Although adhering to the code is not compulsory, compliance and due diligence augurs well for firms. Should more firms go down this road, they may in turn may entice more investors to opt for Singapore company formation.
Singapore (PRWEB) July 23, 2012
The 2012 Governance and Transparency Index (GTI), a joint project between the NUS Business School’s Center for Governance, Institutions and Organizations (CGIO), CPA Australia and The Business Times has recently been released.
In the fourth installment of the GTI, 674 Singapore-listed companies which released their annual reports (ARs) in 2011 were assessed on their corporate governance disclosure and practices as well as the timeliness, accessibility and transparency of their financial results announcements.
Inclusive of adjustments for bonus and penalties, companies’ GTI scores were based on the following indicators:
- board matters (maximum 35 points);
- remuneration matters (maximum 20 points);
- accountability and audit matters (maximum 20 points) and
- transparency and investor relations (maximum 25 points).
The GTI, which seeks to recognize companies that surpass the requirements Code of Corporate Governance, found that 68% of companies scored between the 20 and 40 point range, while only 24 or 4% of companies scored 70 GTI points and above. It also found that disclosure practices by Singapore firms have improved over last four years, pushing the mean 2012 GTI score up from 31.5 in 2011 to 34.9 this year.
The finance, multi-industry and transport, as well as storage and communications (TSC) sectors performed the best in this year’s GTI, giving boost to their respective average scores and placing many related firms in the top 25% percentile of the index.
The report also listed the 1) non-disclosure of director information, 2) tenure of and share options of independent directors (IDs) and 3) executive reelection matters as pertinent areas of improvement or areas that are commonly charged with penalty points.
Mr Satish Bakhda, Head of Operations at Rikvin, a Singapore company incorporation specialist, said, “The GTI is valuable as it shows how companies are complying with the corporate codes and identifies the areas that they can improve on. Although adhering to the code is not compulsory, compliance and due diligence augurs well for firms. It is important to emphasize that every firm plays a critical role in improving the standard of Singapore’s corporate governance. Should more firms go down this road, they may in turn may entice more investors to opt for form a Singapore company, and this conversely bodes well for the business community here.”
The revised Code of Corporate Governance will take effect on November 1 this year.
Established in 1998, Rikvin has since partnered with thousands of investors, entrepreneurs and professionals in their pursuit to access business opportunities overseas. Rikvin’s areas of expertise include company incorporation, offshore company setup, accounting, taxation and other related corporate services. Rikvin also provides Singapore work visa and immigration services for foreign professionals who wish to relocate to Singapore.
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