide if given proper training and career development.

"These are companies that Brunei need and welcome wholeheartedly," he added.

Another point mentioned by the minister was 'Ali Babas'-- local companies that are being managed by Bruneians only on paper.

"It is sad to note that the situation still persists," he said. "It is unbelievable how some Bruneians are willing to put their reputations and financial standings at high risk by agreeing to be named owners of some companies in return for some quick commissions or payments.

"These practices are unacceptable to us and place our LBD drives at risk," he continued. "We have now put in place a mechanism in the Brunei Shell Joint Venture's tender process to identify and weed out these unhealthy practices."

The minister implored businesses to realise why the Energy Department wants to have locals genuinely owning and managing the companies, explaining that it is about building local capability.

"How can there be any business integrity for a company when from the onset you are not even honest about whom the real owners are?"

Corruption is another issue related to business integrity, and the minister stressed that it must be dealt with firmly and eradicated.

"We are still hearing news of vendors and service providers getting into trouble with the Anti-Corruption Bureau. This is all due to pure greed. On tenders, we want you to win on your accord based on your company's capability and reliability and not through unfair means."

Monopolistic practice was another business integrity issue the minister touched on, saying, "This is neither good for the country nor for the business community as a whole. We want to create a level playing field for businesses to compete in a healthy way "We cannot have companies seemingly competing against each other when in reality, in terms of ownership, they are one and the same," he continued. "If there is no competition, then the owner of the monopoly can set the price at whatever he wants and control the entire market for that sector.

"We need fair and clean competition to drive the suppliers to provide superior quality products and keep prices at a reasonable level."

The auditing of company accounts was also mentioned, with the minister sharing that he has come to know of a claim that in the Belait District, there is only one auditor doing all the audit business.

"This leads to delays in preparing audited accounts and thus results in the failure to submit the audited accounts and tax returns in time," he said. "There are even companies that have not been audited for more than one or two years.

"I was also informed that audit firms have members or employees who are also in the management team of other companies," continued the minister. "So my question is: what is the role of the Accountant Association on this? Do you not see there is a conflict of interest here?"

Speaking during an interview on the sidelines of the event, the minister expressed his hope for the situation to change, saying, "There are a lot of people who can be employed, with Universiti Brunei Darussalam producing a number of accountants every year.

"We want the companies to be on time with their financial reporting, because this is very important," he added.

Touching on the topic of safety, the minister underlined that the government is currently drafting new rules and regulations that will be enacted under the Work Health and Safety Order 2010.

--Courtesy of Borneo Bulletin