CO882-(6-8) — Page 471

PUBLIC RECORD OFFICE

Reference :-

PC.O. 882

8

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

28

then that this gentleman, who has been visiting England, was, while recently there, so heckled and bullied over the affairs of this Company by members of the London Committee, that his final suggestion to them was that they should come out to Singapore and manage this Company themselves, as they seemed to think that no persons other than themselves could do so. Let ne here say that as far back as 1901 this whole Board not once but several times urged and besought the London Committee to send delegates from that body out to Singapore to see on the spot what had been and what was being done, to confer with the Board here on our proposals of what was required and what should be provided for the future, and to decide with us here on the spot on a policy and plan of work for the future, so that we might then have settled schemes on which to start work and go ahead, instead of wasting valuable time and reaching nothing, in playing battledore and shuttlecock between Singapore and London. (Hear, hear.)

Another reason why we on this side all very strongly urged this course in the better interests of the Company, and we pressed this point on the Committee as one of great importance, was that the selection to the office of Managing Director should be governed by the result of the Committee and the Directors' meeting on the spot here, conferring together as to requirements, and on the decision as to what was to be undertaken and done. But the Committee would have none of this. Instead, they demanded from us and by pressure arising out of back door private telegrams that were at once scattered from the various seniors on the Committee to juniors on the Board, they obtained, under recorded protest of all the Directors. what they insisted on being given to them, viz., what may be termed "blind," and carte blanche authority to engage, on any terms, an unknown Managing Director. And instead of first coming out themselves, and afterwards making this appointment and selection depend on the conclusions come to from a conference on the spot between themselves and the Directors, they knew much better, and appointed forthwith and sent out a Managing Director of their own choice at a salary of £4,000 a year, a man absolutely new and strange to the place and to everything and everyone here; and at the same time they enjoined him to politely steer clear "of local experience. Our own nomination to the new office of Managing Director of a gentleman that we all knew and recommended, who knew the place well, and whose well- known business and administrative abilities were of the highest, was disapproved by two leading members of the Committee, who at once set to work in London in opposition to that appointment.

Gentlemen, I think I have given you facts and evidence that prove a good many things;-- how behind the scenes I have tried to get things put right and advanced for this Company; how these efforts have been of no avail in London; how dual control and dual direction exist beyond the possibility of question; and, generally, how the very existence of the London Consulting Committee makes it impossible that wholesome advancement of the Company's position can be accomplished while there exists any of the influence over this Board that the London Committee exercises.

Very gladly would I have kept behind the scenes all that I have said to-day, but if there comes harm or hurt for the time being from what I have said, then I must refer Shareholders again to the Committee, for you cannot get rid of a deep-seated and progressive disease without drastic measures, any more than rotten Governments can be overthrown without revolution, in the course of which some must be sufferers. It has to be done sooner or later, and in our case the disease of dual control has been, making such marked and alarming headway I took the duties of Chairman of this Company that it is imperative it be seen to at dnce. determined to give to it all the hard work that in me lay, aided by the experience and The London Committee knowledge that many years of connection with it had given me. decided that they would not hear me as an individual, nor would they recognise that the Chairman in his own personality can be a factor in improving the Company's position and working All this I would gladly and willingly have fought out behind the scenes with that body. I would have preferred that method of campaigning, but, as they would not have it and as they shut the door to me personally, I have been forced to come out in the open. According to my lights I have worked hard and conscientiously for this Company; appreciation from a public Company is what me rarely gets, and, indeed, never looks for, but I at least feel I am entitled to claim that what this Board under my Chairmanship has succeeded in doing in the way of improving the Company's working and extending its facilities, and this under difficulties that you now may have some measure of-is what none of us need in the least be ashamed of.

DIVIDEND: THE BRIGHT AND GUIDING STAR.

If conclusive or more convincing evidence were wanted that to maintain a high dividend is the one principle und guiding star of the London Committee, and moreover that in their view this must come before efficiency, we have once more had this in cables from the Committee within the past fortnight.

This brings me to the matter of Mr. J. R. Nicholson's report of 9th January, 1904, to which I have made reference. It is a report by your Managing Director made after, and as the result of, a full year's examination and study of the condition, nature, and shortcomings in our appliances, structures, and facilities for berthing steamers, and for working cargo and coal, as these now are, compared with what these, in his opinion, should and must be if we are to hold our own and keep up with the times. I believe you know that Mr. Nicholson by professional training is an engineer, a member of the Institute of Civil Engineers.

MR. NICHOLSON'S REPORT. A $12,000,000 SCHEME.

