Speech By Mdm Halimah Yacob At The SIAS Welcome Lunch On Thursday, 29 August 2024

Date: August 29, 2024

1. First let me thank SIAS for appointing me as your Chief Patron and giving me this opportunity to address you.

2. SIAS has played a key role in empowering ordinary Singaporeans to make better informed decisions on investments, through its easily accessible programmes and services, in addition to the other valuable support that it provides to small investors.

3. SIAS was founded in 1999 to help thousands of stranded Singaporean investors who had traded in Malaysian shares through the over-the-counter segment of the market known as Clob International. SIAS later expanded its role to cover investor education and in tracking good corporate governance in the local market.

4. SIAS recognises that small retail investors are today bombarded by numerous financial products and services which can overwhelm and confuse them and lead to poor investment decisions and losses. There still exists a great asymmetry in knowledge, information, and skills between small retail investors and those selling financial products. The rule of caveat emptor or buyers beware which applies to the market for physical goods also apply in the purchase of financial products much to the disadvantage of retail investors.

5. The global financial crisis of 2007-2008, which originated in the US and spread to the rest of the world remains a grim reminder of what can happen if there are lax regulations, greedy lending practices by financial institutions and uninformed and even reckless behaviour on the part of consumers. Many changes have taken place since then, but small retail investors must continue to remain vigilant, informed, and prudent in investing their hard-earned money and limited resources.

6. In this regard, SIAS’s efforts in helping retail investors better understand the principles of investing and financial literacy are helpful. It has conducted many educational seminars, webcasts and podcasts assisting retail investors to invest in the right way – not by listening to rumours and speculations but by doing their homework, understanding the various products, and diversifying their risk.

7. But technology is altering the investment landscape drastically with the use of sophisticated artificial intelligence algorithms and robo-advisors which have great implications on how investment advice and financial planning will be conducted. SIAS will have to consider these developments in its educational programmes and services to retail investors to apprise them of the inherent risks that come with the attractions of such conveniences.

8. Investors are also now more aware of the difference that they can make by investing responsibly in companies that uphold environmental, social and governance or ESG goals for our planet to survive. However, wading through the myriad indicators or descriptions provided by companies will not be easy including assessing whether some of these are merely green washing or are genuine efforts. This is where SIAS can play a part in assisting retail investors to understand and be better informed about ESG goals.

9. One of SIAS’ key roles remains in upholding the rights of small shareholders and providing them with a voice when problems or disputes arise. It lobbied for minority shareholders to be treated fairly, and this helped them to secure better exit prices when companies such as Tiger Airways, Boustead Projects and Lian Beng were made private. More recently, SIAS has extended its assistance to bondholders of troubled firms and helped in their restructuring. SIAS’ approach in resolving problems and disputes is through discussion and negotiation, which not everyone may agree with, but which has shown results.

10. SIAS faces constraints and challenges in carrying out its tasks. There is still scepticism over the effectiveness of its approach in dealing with disputes involving small retail investors. It will have to do more to engage, explain and persuade such investors that its current approach is in their best interest.

11. Funding limitations are another aspect, and I am pleased to note that SIAS has now secured funding support from MAS. It has also been accorded a charity with IPC status which will be helpful in fundraising.

12. This year SIAS celebrates its 25th anniversary. Congratulations and I am sure that SIAS will continue to play an important role in representing the voice of small retail investors.