SGX Strengthens Corporate Governance Structure In Line With New Regulations By MAS

Singapore Exchange Limited (SGX) today announced that it will implement by 2006, the Securities and Futures (Corporate Governance of Approved Exchanges, Designated Clearing Houses and Approved Holding Companies) Regulations 2005, issued by the Monetary Authority of Singapore (MAS) today, well before the deadline of its Annual General Meeting in 2007.

The new regulations will require SGX to adopt more stringent corporate governance standards than currently recommended for Singapore-listed companies under the Code of Corporate Governance. Key areas of the new regulations are :-

1. the establishment of Remuneration, Audit and Nominating Committees;
2. enhanced independence requirements relating to members of the board and key board committees; and
3. the setting up of a Conflicts Committee to oversee self-regulatory conflicts.

The required committees have been established by the Exchange since 2000. In 2004, the Conflicts Committee was re-constituted such that its composition and mandate are in full compliance with the new regulations. In light of the new requirements, SGX will review the composition of its board, Audit Committee and Remuneration Committee.

To complement these legislative changes, SGX will dissolve its Appeals Committee as a board committee and re-constitute it as a committee independent of SGX. This new structure will provide a greater level of impartiality and objectivity.

Ms Yeo Lian Sim, EVP and Head of Risk Management and Regulation Group welcomed the new regulations. She said, “SGX has already met most of the new requirements; we will continue to diligently manage the distinction between our regulatory and commercial roles to better serve all our constituents”.