Good morning and welcome to SGX.
A prodigious number of reports are released every year in Singapore covering themes such as governance, transparency, diversity, sustainability and so on. One might wonder if these reports matter, especially to regulators.
So I wanted to take the opportunity this morning to say a resounding “Yes”. The Singapore Directorship Report is a very good example why I say this.
If you look back at earlier editions of the Report up to 2021, they told us one thing, that boards were hanging onto their Independent Directors, or IDs, that new IDs just weren’t being appointed and ultimately, our companies were simply not progressing in terms of board renewal and board diversity.
Even after we tried to address this by introducing the so-called 2-tier vote on long-serving IDs, or IDs who have served more than 9 years, we hardly saw any change in the data.
The Singapore Directorship Report, as you will note from the latest edition, has a section on Board Tenure. In the 2021 edition of the Report, 60% of companies had at least 1 long-serving director. In terms of IDs overall, almost 1/4 were long serving. So the objectives of the 2-tier vote were not being achieved.
In this year’s report, we will see that the rate is just 3%; only 3% of IDs are long-serving. So we know that the profile of IDs is finally changing. This suggests that the move we made, from the 2-tier vote to hard capping the 9-year rule for IDs, has had a positive effect. There are other data points which you will see later that show progress on both board renewal and board diversity fronts.
For me, one of the most heartening points was that almost half of IDs appointed in 2023 and 2024 had never been on the board of an SGX-listed company. Almost half are first-time directors. As we welcome more companies listing at the IPO Arena outside, I hope to see this trend continue.
As regulators, we are constantly looking at quantitative and qualitative data. For example, feedback from the market including from directors like yourselves and reports such as this Singapore Directorship Report.
I personally appreciate the insights that can be gleaned from such reports, and I hope inspiration will also strike our panelists later.
The information from these sources is critical to our policy making process as dipsticks or barometers. In other words, they inform regulators whether our measures have had a positive change, and if not, prompts us to act decisively to make a change. We saw this in 2023 when we hard coded the 9-year rule for IDs and mandated board diversity disclosures.
So be assured, my team at RegCo and I will be combing through this 2025 report for meaningful trends and developments. We will continue to do our part to ensure regulatory objectives are met, and we look forward to more “Eureka” moments that will transform and benefit our market.
Thank you very much.
