CapitaLand Reits top corporate governance ranking

CAPITALAND Commercial Trust, CapitaLand Mall Trust and Ascott Residence Trust have emerged at the top of the latest Singapore Governance and Transparency Index (SGTI) ranking of real estate investment trusts (Reits) and trusts.

The SGTI panel, which also has a ranking of Singapore-listed companies, had observed an improvement in the governance of Reits and trusts, going by scores published on Tuesday. This year, with 45 Reits and trusts assessed, saw a 6.2-point increase in mean scores over the previous year: from 78.6 to 84.8.

It was also observed that Reits and business trusts generally performed noticeably better than companies. This is possibly a result of the more comprehensive disclosures that are required of Reits under the Code on Collective Investment Schemes, the report noted.

The trusts were awarded a base score, with bonus points added for good practices and penalty points deducted for issues that pointed to poor corporate governance. Further, trusts were also assessed on trust-specific items: structure, leverage, interested person transactions, the competency of the Reit manager or trustee-manager; and emoluments. 

A total of 11 Reits and business trusts listed on Singapore Exchange were excluded from the SGTI 2020 ranking for various reasons, including being newly-listed and not having a full year's financial report by the cut-off date, as well as having had their trading suspended.