Singapore Post (SingPost) has appointed Neo Su Yin as its group chief operating officer (COO) effective Jan 2. The newly created role will see Neo overseeing the group&rsquo s Singapore and international business units and property. Neo will &ldquo take guidance&rdquo from SingPost&rsquo s chairman of the board, Simon Israel, amid &ldquo transitional management arrangements&rdquo .

 

Neo was previously the group&rsquo s Singapore CEO, a role she held from November 2021 to April 2024 before becoming dnata&rsquo s managing director for Singapore from May 2024 to November 2024.

 

&ldquo The board is pleased to welcome Su Yin back to SingPost as our group chief operating officer,&rdquo says Israel. &ldquo She has a proven track record and deep understanding of SingPost' s business and operations. Her appointment greatly strengthens our leadership&rsquo s focus on driving operational performance and excellence &ndash a core foundation for sustainable growth.&rdquo

 

On Dec 22, the group announced that it had sacked its group CEO Vincent Pang, group chief financial officer (CFO) Vincent Yik and Li Yu, the CEO of its international business unit operations. Phang was also asked to step down from SingPost&rsquo s board. The termination comes after the trio were said to have failed in their handling of whistleblowing reports pertaining to SingPost&rsquo s international e-commerce logistics parcels business.

All three sacked executives have said they plan to fight the terminations

 

A &ldquo SIGNIFICANT majority&rdquo of the shipments involved in Singapore Post&rsquo s : S08 +1.92%(SingPost) Parcelgate fiasco were linked to known issues like conflict zones.

 

This was the comeback from the company&rsquo s former group chief executive Vincent Phang and group chief financial officer Vincent Yik on Tuesday (Dec 31) &ndash who, along with Li Yu, head of its international business unit (IBU) &ndash were sacked for being &ldquo grossly negligent&rdquo in their handling of a whistle-blower report and subsequent investigations. 

 

SingPost had earlier found and terminated three managers in the IBU for making manual updates of the &ldquo delivery failure&rdquo status code for parcels it had agreed to deliver even though no delivery attempt was made.

 

Phang and Yik issued their joint statement on New Year&rsquo s Eve in response to SingPost&rsquo s detailed account of its due process leading up to the termination of the trio.

 

The statement said: &ldquo As we had shared in our Dec 22 statement, the management was not part of the investigation following receipt of the whistle-blowing report, in line with the company&rsquo s whistle-blowing policy. We were asked for our views on Mar 11 and Apr 3, 2024, and we responded accordingly based on the facts that were provided to us at that time.&rdquo

 

They added that the &ldquo full facts came to light&rdquo for them only after the external forensics team&rsquo s investigations established the causative correlation on Apr 27, 2024. 

 

&ldquo A significant majority of the shipments in question were linked to destinations where there were known issues &ndash such as conflict zones (for example, Israel). It was therefore important to establish the financial impact prior to communicating with the customer as well as determining any wrongdoing by junior staff members.&rdquo

 

SingPost&rsquo s earlier statements had said the trio were given the opportunity to be heard before the decision was made to fire them.

 

The national postal service provider was responding to queries following the fallout from the announcement of the terminations. 

 

Phang and Yik said the management had agreed with and followed the board&rsquo s instructions after they were briefed on the report and its findings, following the investigations by the external forensics team. A settlement with the customer was concluded. It did not have any material financial impact.

 

All three executives have said they plan to fight the terminations.

There has been intense focus among e-commerce platforms on improving customer experience and costs, especially with delivery

 

JUST days before Christmas, three Singapore Post (SingPost) executives got a rude shock when they were unceremoniously fired by the board for being &ldquo grossly negligent&rdquo in their handling of a whistle-blower report.

 

The three former key management executives &ndash group chief executive Vincent Phang, group chief financial officer Vincent Yik, and chief executive of its international business unit Li Yu &ndash were not directly involved in the allegations raised.

 

However, investigations revealed that three managers in SingPost&rsquo s international e-commerce logistics parcels business had manually updated or approved &ldquo delivery failure&rdquo (DF) status codes for parcels the group had agreed to deliver for one of its largest customers &ndash without supporting documents or delivery attempts.

 

SingPost said this was a breach of its code of conduct, and has since owned up to the e-commerce customer and paid a settlement.

 

As the Parcelgate drama unfolds, it appears the fraud allegedly carried out by these three unnamed managers was with the intention of avoiding contractual penalties.

 

In response to queries from stakeholders, SingPost said in a bourse filing that the three key executives, while not directly involved in the infringements, had made &ldquo serious representations&rdquo to the audit committee investigating the whistle-blower&rsquo s allegations.

