Singapore companies improve slightly on corporate governance; Sats retains top spot in key index
City Developments Ltd no longer in top 10 for first time since 2016; CapitaLand Ascott Trust stays No 1 in Reits and business trust category
[SINGAPORE] Companies listed on the Singapore Exchange (SGX) have made slight improvements in their corporate governance practices and transparency in financial disclosures, going by an annual scorecard developed by industry and accounting bodies as well as academics.
The Singapore Governance and Transparency Index (SGTI) scores for 2025, released on Wednesday (Aug 13), showed that companies in the general category received 70.9 points out of a theoretical maximum of 143 points. This was marginally higher than the 69.3 points they scored in 2024.
As for the real estate investment trust (Reit) and business trust category, the mean score stood at 90.2 points, higher than the 86.6 points last year.
Ground handler and caterer Sats retained its pole position among companies in the general category, although its overall score of 114.1 is lower than the 118 points it got last year.
Jumping two places from the year before, asset manager Keppel came in second this year, while telecommunications company Singtel went up one position to finish third.
City Developments Ltd was not in the top 10 for the first time since 2016.
A NEWSLETTER FOR YOU
Friday, 12.30 pm
ESG Insights
An exclusive weekly report on the latest environmental, social and governance issues.
In the Reits and business trust category, three CapitaLand-related entities swept all top three places.
CapitaLand Ascott Trust once again maintained its No 1 spot with 108.6 points, an improvement from its overall score of 104 points in 2024.
CapitaLand Ascendas Reit came in second, while CapitaLand Integrated Commercial Trust was third. Both went up by one place from last year’s outcomes.
SEE ALSO
The assessment was jointly conducted by CPA Australia, the National University of Singapore Business School’s Centre for Governance and Sustainability (CGS), and the Singapore Institute of Directors. The Business Times was the strategic media partner for the study.
For the 2025 rankings, researchers assessed the disclosures of 467 listed companies as well as 42 Reits and business trusts. These included their annual and sustainability reports, websites, SGX announcements, as well as media coverage related to these companies.
As with previous years, companies in the general category were assessed based on the same five criteria: board responsibilities; rights of shareholders; environmental, social and governance (ESG) and stakeholders; accountability and audit; as well as disclosure and transparency.
However, this year’s index expanded its emphasis on sustainability disclosures, including climate reporting.
Corporate governance scorecard
Companies performed strongest in disclosures related to shareholder rights, attaining a mean normalised score of 86.8 per cent. This was followed by ESG and stakeholders, as well as accountability and audit, both with mean normalised scores of about 68 per cent.
Board responsibilities (56.5 per cent) as well as disclosures and transparency (51.5 per cent) performed the worst out of all five criteria. In fact, the two had a drop in their mean score compared to last year’s results, while the other three notched improvements.
For example, how a company’s chief executive officer is being appraised – which is one criterion in board responsibilities – is not outlined as clearly as other disclosures, noted CGS director Professor Lawrence Loh, who was speaking on Wednesday at the launch of the 2025 rankings.
Companies were also found to be less diligent in providing details on interested-party transactions, he added.
Across the various sectors, companies in the finance, real estate and consumer sectors were found to have the highest mean scores. Unsurprisingly, large companies with more manpower and financial resources also scored better than mid and small-cap companies.
Specific to sustainability disclosures, the 2025 scorecard revealed that more companies disclosed their short-term quantitative sustainability targets (83.3 per cent), compared with similar targets over the mid or long-term (66 per cent). This was a reversal from previous years, noted Prof Loh.
He added: “I think this is in line with the SGX regulation (mandating climate-related disclosures, which requires companies to) consider all timeframes.”
Similar sets of results can also be found among Reits and business trusts, which were evaluated on criteria similar to those for companies in the general category, but with additional assessments on structure, leverage, interested-person transactions, competency of the Reit manager or trustee-manager, as well as emoluments.
Shareholder rights had the highest mean score of 97.6 per cent, a significant improvement from 86 per cent the year before. ESG and stakeholders (81.9 per cent), as well as accountability and audit (84.8 per cent) were also better disclosed; the mean scores for these two criteria last year did not cross the 80 per cent threshold.
Once again, board responsibilities was the criterion with the lowest level of disclosures at 69.3 per cent, a marginal improvement from 69.1 per cent.
New SGTI framework
With Singapore’s capital markets moving towards a disclosure-based regime, as part of wider plans by regulators to revive the city-state’s equities market and put more attention on shareholder value creation, Prof Loh said that the SGTI team may introduce a new assessment criterion focusing on value creation for 2026 and beyond.
Indicators of value creation, such as return on equity, net profit margin and price-earnings ratio, may be incorporated alongside the current review of governance disclosures and practices.
Copyright SPH Media. All rights reserved.
