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SGX said on Monday that it is carrying out a review of how listed companies abide by the "comply or explain" requirement for principles and guidelines of the Singapore Code of Corporate Governance.
The review will cover annual reports of over 550 mainboard companies released in the 12 months to June 30, 2015. SGX intends to make findings of the review public and engage with relevant companies to ensure shortcomings identified are addressed.
The review will capture all aspects of the CG Code and focus on the areas specified in the SGX Disclosure Guidance document. Examples of key CG Code principles covered in the review include board composition, risk management and internal controls and disclosure on remuneration.
"A company's approach to the Code of Corporate Governance principles speaks volumes about its commitment to business transparency and accountability to stakeholders. Companies are under ever increasing scrutiny; those with good governance will build up reserves of shareholder trust and confidence which can be drawn upon should they become victims of negative research reports or short selling," said Tan Boon Gin, chief regulatory officer of SGX.
SGX will work with KPMG which has been appointed to carry out the review of companies' annual reports. The review is expected to take four months to complete.