Optus CEO’s resignation triggers debate on accountability among Singaporean and foreign executives

SINGAPORE — The recent wave of outages in Singapore, impacting essential services such as banks, public transport, and hospitals, has triggered a comparative analysis of crisis responses and accountablity.

The discussion gained momentum following the resignation of the CEO of Optus, Australia’s second-largest telecom provider, in the aftermath of a widespread outage on 8 November.

Optus, a wholly-owned subsidiary of the Singaporean telecommunications company Singtel, faced a prior shutdown of mobile phone and internet services.

The interruption resulted in millions of customers and businesses being severed from services, creating a chain of disturbances that required almost 14 hours to resolve.

On Monday (13 Nov), a spokesperson confirmed that the outage resulted from changes to routing information following a routine software upgrade at 4:05 am on Wednesday.

Following the incident, Ms. Kelly Bayer Rosmarin, the CEO of Optus, has stepped down. During this period, Michael Venter, Optus’ chief financial officer, will step into the CEO role temporarily.

Furthermore, Singtel has verified that the company is commencing a worldwide search for a fitting replacement.

Differing views emerge on Optus CEO’s resignation: a snapshot of online opinions

As news of the CEO’s resignation spread across online platforms, netizens expressed a range of opinions, highlighting contrasting views on leadership accountability between Singaporean and foreign company CEOs.

Most online commentators approved of Optus’s CEO’s resignation, viewing it as an act of “taking full responsibility” for the outage.

One user commented, “Everywhere else, leaders walk away in shame after a major failure. (In Singapore), they double down, cling on like a wart, and pay themselves more bonuses.”

Some even call local institutions to “learn from the Australian.”

Furthermore, certain users believe Singtel is taking the appropriate action. “DBS should learn from them,” remarked the user.

The reference to DBS Bank follows the Monetary Authority of Singapore (MAS) statement released on 1 November, announcing a six-month moratorium on non-essential IT changes for the bank in response to repeated and prolonged disruptions in its digital banking services this year.

This suspension includes restrictions on acquiring new business ventures and reducing the size of branch and ATM networks within Singapore.

These measures were initiated following a directive issued by MAS in April 2023, instructing DBS Bank to undergo an independent third-party review of its digital banking services.

In addition to the IT changes freeze, MAS has instructed DBS Bank not to decrease the size of its branch and ATM networks to ensure customers have alternative channels during disruptions.

These directions will remain in effect until MAS is satisfied with the progress of the bank’s remediation plan.

This action comes in the wake of a significant service disruption at DBS on 14 October, during which online banking and payment services encountered substantial outages. Customers also encountered challenges in withdrawing cash from ATMs.

On 20 October, there was a brief disruption to its services which was due to a cooling issue at a data centre which implicated various other companies.

Previously, the bank faced a significant 6½-hour service interruption on 5 May due to human error, and a prolonged 12-hour disruption in March attributed to software bugs.

Acknowledging the string of disruptions experienced by the bank throughout the year, the DBS CEO, in a statement for the bank’s third-quarter results, emphasized the commitment to implementing the comprehensive set of measures recently announced.

“We will also dedicate ourselves to executing the comprehensive set of measures we recently announced to address the series of digital disruptions, for which we are truly sorry. ”

“We are committed to strengthening our technology resilience and ensuring customer service reliability, ” he said.

Not convinced of Optus CEO’s decision to resign

Amidst the supportive comments, a contrasting opinion emerged. One user expressed skepticism about the Optus CEO’s decision to resign, stating, ‘I am not convinced that this is a great decision, but I guess someone had to pay the price and feed the wolves baying for blood.’

Mak Yuen Teen, an accounting professor at the National University of Singapore, offered a nuanced perspective in a recent LinkedIn post.

He wrote, ‘Under normal circumstances, I would say she’s the CEO and should take responsibility and resign. But she’s the CEO of a wholly-owned subsidiary, and I would also be interested in how decision-making works between the parent and the subsidiary, the power dynamics, and how Optus is governed. Not that she has no accountability, of course. I think rules should require company groups to make better disclosures of the governance of their subsidiaries and group boards need to carefully consider how they will govern their subsidiaries.”

“In 2015, my good friend Chris Bennett and I released a report on governance of company groups, and we’ve been running programs on this topic in Malaysia for several years. But I think it’s still a topic that parent boards don’t spend enough time on (except maybe FIs). So I will not make a judgement as quickly as for a case of a group CEO or CEO of an independent listed company.”

An Australian media outlet recently revealed that the extensive 16-hour disruption of Optus services was purportedly linked to a network operated by Singapore Telecom (Singtel), which coincidentally happens to be the same network used by Optus for its service provision.

According to Channelnews, citing an insider claiming to be a senior executive from a company closely associated with Optus, the network was under the management of Singtel at the time of the crash.

The source went on to suggest that senior Optus network executives, including CEO Kelly Bayer Rosmarin, ” took all the heat over the crash to protect her Singapore master”.

The Australian media outlet emphasized that Optus has refrained from providing a clear answer despite repeated inquiries regarding who was managing the network during the disruption—whether it was Optus itself or Singtel.

ChannelNews comprehends that Singtel Optus ConnectPlus ILC, a point-to-point international leased line service for data communication traffic, is overseen by Singtel but distributed under Optus management.

As the discussion unfolds, the incident encourages a broader examination of crisis management practices, highlighting the need for improved governance and transparency not only within Optus but across Singapore’s corporate landscape, especially regarding public accountability standards in institutions.