Companies to disclose their policy on promoting board diversity, as well as strengthen director independence to allow more check and balances for the organisation, based on proposed revisions to Singapore’s Code of Corporate Governance.
The Corporate Governance Council – formed in 2017 by the
Monetary Authority of Singapore – had released today a public consultation to strengthen corporate governance and improve investor confidence in Singapore’s capital markets.
The council believes that a well-rounded board with a mix of experience and independence is critical to good corporate governance. A disclosure on the company’s board diversity policy will encourage greater transparency and accountability on board diversity matters.
The council also recommended that companies lower the shareholding threshold of independent directors from 10% to 5%. In addition, organisations must put in place a rigorous review of independent directors who have served the board for more than nine years.
“The streamlined code is shorter and concise. It seeks to encourage companies to move away from a compliance mindset and adopt thoughtful corporate governance practices that will best support their long-term business objectives,” said the council’s chairman Chew Choon Seng.
Other proposed revisions to the code include greater emphasis on disclosures of the relationship between remuneration and value creation.
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