From legacy to launch: Francis Yeoh and Yeoh Pei Xien on family unity and YTL’s next‑gen ventures

[SINGAPORE] Thinking outside the box, positioning capable next-gen leaders, preserving family unity through a shared trust and maintaining core values – that’s what YTL Corporation’s succession and legacy planning looks like.

Francis Yeoh, executive chairman of the Malaysian multinational conglomerate and eldest of seven children of YTL founder Yeoh Tiong Lay, said: “I expect the whole group to think out of the box and ahead of the curve in technology.”

He was speaking in a fireside chat with his niece Yeoh Pei Xien, vice-president of strategy and transformation at YTL Hotels at The BTLuxe Edit – Future:Legacy symposium last Wednesday (Oct 28).

At the event held in collaboration with Schroders Wealth Management, he said that as a business founded on construction, the group always had to anticipate what was coming next. “Can technology come and surprise us and then wipe us out?”

So the group, having lived in “an old world” before, had to “marinate” itself in a digital one.

Today, its vast businesses include water and sewerage services, telecommunications, data centres and digital banking, on top of construction, cement, transportation and hotels.

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Through YTL Power, its Bursa Malaysia-listed subsidiary, YTL has a strategic partnership with US tech giant Nvidia Corp to develop a RM10 billion (S$3 billion) artificial intelligence infrastructure project powered by green energy in Malaysia.

Last year, it also launched Malaysia’s first home-grown large language model focused on developing sovereign AI capabilities.

Asked by the panel’s moderator, The Business Times’ deputy news editor Anita Gabriel, if his appetite for headwinds – which has allowed him to buy attractively priced assets in the past – has changed, the senior Yeoh responded with an emphatic “no”.

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“We’ve always had expansion in mind. Our policy is very simple: very boring but very dependable growth models where you can have non-cyclical earnings. Even during the Covid pandemic, when everything stopped, our net cash flow was still RM3 billion. So we have a lot of unencumbered cash reserves, tens of billions of them.”

This conservative approach is what has enabled the company to continue to be selective and patient, and to win “good, profitable deals that will last many generations to come”.

In fact, YTL’s recent moves to name the third-generation leaders as alternate directors to their parents is a signal to the market that they are now ready to take over the heavy lifting.

“This younger generation has got lots of projects,” he said. “Very exciting stuff, and they are moving very fast now with AI and all that. They are much more efficient.”

That said, each one had to “meritocratically qualify” for their respective roles.

Yeoh Pei Xien, the youngest in her generation of 27 close-knit cousins and the last to join YTL, said the group has a “family-first” approach to the future.

Yet, even though family members are welcome in YTL, many, like herself, started their working lives elsewhere.

“My father told me: ‘Go make mistakes on someone else’s dime’,” she said of her time as a management consultant. It was a good road map for her because she got to see a lot more at an “ikan bilis” (or low-ranking) working level.

“In the family business, even if you start at the bottom, just by (being) who you are, people treat you differently.”

The 25-year-old is the only child of Francis Yeoh’s youngest brother, Mark Yeoh – executive director of YTL Corp, YTL Power and the group’s hotels and resorts division.

When asked if there’s “enough to go around” in such a large, extended family, the elder Yeoh said YTL’s market capitalisation of about RM100 billion is “peanuts” compared to that of South-east Asian conglomerates.

“We are not a very large company, but what (is) different is that we’ve managed to persuade all my siblings to sign a Christian trust. That means to surrender our individual stocks in the public company to the trust.”

Being trustees, they are stewards whose wealth is derived from dividends, so “everybody works very hard in all the subsidiaries to declare the dividends” and egos don’t get in the way.

“Our generation worked together because our wealth is connected and intertwined forever to eternity. (But) there’s an ‘out’ clause. If you don’t want to, you can go out, but you cannot intervene in a negative way (or) challenge the trust.

“We’ve put in a lot of guardrails to make sure that we, the whole family, when we expand, can still work together.”

With the family trust and sharing a common goal being ingrained in her generation from the time she was young, there’s no sense of competition, said his niece.

And while there may be differences in opinion between the generations, these are not issues, since the younger Yeohs have been taught to respect their elders and there is understanding of where each party is coming from.

Among the cousins, however, the dynamics are different “because there’s a lot more history”, such as “who sat in the front of the roller-coaster” in Disneyland, she quipped.

“But ultimately, we come from the point of view that everyone has the best intentions for the business. We are taught this is not our company, but a company that we have a great opportunity to lead.”

From that perspective, and with each having their own divisions or places of influence in the business, they can disagree one day, and send each other funny videos the next.

“That’s the kind of relationship that we have,” she said of her cousins who “love to text me, tease me and encourage me”.

Beyond the family fortune, she wants her grandfather’s values of resilience, humility and hard work to be passed on to the next generation.

“I grew up listening to all those stories of hardship, stories that my nephews and nieces won’t have the opportunity to hear first-hand, and that’s the kind of struggle that humbles us to make sure we work hard. That’s something we need to ensure we tell the next generation as well, so they have this same approach to working (in) the business.”

The BTLuxe Edit – Future:Legacy symposium was presented by Schroders Wealth Management, and partners included OpenTable, Sotheby’s and Risis