What SGX expects of issuers' disclosures during Covid-19

THE Covid-19 outbreak has given rise to high levels of volatility in the global financial markets. Covid-19 and the resultant actions taken by the governments and businesses around the world to protect public health and safety are unprecedented on many fronts. Companies and individuals alike have had to make major adjustments amid the current challenges.

Issuers, for example, are facing pressures such as difficulties with organising annual general meetings because most events and gatherings can no longer take place. Companies have struggled to produce annual reports with the shutting of most workplaces and staff working from home. In recognition of the challenges that issuers are facing from these contingencies, SGX RegCo has recently announced measures to support issuers, including providing an extension of time to publish their annual reports and hold annual general meetings, as well as enhanced flexibility in fundraising.

Shareholders too face pressures in their investment decision-making; the current business and economic uncertainty and market volatility make it absolutely necessary for shareholders to have up-to-date information concerning material changes in issuers' business and operations. We are consequently issuing this column to remind issuers that reliance on broad-stroke explanations pinned on a decline in general economic activity to explain away their outlook would be deemed inadequate and of little utility to their shareholders. Many companies have shut stores, outlets, plants and offices, and curtailed business activities. The impact of these decisions, for example, may be quantifiable and should be disclosed, such as proportion of retail units in a mall that are shut due to Covid-19 measures or capacity at which plants are operating. At the very least, companies must be transparent about such decisions, including providing data on operations that have been suspended or curtailed.