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Cybersecurity critical concern of Singapore companies but not ranked high in board focus: survey
WHILE cybersecurity is a major concern at nine out of 10 boards in Singapore, it is not part of strategic discussions at board level.
According to the findings of the biennial Singapore Board of Directors (BOD) Survey of listed companies for 2017 - which surveyed 203 respondents between May and July 2017 - 93 per cent of respondents agreed that cybersecurity is of critical concern, but it did not rank high at all in terms of board focus.
Ng Wai King, chair of the 2017 Board Survey Committee, believes that companies can do more in this area.
"Companies should realise that building a stronger cybersecurity infrastructure could also serve as an enabler to defend their businesses from undesirable threats and maintain their brand positioning," he said.
The 10th edition, which is jointly launched by Singapore Institute of Directors (SID), Singapore Exchange (SGX), PricewaterhouseCoopers (PwC) and Singapore University of Social Sciences (SUSS), also revealed an uptick in the percentage of respondents taking steps to encourage more female representation on the board - 39 per cent for 2017 Board Survey compared with 14 per cent for 2015 Board Survey.
However, while 71 per cent indicated they encouraged female representation on their boards, most had no specific plans on how they intend to do so.
"The percentage of respondent firms that set specific diversity targets was only 3 per cent," Koh Wei Chern, associate professor at SUSS said on Tuesday.
The main challenge cited remained unchanged from 2015 - the lack of suitable female candidates and the lack of adequate pool of female candidates.
Rather than focus on female diversity, respondents have identified expertise, age, ethnicity and nationality as other forms of diversity that should be taken into consideration in the appointment of new directors to their boards. In addition, continued best efforts to increase awareness were again found to be the most preferred method to enhance board diversity.
Willie Cheng, SID chairman, added that companies must try and identify potential new directors via means other than through personal contacts. To this end, SID has enhanced its board appointment services to help companies search in a more comprehensive way for director candidates from among its members.
The survey also revealed that the most common type of advice sought by boards remained unchanged from 2015. These are namely legal (77 per cent), followed by financial reporting and tax (71 per cent) and corporate secretarial and compliance (64 per cent). Interestingly, there is a marked decrease in the advice sought on risk management, which fell to 36 per cent from 62 per cent in 2015.
There is a marginal improvement in the overall percentage of firms providing disclosures of the detailed remuneration of each director and chief executive officer - about 47 per cent compared to 45 per cent in 2015.
Jon Robinson, managing director of Robinson Consulting, stressed the importance of renumeration disclosures in protecting shareholders' interest.
"It is important because shareholders want to know that the board is not enriching themselves at the expense of the company. Also they need to know why and what they are paying the directors for."