Singapore Corporate Governance

How is one to manage  A.I.'s disruptive threat to our industry? If we see that A.I. is but the latest in the stream of technology to do so, we appreciate how history provides instructive lessons in the value of Governance in handling change. In this podcast, we explore what happens when the Singapore's postal giant , SingPost, confronts the future where most communication is done online...

Hyflux has been an icon in Singapore, with its collapse being a shock to many. It had also caused the loss of millions of dollars within the Singaporean investing community. What governance lessons can we derive from this? In this podcast, Prof Mak (NUS), an esteemed Corporate Governance expert, generously shares deep insights on the firm and the Singaporean governance landscape. This podcast will...

Provision 11.5 is also a legal requirement, it says  “The company publishes minutes of general meetings of shareholders on its corporate website as soon as practicable. The minutes record substantial and relevant comments or queries from shareholders relating to the agenda of the general meeting, and responses from the Board and Management.” What were the bad practices in the past, regarding minut...

Principle 12 is an interesting one, “The company communicates regularly with its shareholders and facilitates the participation of shareholders during general meetings and other dialogues to allow shareholders to communicate their views on various matters affecting the company.” Aren't interactions at shareholders meeting sufficient? What "other dialogues" is this referring to? Show...

Provision 12.1 says, “The company provides avenues for communication between the Board and all shareholders, and discloses in its annual report the steps taken to solicit and understand the views of shareholders” What avenues are there for he Board to further engage with shareholders? How does UOB engage, even with the smaller retail investors?   Show Notes 1) Download the Singapore Code of Corpor...

Provision 12.2 elaborates, “The company has in place an investor relations policy which allows for an ongoing exchange of views so as to actively engage and promote regular, effective and fair communication with shareholders.” We breakdown the words regular, effective and fair - what do they mean? Show Notes 1) Download the Singapore Code of Corporate Governance below https://www.mas.gov.sg/-/medi...

Provision 12.3 says, "The company’s investor relations policy sets out the mechanism through which shareholders may contact the company with questions and through which the company may respond to such questions." This is clear-cut, if companies allow for customers to easily contact them, how much more so should they allow shareholders to do so! Show Notes 1) Download the Singapore Code o...

Principle 13 touches on a strongly trending issue - stakeholders, it says “The Board adopts an inclusive approach by considering and balancing the needs and interests of material stakeholders, as part of its overall responsibility to ensure that the best interests of the company are served.” With all the focus on ESG, this is now becoming a vital section of the Code. Show Notes 1) Download the Sin...

Stakeholders can be very powerful and in some situations, can lead to companies being boycotted or even shut down by the government.   Provision 13.1 says, “The company has arrangements in place to identify and engage with its material stakeholder groups and to manage its relationships with such groups.” But who are our “material stakeholders” and, bluntly put, who are “immaterial”?  Show Notes 1)...

Provision 13.2 says, “The company discloses in its annual report its strategy and key areas of focus in relation to the management of stakeholder relationships during the reporting period.” This now appears within the Annual Reports and the Sustainability Reports.  How so? Show Notes 1) Download the Singapore Code of Corporate Governance below https://www.mas.gov.sg/-/media/mas/news-and-publicatio...

Provision 13.3 says, “The company maintains a current corporate website to communicate and engage with stakeholders Is this possibly the simplest provision to comply with? But quite a few comply by having a website, yet do not comply with the spirit of the provision. Show Notes 1) Download the Singapore Code of Corporate Governance below https://www.mas.gov.sg/-/media/mas/news-and-publications/cod...

Wow, if you listened this far, that’s definitely an accomplishment! As podcasts go, of course there would be some episodes that we got distracted and it just became “white noise” – I’ve had that often! So feel free to re-listen to this!  It's been a pleasure delving into the intricacies of Singapore’s Corporate Governance Code with you. My goal was a simple one it's to help make learning...

