Sheng Siong explains non-compliance, says ‘not necessary’ to add more IDs due to group’s size
SUPERMARKET operator Sheng Siong Group on Monday (Jun 12) responded to questions over its non-compliance of a corporate governance code provision setting out that independent directors (IDs) will need to make up a majority of its board.
The Singapore Exchange Securities Trading on Jun 8 said Sheng Siong has not complied with the provision, which is relevant as its chairman is not independent, along with a provision stipulating that non-executive directors have to make up a majority of the board.
Sheng Siong’s board currently comprises 10 directors, five of whom are non-executive and independent. Chairman Lim Hock Eng is part of the management team, and is a brother of chief executive officer Lim Hock Chee.
On Monday, the company said its reason had already been disclosed in its annual report for the 2022 financial year ended Dec 31. It was stated there that the board is of the opinion that it is “not necessary” to add more IDs and non-executive directors due to the group’s current size and operations.
Noting that the IDs and non-executive directors already make up half the board, it added the board is able to “exercise objective judgement through constructive dialogue” and “no individual or group of individuals dominate its decision-making process”.
It also said lead ID Patrick Chee Teck Kwong does avail himself to shareholders when they have concerns, and leads regular meetings without the management’s presence to discuss affairs of the group.
Sheng Siong, meanwhile, has given assurance that its IDs and non-executive directors “participate actively in discussions, reviewing and assessing management’s performance”.
The group then reiterated that the board is of the view it has an “appropriate level of independence” and that its size is “appropriate”.
Shares of Sheng Siong closed 0.6 per cent or S$0.01 higher at S$1.62 on Monday, before the filing.
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