Singapore ahead of the pack in Asia Pacific for corporate governance

But there are still many points for improvement.

Singapore has been ranked first in the Asia Pacific and ASEAN regions in a new study on corporate governance requirements across 25 markets.

The joint study was conducted by ACCA and KPMG in Singapore. Entitled Balancing Rules and Flexibility, it analysed CG requirements in terms of the clarity, degree of enforceability and number and type of instruments used by the different markets.

In Singapore, recent revisions to the CG Code and the Singapore Exchange (SGX) Listing Rules, particularly in the areas of assurance, audit committees, disclosures and risk governance, have enhanced the CG landscape.

A wide divergence in CG requirements was observed among the 25 markets, with the top three highest scorers with the clearest and most comprehensive CG requirements being in descending order, the UK, US and Singapore.

The markets with the lowest scores, in descending order, are the Philippines, Indonesia, Canada, China, Cambodia, Japan, Vietnam, Myanmar, followed by Brunei and Laos.

“While the scores suggest that Singapore has performed relatively well across most of the CG pillars, there are still areas for improvement. These include strengthening requirements in relation to documenting the role of the board, optimising board diversity and skill sets, disclosing codes of conduct, formalising board performance evaluations and disclosing more in relation to stakeholder engagement and CSR reporting,” noted Leong Soo Yee, Head, ACCA Singapore.

“With the ASEAN nations coming together in a single market next year, Singapore should strive to take a lead and support other ASEAN member nations to improve corporate governance. A stronger ASEAN has flow-on effects for foreign investment and future capital flows into the region,” said Irving Low, Head of Risk Consulting at KPMG in Singapore.