Corporate governance and culture must go hand in hand amid complex challenges: Sias
They are ‘two sides of the same coin’, says founder, president and CEO David Gerald
[SINGAPORE] As companies face increasingly complex challenges, David Gerald, the founder, president and CEO of the Securities Investors Association (Singapore), or Sias, believes that good governance anchored in a strong and ethical corporate culture will serve as a foundation that ensures resilience and trust.
“It is important to recognise that governance and culture are not mutually exclusive, but two sides of the same coin,” said Gerald at the opening of Sias’ corporate governance conference on Thursday (Nov 6).
He noted that a company’s board sets the tone from the top and is key to fostering the right culture. This, he added, is especially important at a time when businesses are facing a range of “new and complex” challenges, including technological disruptions, climate risks, shifting US tariffs, evolving shareholder expectations, and escalating geopolitical uncertainties.
Gerald said that the conference aims to provide insights into such issues affecting companies, their boards and stakeholders through panel discussions featuring practitioners and experts. For instance, Singapore Exchange Regulation (SGX RegCo) CEO Tan Boon Gin noted the emergence of signs that the market here is beginning to prioritise climate reporting and driving shareholder value creation.
However, he noted, relying solely on regulation to achieve compliance amid this shift is an “uphill battle”.
“I need the market to care, to engage our companies, to reward outperformers and punish those who fall short,” Tan said in a session at the conference.
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In a call to action, he urged companies, directors, and C-suite executives to seize the opportunity to engage with large companies and fund managers, and to develop the right skill sets, mindset and culture now.
“Regulation yields the best results when aligned with market forces,” he said.
The need for strong governance becomes even more critical as Singapore’s tech sector continues to grow.
In his opening address, Minister of State for Manpower Dinesh Vasu Dash highlighted that as Singapore’s tech startups scale and reach the point where they can list – either locally or internationally – it is “important for them to be well-versed with what corporate governance is about”.
He added that it is then crucial for agencies such as Sias to evolve their systems and better support these startups.
The way corporate governance veteran Dr Roger Barker sees it, major corporate successes are often underpinned by strong corporate culture.
Speaking at a panel session on the role boards play in driving corporate culture, he noted that the purpose of corporate governance is not just about creating rules, processes and frameworks.
“We are trying to shape the culture in the right direction and directors, in particular, are starting to focus on this more, because we took it for granted for a long time,” said Dr Barker, an adviser on Sias’ corporate governance conference and forum advisory committee.
He stressed that, at the very least, companies must clearly define the culture they aim to create and hold the CEO accountable for delivering it.
Fellow panellist Arthur Lang, group chief financial officer at Singtel Group, added that “corporate culture is something that company employees do without even a rule book”. While company performance is important, he believes what the company stands for is fundamental.
Meanwhile, Wong Ai Ai, independent non-executive director at City Developments, sees corporate culture as a set of shared values and norms that define what is acceptable behaviour and what is not. However, she finds it difficult to establish a corporate culture from the very beginning and expect everyone to follow it rigidly.
She then raised the question of how corporate culture should be defined, who sets it and who creates it – whether it is management or the board.
Dr Barker responded by pointing out that both the board and management play crucial roles, but have distinct responsibilities.“The board is there to define what the culture is, pick the right management team that is going to deliver that culture, and monitor the situation,” he explained. “The management team are the people who are in the trenches on a day-to-day basis, living the culture and trying to make it happen through their leadership, examples (and) actions.”
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