To briefly summarise this report: It very fully sets forth what works are necessary for needful extensions and improvements, &c., and increased depth all along our wharf frontage. so as to increase the working capacity and the efficiency of this Company; Mr. Nicholecu

29

recommends these, and urges that it is needful to put them in hand as early as possible. The cost of what he recommends he estimates at over twelve million dollars, roundly, a million and a quarter sterling;-he reckons that this expenditure would be spread over about ten years, the outlay in the first four of these being much heavier than in the others.

On receipt of this report by the Directors the first course naturally was that they should study it very carefully and closely, and then decide in their opinion what it was worth. By February 9th, the Directors had made up their minds as to the merits of Mr. Nicholson's report and recommendations, and here is what on that date is recorded in their Minutes as a resolution of every member of the Board: ---

"In the unanimous opinion of the Board all the recommendations put forward by Mr. J. R. Nicholson, Managing Director, in his report dated 9th January, 1904, are necessary for the improvement, development, and extension of the Company's property and facilities, and the Board strongly recommend that they should be taken in hand with the least possible delay."

APPROVED BY LOCAL DIRECTORS.

You must mark that, in thus resolving, the Directors went no further than to express a very decided opinion, and make a strong recommendation. They did not resolve to start these works. The time for resolving on action upon the report had not yet been reached. Not only was there no dissentient nar questioning voice as to the opinion of the Directors on this matter. but in another document settled and approved by the whole Board at the same time, it is recorded as the view of the Directors that the works recommended in Mr. Nicholson's report-

+

Appear to them to be necessary for the improvement and welfare- Singapore as a port, while again the improvement and welfare of the port would seem to depend very considerably on the ability of the Company to give efficiency and facilities of an up-to-date nature in all departments.'

I need merely tell you that, at the very outset Mr. Nicholson's report, to which are attached all relative plans and estimates, was sent home to the London Consulting Committee. Well, the immediately following step in this most seriously important matter was to consider as to the issue of the report to all Shareholders. One view of a majority of the Board of nine persons to this there were two dissentiente was that the very existence of this report had brought us face to face with a situation more important and more serious than any ever faced or ever likely to be faced in the history of the Company-mot a situation and question affecting a select or favoured group of Shareholders, but one affecting, and affecting seriously. every member of the Company down to the smallest holder. It must be kept in mind that the capital of this Company is $3.700,000; besides this we have Debenture loans secured by our property aggregating $1,615,500, and if you put these two sums together you have a totul of $5,315,500.

GRAVE QUESTION OF FINANCE,

MOMENTOUS TO EVERY SHAREHOLDER.

Taking Mr. Nicholson's estimate, for works that he considers to be and recommends as necessary, at approximately twelve and a half million dollar, you are thus faced with the fact that we have to look to a definitely recommended expenditure that exceeds the amount of the Company's capital and debenture loans put together, by no less than seven million odd dollars. Is it possible, in the face of this, to conceive that at least a decided majority of the Directors could do otherwise than declare their conviction that this, above all others, is u feature and a condition in the outlook, that made it imperative that the Shareholders must be at once taken into the full confidence of the Directors, who stand as it were in the position of trustees and managers for the Shareholders? It was not intended to go to the Shareholders and tell them that we had decided on doing the works recommended by Mr. Nicholeon. These cannot in wisdom be undertaken until satisfactory means of financing for them can be seen, but I tell you

that in preparation for the stage of coming to the Shareholders on the final question of undertaking the works, we had already put out inquiry on the matter of finance. What we wanted the Shareholders one and all to know at the outset was the situation with which we as their trustees and managers were faced. That I most decidedly thought was and I still very strongly think is, the bounden and imperative duty of the Directors to do; and I think that they will in a pronounced way fail in their duty if they do not at once openly publish the report in question.

may

DIRECTORS SAY "PUBLISH."

LONDON BAYS "NO-IF IT ENDANGERS A 12 PER CENT. DIVIDEND.'

Well, gentlemen, in our deliberations on this question it was proposed, so as to place Shareholders in Europe at no disadvantage to those on the spot here, that the report in complete form should be issued, to every Shareholder, on March 14th. That date was suggested for two reasons: firstly, it gave time for a sufficient number of copies to get to London for issue there to all Shareholders in Europe on the same date as that on which it would be issued here; and, secondly, it would have permitted of the report being in the hands of Shareholders here in time to express themselves thereon if they so desired at this annual general meeting.

Well, on February 9th, the Directors decided and minuted two gentlemen of the Board lissenting:

"that a printed copy of Mr. Nicholson's report be issued to each member of the Company, both in Singapore and in Europe, on 14th March, 1904."

-

When the London Consulting Committee heard of this they cabled out-on March 10 that they did not think it advisable to issue the report "unless it could be accompanied by