Date: October 11, 2015
Ms Indranee Rajah – Senior Minister of State for Law and Finance
Distinguished speakers from near and afar
Distinguished guests, Friends, Supporters, Donors, Ladies and Gentlemen
Minister, we deeply appreciate you gracing this morning’s event in spite of taking on your new portfolio only just recently. Thank you very much.
Welcome, one and all, to the launch of 6th Singapore Corporate Governance Week. I am indeed glad to see so many thought leaders from North America, Europe, Australia and Asia joining us in our Corporate Governance Week programme.
At SIAS, corporate governance is one of the key pillars in our vision for building an empowered and enlightened investing community. It is with the investors in mind that SIAS, an investor body, continues to promote good corporate governance practices and standards through various initiatives. Together with the boards, senior managers, professional institutions and regulators, we have established a good collaborative environment to achieve this objective and promote investor relations peace in Singapore. I am heartened to see 121 listed companies joining the corporate governance pledge to re-affirm their commitment to uphold good corporate governance practices. We invite those companies which have yet to join to do so in 2016.
Our government has put in place initiatives that would spur boards and senior management to see value in pursuing good corporate governance practices. Singapore”s achievement in this area to-date could not have been possible without the strong example set by the leadership of the government of the day. In particular, the pro-active stance of the Monetary Authority of Singapore, ACRA and the Singapore Exchange in providing the necessary regulatory framework and timely reviews to help keep abreast of changes in the corporate governance practices globally. These initiatives have gone a long way to establish Singapore as an investment destination.
Changing Corporate Governance Landscape
The Asian Financial Crisis was a hard awakening for many of Asian countries, regulators and companies. Since then, much has been done to improve the corporate governance landscape in Asia. Many of the jurisdictions that have a code on corporate governance have adopted the OCED Principles. In addition, the recent establishment of the ASEAN Corporate Governance Scorecard continues to raise awareness and provide support to participating ASEAN nations to raise standards.
A recent study by ACCA and KPMG on 25 markets globally, ranked Singapore first in Asia and third globally. This would not have been possible without the efforts of the MAS driving the amendments to the Code of Corporate Governance, ACRA introducing amendments to the Companies Act, and SGX vamping the Listing Rules. Correspondingly, SIAS, through its various initiatives like today’s Singapore Corporate Governance Week programme and the Singapore Corporate Governance Award, which showcases the best-in-class and, not forgetting, our brand of activism of resolving issues “in the boardroom and not the court room”, compliments the ecosystem. Collectively, these have helped to shape corporate governance landscape in Singapore. However, there is more to be done to lift our standards to become first globally.
The responsible shareholder activism role that SIAS plays, we believe, goes a long way to improve the corporate governance ecosystem here that not only protects the investments of our citizens, but causes little or no disruption to our markets.
Boards and Shareholders – Partners or Adversaries?
This brings me to theme of the Conference this year – “Board and Shareholders – Partners or Adversaries?” which is due to concerns about the independence and effectiveness of boards in discharging their responsibilities. Shareholders are increasingly demanding more say in decisions that are traditionally reserved for boards. Regulators in some countries have introduced new rules that shift more powers to shareholders. The increasing focus on proper stewardship by those who manage funds on behalf of others and growing shareholder activism have also arguably made the relationship between boards and shareholders more adversarial.
Following the financial crisis and the growing influence of institutional investors, several jurisdictions have introduced their own Stewardship Code, with U.K. being their first to implement a “comply or explain” code. It was first introduced in July 2010 to “enhance the quality of engagement between asset managers and companies and to help improve long-term risk-adjusted returns to shareholders”. Since then, a number of other countries have developed stewardship codes or are in the process of doing so. In Singapore, it is work in progress.
With Singapore’s zero tolerance on corruption, yet we need to consider problems that may arise when our companies conduct cross-border activities. In many countries, cross-border corruption is a major legal and reputational risk facing international companies. The myriad ways through which corruption can occur, the use of third parties, weak tone at the top, weak monitoring and enforcement, difficulty in detection, sales targets and incentives, are some of the major contributory factors to bribery and corruption when doing business overseas.
These are some of the topics and discussions you will gain insights from over the next two days. I have no doubt that you will be both entertained and provoked by the participation of about 30 distinguished thought leaders. I am all of you will be enlightened, updated and enthused.
I would like to sincerely thank our Guest of Honour, Ms Indranee Rajah – Senior Minister of State for Law and Finance for gracing today’s event, all distinguished speakers and panelists, who have come from various parts of the world to participate in this Conference. I also wish to thank you delegates for participating and all our sponsors and donors for their support for all the activities of this Corporate Governance Week.
We are indeed grateful to Assoc. Prof. Mak Yuen Teen for preparing an excellent Conference programme and to Mr Christopher Bennett and Dr Roger Barker from the UK Institute of Directors for their invaluable input.
Ladies and Gentlemen, enjoy the Conference.
Thank you.