 

These included false assertions that there was no evidence of data manipulation and wrongdoing in relation to the manual &ldquo DF&rdquo data entries that the practice of manual &ldquo DF&rdquo data entries was requested by the customer and that the customer was fully aware of the assumptions of the manual &ldquo DF&rdquo data entries.

 

They also allegedly claimed that such action was in line with industry practice.

 

All three of the key executives had earlier rejected the findings that they were &ldquo grossly negligent&rdquo and said they will contest the reasons for the termination of their employment.

 

Attempts to improve customer experience

E-commerce platforms have gone through several competitive cycles, and there has been intense focus on improving customer experience and costs &ndash especially with delivery.

 

Platforms have long obsessed over any variable that could improve customer experience and encourage bigger purchases or higher average order value. From the user interface to policies that favour the customer over the merchant, e-commerce platforms have tried it all. And delivery is one of the key customer touchpoints where market share can be won or lost.

 

Shopee, for instance, offered free shipping at the height of the e-commerce customer grab &ndash a factor that helped it take the largest market share in Singapore and the region, consultancy Momentum Works indicated.

 

Third-party logistics (3PL) players such as SingPost and Ninja Van have jumped on to the e-commerce wave by helping to deliver parcels to customers.

 

But with customers now expecting their e-commerce purchases to reach their doorstep in a day or less, there is significant pressure by platforms using 3PL players to meet that expectation.

 

Also, as volumes grew, e-commerce platforms gained more bargaining power to drive costs down. Coupled with a labour crunch and high costs of operating in a market like Singapore, 3PL players&rsquo would have found their margins squeezed.

 

These margins would have been further squeezed when e-commerce platforms started their own logistics arms to deliver a portion of the parcels themselves.

 

Interestingly, Qoo10&rsquo s logistics arm managed to survive the e-commerce platform&rsquo s demise, and has now rebranded from Qxpress to TracX Logis.

 

There is also intense competition in the 3PL segment, with big names including J& T Express, which recorded revenue of US$0.74 per parcel in South-east Asia in the first half of 2024. This was a drop from US$0.87 per parcel in the first half of 2023, due to a flexible pricing strategy to gain more market share.

 

Underlying the drop in revenue was a drop in cost of goods sold from US$0.71 in the first half of 2023 to US$0.60 in the first half of 2024, which was due to improving operational efficiency and expertise in cross-border shipping.

 

These factors are reflected in SingPost&rsquo s financial results. While SingPost does not break down revenue or cost per parcel, revenue from its e-commerce segments in the international and Singapore business has fallen in the recent results for the first half of FY2025 ended Sep 30.

 

The e-commerce revenue contribution in the international business segment fell 29.1 per cent from S$141.8 million in H1 FY2024 to S$100.5 million in H1 FY2025. In the Singapore business segment, e-commerce revenue contribution fell 10.6 per cent to S$35.5 million in H1 FY2025 from S$39.7 million in H1 FY2024.

 

SingPost also noted the increased competition in the international logistics market in its H1 FY2025 results presentation as well as lower volumes for the e-commerce segment. In the Singapore segment, the fall was attributed to a drop in one-off deliveries.

 

With e-commerce platforms looking to differentiate themselves with their customer experience, it is likely that these pressures will remain on 3PL players.

 

SingPost is not the only 3PL player suffering under these conditions competitors including NinjaVan have also decided to diversify into cold chain logistics to get better margins on the delivery business.

 

In this ongoing operating environment, 3PL players will continue to find their margins squeezed by high labour costs and lower delivery fees.

 

For SingPost, even as the Parcelgate scandal plays out, it is unlikely that e-commerce will provide the revenue to lift its fortunes.

The group confirms that the proposed A$1 billion divestment of its Australia business is expected to proceed

 

IN A response to queries from stakeholders, Singapore Post (SingPost) has released a detailed account of its due process leading up to the recent termination of the group&rsquo s three senior executives.

 

This ensured that the affected executives were given the opportunity to be heard before the board decided to fire them, said the group in a statement on Sunday night (Dec 29).

 

Doing so also emphasised the group&rsquo s &ldquo commitment to upholding high standards of corporate governance and accountability&rdquo , it added.

 

Two phases of the investigation were outlined in SingPost&rsquo s response to stakeholders.

 

Phase 1: IBU staff fired, settlement made

The first phase focused on the e-commerce shipment data falsification which was identified through two whistleblower reports, which prompted the board to take &ldquo decisive action through rigorous internal investigations and the engagement of external advisers&rdquo .

 

SingPost said its investigations determined that the issue was isolated and limited only to a specific customer, and the practices of three staff from its international business unit (IBU) operations.

