Time for a stewardship code for Singapore

DEPUTY Prime Minister Tharman Shanmugaratnam recently spoke about Singapore's general regulatory environment, emphasising the need for balance between the three "pillars" of market governance - government regulation, market-based disclosure and discipline, and investor responsibility. In Singapore, this last pillar of "investor responsibility" has yet to be fully developed.

This gap is evident from the results of the 2013 Asean Corporate Governance Scorecard. Led by the Asian Development Bank and the Asean Capital Markets Forum, the regional exercise compared the level of corporate governance of companies in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.

It was telling that Singapore companies actually finished second last (Vietnam was last) in the area of "role of stakeholders", and scored a paltry 58.3 per cent in the area of "rights of shareholders", as compared to 86.2 per cent for Thailand. These are not scores we can be proud of.