The Corporate Governance Advisory Committee (CGAC), working alongside SGX RegCo has unveiled proposals that would reshape how boards of listed companies operate, including a limit of five listed-entity directorships per individual.

The two bodies have put forward amendments to the Code of Corporate Governance and the SGX Listing Rules respectively, with the stated aims of raising governance standards, encouraging long-term value creation and keeping investor confidence intact. The package is designed to sit alongside work already under way by the Equities Market Review Group to bolster Singapore’s equities market.

In drafting the changes, the bodies considered global developments and gathered input from investors and listed businesses, including smaller and mid-sized firms. The reforms fall into three areas.

The first is guidance: the Code and its Practice Guidance would be updated with the outcomes they are meant to achieve, along with worked examples. The second is board independence and quality: key board committees would need an independent director as chair and a majority of independent members, director appointments and ongoing training would become more transparent, and the five-directorship cap would apply.

The third is value creation: Code provisions would be revised to stress board oversight of strategy, long-term value and engagement with investors, and companies would have to publish their capital management policies.

The proposals will now be released for public consultation, with the Monetary Authority of Singapore (MAS), SGX and the CGAC inviting feedback on how they should be implemented.

CGAC chairman Bob Tan said, “Maintaining trust in our capital markets relies on continuous improvements to our corporate governance.

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