Provision 10.5 does not get too much attention but is important “The AC meets with the external auditors, and with the internal auditors, in each case without the presence of Management, at least annually.” Does this provision meet all the auditors, internal and external, meet together? Or do they mean a separate meeting? Show Notes 1) Download the Singapore Code of Corporate Governance below http...

Principle 11 looks at shareholders and says “The company treats all shareholders fairly and equitably in order to enable them to exercise shareholders' rights and have the opportunity to communicate their views on matters affecting the company. The company gives shareholders a balanced and understandable assessment of its performance, position and prospects” This might not be the easiest of t...

Provision 11.1 says “The company provides shareholders with the opportunity to participate effectively in and vote at general meetings of shareholders and informs them of the rules governing general meetings of shareholders.” The right to vote is sacrosanct for a shareholder, even if his vote will not change the outcome (as there might be a majority shareholder), he will be able to vote and have h...

Provision 11.2 says “The company tables separate resolutions at general meetings of shareholders on each substantially separate issue unless the issues are interdependent and linked so as to form one significant proposal. Where the resolutions are “bundled”, the company explains the reasons and material implications in the notice of meeting.” Why is there a prevention of bundling? Isnt that more e...

Provision 11.3 says  “All directors attend general meetings of shareholders, and the external auditors are also present to address shareholders’ queries about the conduct of audit and the preparation and content of the auditors’ report. Directors’ attendance at such meetings held during the financial year is disclosed in the company’s annual report.” What signal is given, if some directors are mis...

Provision 11.4 says “The company’s Constitution (or other constitutive documents) allow for absentia voting at general meetings of shareholders." So even when absent, shareholders can vote. How is this done in Singapore? Show Notes 1) Download the Singapore Code of Corporate Governance below https://www.mas.gov.sg/-/media/mas/news-and-publications/code-of-corporate-governance-6-aug-2018-revis...

Provision 11.6 says “The company has a dividend policy and communicates it to shareholders” Companies obviously worry that setting a policy is just setting unreasonable unexpectations, after all, who can predict the future? While that is true, the benefits outweight the costs of such a disclosure. Show Notes 1) Download the Singapore Code of Corporate Governance below https://www.mas.gov.sg/-/medi...

Provision 10.3 emphasizes independence by saying,  “The AC does not comprise former partners or directors of the company's existing auditing firm or auditing corporation: (a) within a period of two years commencing on the date of their ceasing to be a partner of the auditing firm or director of the auditing corporation; and in any case, (b) for as long as they have any financial interest in t...

Provision 10.4 states “The primary reporting line of the internal audit function is to the AC, which also decides on the appointment, termination and remuneration of the head of the internal audit function. The internal audit function has unfettered access to all the company's documents, records, properties and personnel, including the AC, and has appropriate standing within the company.” The...

Provision 8.2 gets personal “The company discloses the names and remuneration of employees who are substantial shareholders of the company, or are immediate family members of a director, the CEO or a substantial shareholder of the company, and whose remuneration exceeds S$100,000 during the year, in bands no wider than S$100,000, in its annual report. The disclosure states clearly the employee&apo...

Provision 8.3 closes some hanky panky loopholes, “The company discloses in its annual report all forms of remuneration and other payments and benefits, paid by the company and its subsidiaries to directors and key management personnel of the company. It also discloses details of employee share schemes.” So payments from subsidiaries were a loophole exploited. But Employee Share Schemes, arent they...

Principle 9 says “The Board is responsible for the governance of risk and ensures that Management maintains a sound system of risk management and internal controls, to safeguard the interests of the company and its shareholders” So while people often like to blame the CEO when a firm blows up, we see that the Board is ultimately responsible! How does it carry out its role in risk, despite not bein...

Provision 9.1  talks about a Committee that some may not have heard of, “The Board determines the nature and extent of the significant risks which the company is willing to take in achieving its strategic objectives and value creation. The Board sets up a Board Risk Committee to specifically address this, if appropriate" Is the Board Risk Committee compulsory?  Show Notes 1) Download the Sing...