Date: September 10, 2012
Objective
SIAS launched the Singapore Corporate Governance Award in 2003 immediately after the Corporate Governance Code was first introduced in 2002. The main objective for launching this Award was to impress upon the listed company boards and senior management that investors will reward those companies practicing good corporate governance. Investors are always concerned about the safety of their investments in listed companies, more so because there is a clear division between the ownership and management. Needless to say, the recent corporate scandals, both overseas and local, have heightened this concern of the investors. They want comfort in knowing that their investments are safe and hence, this Award, which strives to bring well governed companies to the attention of investors. It is now an established fact that well governed companies enjoy higher valuation. Studies carried out by reputable Universities have established that investors are willing to pay a premium for shares of companies with good corporate governance practices.
New Scorecard
Up till last year, the Scorecard used to select the winners, was based purely on the Singapore Corporate Governance Code recommendations. Companies, then, were rated firstly, on their compliance with the recommendations in the Code and secondly, in the spirit of the law, if a company had gone over and beyond the recommendations, then it was rewarded with higher scores. There were no other inputs.
This year, SIAS, together with Sim Kee Boon Institute for Financial Economics (SKBI), at SMU, and Brendan Wood International, developed a new Scorecard based on international best practices (OECD) and Shareholder Confidence Index and not just the Singapore Corporate Governance Code. Realising the importance and the value of the input from investors, their voice is now incorporated into the Scorecard. Since the Award is an Investors’ Choice Award, SIAS is fortunate to work with Brendan Wood International to incorporate shareholder ratings on listed companies.
Selection Process
The selection is a multi stage process. At stage 1, the team from SKBI led by Professor Jeremy Goh, identifies companies that scores highly based on the SKBI Singapore Corporate Governance Index and also companies with good shareholder rights practices. At stage 2, the Brendan Wood Asia (a partnership between Brendan Wood International and Mileage Group, Singapore) Shareholder Confidence Index rates Corporate Strategy, Board, CEO Leadership, CFO, Reporting and Disclosure and a variety of growth metrics as seen through the eyes of shareholders is incorporated in the scoring. SIAS Corporate Governance Awards, in addition to being based upon the two tests of governance, are also rated as TopGun companies on the Brendan Wood Shareholder Confidence Index. This Index is the competitive scorecard of public companies according to real world global shareholders. The best run and most competitive are designated TopGun Corporations. Subject to portfolio timing and pricing considerations, TopGun Corporations are generally the most approachable by world class investors.
Together, the fusion of academic and practical investigation techniques, which apply a rigorous set of tests against which only the best run companies can excel and be selected for the Award.
The Rationale
We have chosen the above process consciously as SIAS, together with SKBI and Brendan Wood International, wishes to showcase Singapore’s best performing companies in governance and Shareholder Confidence Index to investors globally by using international standards. It will, undoubtedly, raise the profile of the winning companies and consequently, the importance of the Award.
The New Award – Brendan Wood TopGun CEO Designation for Singapore CEOs
This year, besides the Singapore Corporate Governance Award, Most Transparent Company Award, Financial Journalist of the Year Award, Best Broker Award and Internal Audit Excellence Award, SIAS is pleased to announce that it has agreed to stage the Brendan Wood TopGun CEO Designation for Singapore CEOs. This Designation is relatively new to Singapore but has been presented by Brendan Wood International since 2009 for global public corporations.
Brendan Wood’s TopGun CEO apply to CEOs who are best in class as rated by shareholders in the time period. In this case year ending Sept 12.
STATEMENT FROM BRENDAN WOOD ASIA
Brendan Wood Asia, a joint venture of Brendan Wood International and Mileage Group Singapore, is pleased to collaborate with SIAS and SKBI@SMU at this year’s prestigious Annual Corporate Governance Awards. This unique annual Awards brings together a large and auspicious audience of senior corporate executives, investment professionals, investors and regulatory authorities in the interest of furthering effective governance amongst Asian corporations.
Corporate Governance research performed by the team from the Singapore’s SMU singles out Asian corporations which meet high standards of reporting and disclosure to shareholders.
Brendan Wood Asia debriefs the largest institutional stakeholders of Asian corporations to determine which managements have achieved the strongest confidence levels amongst their shareholders.
The Brendan Wood Shareholder Confidence Index rates Corporate Strategy, Board, CEO Leadership, CFO, Reporting and Disclosure and a variety of growth metrics as seen through the eyes of shareholders. Together the fusion of academic and practical investigation techniques applies a rigorous set of tests against which only the best run companies can excel. Brendan Wood Asia is proud to lend its Shareholder Confidence Index to the identification and celebration of Asia’s TopGun Governance Companies by SIAS. This year’s Governance Week will culminate with the prestigious SIAS Governance Awards as selected not only by academically credible criteria but also by the “voice of the shareholder”.
About Brendan Wood’s Shareholder Confidence Index Panel: BW’s global panel comprises 2000 major institutional shareholders, investment analysts and market intermediaries. Panelists include the majority of the world’s independently rated TopGun investors and analysts. Collectively this exclusive group represents several trillion dollars of investment capital and speaks for the majority ownership interest of the companies on the Index.
TopGun CEOs
A key factor analyzed by the Brendan Wood shareholder panel is the issue of leadership. Although Boards of Directors are perceived to be the co-architects of strategy the central figure is most often the CEO who is also responsible for the execution of the strategy of the corporation. Shareholders are tough on CEOs and their accolades are hard to obtain. Each shareholder on the Brendan Wood Panel is asked not just to rate the CEO’s performance but also to nominate the CEO as a TopGun if his or her leadership warrants it. This hard-won TopGun designation applies to less than 10% of the major corporate leaders in the world.
What makes a TopGun CEO?
TopGun CEOs score the highest marks in two or more of the following categories:
• Delivers a TopGun Value Proposition
• Leads a Culture of Accountability/Performance
• TopGun Succession in Place
• Communicates Effectively with Constituents
• Safe Hands
This year’s Panel has selected 9 CEOs for the TopGun designation who will be awarded at the SIAS Investors’Choice Awards Presentation Ceremony on 3rd October 2012 at Fairmont Ballroom, Raffles City Convention Centre.
David Gerald
President & CEO
SIAS
