SINGAPORE Exchange (SGX) and Spring Singapore are collaborating to support small and medium enterprises (SMEs) in building their financial management capabilities.
SMEs often face challenges accessing funds for growth, as investors are concerned about their financial systems, processes and corporate structures. The absence of strong internal controls and proper risk management measures also renders SMEs vulnerable to a variety of business shocks, which could in turn limit their growth potential.
To address the capability gaps, SGX and Spring will jointly reach out to SMEs, encouraging them to work on five financial management areas that are critical for sustained business growth, particularly in the area of fund-raising, both parties said in a joint statement.
These five areas are corporate restructuring as well as the development of frameworks and processes for risk management, corporate governance, internal control framework, financial reporting and investor relations.
Building competencies in these areas will strengthen SMEs' processes and systems in preparations for business growth and expansion, and also position them for easier access to capital markets, the statement said.
As part of the collaboration, SGX and Spring organised the SME Financial Management Growth Seminar at the SGX Auditorium on Tuesday.
The half-day seminar, which was attended by over 100 participants from 15 industries, aims to raise SMEs' awareness on the importance and benefits of building a strong financial management foundation early in their development journey, as well as enable knowledge exchange between industry experts and business leaders on key financial management strategies that SMEs should focus on to achieve sustainable growth.
Yeo Meow Ling, director of Spring Singapore's capability development division, said: "Sound, effective financial systems and processes are crucial to support SMEs' expansion as they seek to scale their business.
"Through our collaboration with SGX, we aim to help SMEs enhance their financial frameworks and strategy to access capital markets and achieve sustainable growth. Spring will also explore collaboration opportunities with industry partners to support SMEs in their efforts to build up financial management capabilities."
Mohamed Nasser Ismail, SGX's senior vice-president and head of SME development & listings, added that a large spectrum of SMEs would stand to benefit from this initiative, with trends of both larger and smaller SMEs being listed on SGX's Catalist board over the last three years.
"Going forward, we will continue to collaborate closely with industry stakeholders to enable SMEs to tap on local capital markets as part of their broader expansion strategies," he said.