Prime Minister Abdullah Badawi today unveiled a policy handbook to help overhaul government-linked companies which will hold chief executives more accountable for their performances.

The "Transformation Manual" containing policy guidelines and 10 initiatives was launched to a high-level audience including the cabinet and the heads of government-linked companies (GLCs) such as Petronas and Proton Holdings.

"GLCs must reform and transform into high-performing organisations," said Abdullah, emphasising that Malaysia had to speed up efforts to meet its goal of being a developed nation by 2020.

"This will boost the overall performance of the GLCs, produce a powerful demonstration effect for the country's larger private sector and develop new growth prospects in the country."

The 10 initiatives include reviewing and revamping procurement, optimising capital management practices and enhancing operational improvement.

Abdullah also announced an office to help the reform of GLCs, which will ultimately report to the prime minister.

He added that the heads of GLCs, as well as government-linked investment companies, "will be accountable for program results at the own companies."

Shares of GLCs to double in value

Figures released in the handbook estimate that over the next five to seven years, shares of high-performing GLCs could gain RM250 - RM300 billion in value or double from current levels.

The government launched its drive to improve efficiency and competitiveness in GLCs last May in the first of four stages to be implemented over 10 years.

Measures introduced so far include key performance indicators, performance-linked compensation, better governance and some management changes, with board numbers being cut to 10.

Abdullah later told reporters that he anticipated further management changes with the ongoing reformation of GLCs.

"We will expect high performance from them, good governance from them and on the basis of that, I think there will be (changes)," said Abdullah, who refused to name any companies.

The government has also slated state investment company Khazanah Nasional for bigger things, transferring to it billions of dollars' worth of shares held by the finance ministry in some 30 listed companies.

Major GLCs include Malayan Banking, Telekom Malaysia, Malaysia Airlines, energy company Tenaga Nasional, and Sime Darby, which has automotive, manufacturing, property, and oil and gas interests.