 

At the conclusion of the investigations arising from the whistleblower reports, the trio was found to have manually keyed in &ldquo delivery failure&rdquo (DF) status codes to falsely indicate that delivery was attempted for a significant number of parcels, but failed.

 

SingPost said all three were provided an opportunity to respond to the allegations of misconduct against them, before they were later terminated following the conclusion of its disciplinary proceedings.

 

While the three former IBU operations staff challenged their terminations, the group said these were eventually withdrawn or not proceeded with.

 

On the same day, SingPost filed a Nov 11 police report against the trio, the group also commenced disciplinary proceedings against its three executives Vincent Yik, Vincent Phang and Li Yu. 

 

Phang was SingPost&rsquo s group chief executive officer at the time, while Yik was group chief financial officer. Yu was chief executive of the IBU.

 

Separately, SingPost said it informed the affected customer of the issue and settled with the customer privately. Terms of the settlement are confidential, maintained the group, though the amount is not deemed to have a material impact on the group&rsquo s financial metrics for the financial years ended March 2024 and ending March 2025.

 

Phase 2: &ldquo Serious misrepresentations&rdquo by management

In the second phase of investigations, SingPost said the key issue centred on governance expectations and proper conduct by its management in the matter.

 

Though SingPost said external investigations contained &ldquo clear evidence substantiating the allegations by the whistleblowers&rdquo , Phang, Yik and Yu were found to have &ldquo made serious misrepresentations concerning the whistleblowers&rsquo allegations&rdquo to the audit committee from Mar 11 to Apr 3, 2024.

 

These included false assertions on the purpose of the manual &ldquo DF&rdquo data entries, as well as claims that the practice of manually keying in &ldquo DF&rdquo data entries were requested by the customer.

 

SingPost said that if the audit committee had relied on, and accepted these misrepresentations, the practice of making false &ldquo DF&rdquo data entries would &ldquo likely have continued&rdquo .

 

Amid the disciplinary proceedings against Phang, Yik and Yu, the group said it also sought and obtained a second opinion on the matter from &ldquo a senior counsel at another leading law firm&rdquo to &ldquo ensure fairness and independence&rdquo .

 

Announcing the three executives&rsquo terminations only after a conclusion had been reached also &ldquo ensured fairness to the parties involved in the disciplinary process&rdquo , said SingPost.

 

Sale of Australia freight business to continue

In both its responses to stakeholders, SingPost reiterated that its proposed divestment of its Australia business to Pacific Equity Partners (PEP) was expected to proceed, as the group continues to search for suitable replacements for the three recently vacated senior roles. 

 

This reaffirmed an earlier report by The Business Times where PEP said the proposed divestment was not affected by Phang, Yik and Yu&rsquo s sudden exits.

 

SingPost&rsquo s board is due to seek shareholder approval for the divestment at an extraordinary meeting which is expected to be held in February 2025.

 

&ldquo The board is working closely with the management team to ensure the successful completion of the proposed divestment,&rdquo said SingPost in its statements to the Securities Investors Association (Singapore) and stakeholders.

 

It also added that the group&rsquo s business operations continue as usual, with leadership succession plans in place.

 

In the interim, SingPost&rsquo s board chairman Simon Israel will provide guidance and oversight to the senior management leadership team.

 

The group intends for the current CFO of its Australia business Isaac Mah to return to Singapore and assume the role of group CFO. SingPost&rsquo s current head for the south district IBU Gan Heng has been appointed as the unit&rsquo s acting CEO.

The group says it will announce a new group chief executive &lsquo in due course&rsquo

 

SINGAPORE Post (SingPost : S08 0%) said its board&rsquo s objective throughout recent investigations into the handling of whistleblowing reports has been to &ldquo act in the best interests of the company and its shareholders by upholding a high level of governance&rdquo .

 

Responding to queries by the Securities Investors Association (Singapore), or Sias, on Sunday (Dec 29) night, the postal services provider said that its internal controls and risk management systems were considered &ldquo adequate&rdquo when it came to addressing risks which SingPost considered relevant and material to its operations and finances.

 

&ldquo However, no system of internal controls, no matter how robust, can provide absolute assurance against deliberate misconduct or fraud,&rdquo said the group.

 

In its separate response to stakeholders, SingPost reiterated that investigations into the whistleblowing matter concluded that the issue was isolated and limited only to its contract with a specific customer and the practices of three former staff from its international business unit (IBU) operations.

 

The group nonetheless told Sias that key findings from its internal investigation report would not be published, as its eventual settlement with the affected customer was deemed to have no material financial impact on the group.

