Transparency pays . . . in good and bad times

WHEN in doubt, disclose. This cardinal rule governing disclosures of material information was driven home recently by none other than Tan Boon Gin, the chief regulatory officer of Singapore Exchange (SGX), in an address to company directors.

Mr Tan did not mention names but his stark reminder about the need for transparency in a disclosure-based regime came amid an outcry over what investors saw as disclosure lapses on the part of troubled oil & marine (O&M) player Swiber Holdings. Mr Tan called for listed companies to take into consideration economic conditions as well when weighing the materiality of information. This is important at a time when O&M players, including service providers, are going through a prolonged winter precipitated by the collapse of oil prices.

But disclosures alone won't do if crucial material details are missing. Past disclosures on contract awards within the O&M sector showed many were still far lacking in material details in these times of adversity even though there were marked attempts by listed yard operators to regularly give updates on delays in project deliveries.