S’pore-listed firms may miss corporate governance 2017 deadline
SINGAPORE — Singapore-listed companies may not meet the 2017 deadline to comply with the Code of Corporate Governance, particularly in the area of board independence, based on data from an annual index released yesterday.
SINGAPORE — Singapore-listed companies may not meet the 2017 deadline to comply with the Code of Corporate Governance, particularly in the area of board independence, based on data from an annual index released yesterday.
These companies can adhere to the code’s board independence guidelines only by 2020, the data showed.
Jointly published by CPA Australia and the National University of Singapore (NUS) Business School’s Centre for Governance, Institutions and Organisations (CGIO), the latest Governance and Transparency Index (GTI) looked at 644 Singapore-listed companies that released their 2013 annual reports before May 31 this year.
Only 268 firms, or 41.6 per cent, have met the guidelines under the code, which was last revised in 2012.
For example, listed firms are required to appoint an independent chairman or have independent directors make up at least half the board in instances where the chairman is not an independent director. More than half of the companies examined have yet to do so.
Most firms have also been slow in disclosing their executive directors’ exact remuneration, especially that of the chief executive officers. Only 19.3 per cent of them have revealed their CEOs’ exact pay package, with the rest citing confidentiality, talent poaching and competition as reasons for not complying.
“The 2014 index results demonstrate that while Singapore’s listed companies have made good progress, we are actually still quite far from compliance to the code,” said Associate Professor Lawrence Loh, project leader of the GTI project at NUS Business School’s CGIO.
“Notably, our projections suggest that a quantum leap is needed in several critical areas, particularly in board independence. Clear encouragement is definitely necessary for these companies to comply with the requirements of the code,” he added.
Associate Professor Themin Suwardy, Singapore divisional president of CPA Australia, said all stakeholders, including boards, management, investors, regulators and accountants, should work towards better corporate governance.