 

When queried by Sias on SingPost&rsquo s update on its working relationship with the affected customer, the group said: &ldquo The contract with the customer was renewed in August 2024, and the salient terms of the renewed contract with the customer were renegotiated taking into account acceptable key performance indicators. The terms of the previous and current contracts with the customer are confidential.&rdquo

 

Search for group CEO continues

The group also addressed concerns raised by Sias over the sale of its Australia business, saying the transaction was not expected to be affected by the termination of its three former key management executives.

 

To recap, SingPost on Dec 22 announced the terminations of Vincent Yik, Vincent Phang and Yu Li over the mishandling of internal investigations regarding a whistleblower&rsquo s report. Phang was SingPost&rsquo s group chief executive officer at the time, while Yik was group chief financial officer. Yu was chief executive of the IBU.

 

In its response to Sias&rsquo queries on how the board would find suitable replacements for these three senior roles, SingPost said it would announce a new group chief executive &ldquo in due course&rdquo .

 

While evaluating the appointment for Phang&rsquo s replacement, the group said it would consider the change in its profile following the divestment of its Australia business, as well as a subsequent need for a review of the group&rsquo s strategy.

 

In the interim, SingPost&rsquo s board chairman Simon Israel will provide guidance and oversight to the senior management leadership team. The group intends for the current chief financial officer of its Australia business, Isaac Mah, to assume the role of group chief financial officer.

 

SingPost&rsquo s current head for the south district of IBU Gan Heng was more recently appointed as the unit&rsquo s acting chief executive officer.

 

Gan joined SingPost&rsquo s Singapore Business Unit in 2021 before joining IBU as the south district leader in September 2024 with a focus on the group&rsquo s subsidiary businesses in South-east Asia.

 

&ldquo Having straddled both the international and local arms of the business, Mr Gan is familiar with the postal and logistics landscape and has worked with many international and local partners,&rdquo said SingPost in responses to both Sias and stakeholders.

SINGAPORE - Investigations into a whistle-blowing matter that led to the termination of the employment of Singapore Post&rsquo s group chief executive and two other senior executives have determined that the issues raised in a whistle-blowing report were isolated.

 

The issues, which involved the falsification of e-commerce shipment data to avoid penalties by three staff of SingPost&rsquo s international business unit, were found to be limited only to its contract with a specific customer, SingPost said on Dec 29.

 

It was responding to questions submitted on Dec 22 by the Securities Investors Association (Singapore), or Sias, on whether the company would be carrying out a groupwide review to ensure that all its other business units are operating in accordance with rules and protocols.

 

The investigations that followed the report confirmed that the three employees at the international business unit had manually keyed in false &ldquo DF&rdquo , or &ldquo delivery failure&rdquo , status codes on parcels for which no attempts at delivery were made, with the intention of avoiding contractual penalties. The three were subsequently fired.

 

SingPost added that the practice of making manual &ldquo DF&rdquo data entries on undelivered parcels had ceased upon the instructions of its audit committee to its management following the investigations.

 

Corrective action was also taken to prevent similar occurrences and address all relevant operational gaps, and will be reviewed by the audit committee for its effectiveness, it said.

 

SingPost told Sias that it received a whistle-blowing report in January. The same report was sent in February to the Infocomm Media Development Authority (IMDA), which has oversight over local postal and parcel deliveries.

 

Subsequent reviews of the allegations in the report led to disciplinary proceedings against the former group CEO, former group chief financial officer and CEO of the international business unit for handling them improperly, thus undermining the investigation process.

 

SingPost said the three senior executives made serious misrepresentations concerning those allegations to the audit committee.

 

It has told Sias that its internal investigation report will not be published.

 

SingPost said its announcement on Dec 22 that it had sacked its group CEO and two senior executives following the investigations was made in accordance with Singapore Exchange listing rules.

 

An account by the board was also released on Dec 29 to address comments and queries from stakeholders and the media.

 

SingPost said its announcements on Dec 22 and 29 also disclosed that an eventual settlement with the affected customer will have no material financial impact on the group. It added that the contract with the affected customer was renewed in August, after terms taking into account acceptable key performance indicators were renegotiated.

 

Singpost did not reveal the terms of the previous and current contracts with the customer, the identity of the customer, and the settlement amount.

 

In reply to The Straits Times&rsquo queries, an IMDA spokesman noted on Dec 23 that the incidents concerned SingPost&rsquo s deliveries of international e-commerce parcels overseas.

 

Quick checks on the internet showed that SingPost&rsquo s international business unit serves e-commerce customers like Lazada, AliExpress and Amazon.

 

These customers use SingPost&rsquo s cross-border delivery and fulfilment solutions to ship products from sellers in China and elsewhere, to buyers in various countries, including Singapore and other South-east Asian markets.