The Business Times
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THINKING ALOUD

Incorporate governance considerations when evaluating investments

Familiarising oneself with both the GTI and GIFT frameworks and scores will surely help investors understand how to gauge quality of management

    • The harsh reality is that when it comes to buying a company’s shares, the investor is really putting their faith in that firm’s management.
    • The harsh reality is that when it comes to buying a company’s shares, the investor is really putting their faith in that firm’s management. PHOTO: LIANHE ZAOBAO

    R Sivanithy

    Published Wed, Oct 9, 2024 · 05:00 AM

    HOW many investors would buy shares in a family-owned company that appoints mainly family members to the board and pays them handsomely, even as the firm reports losses and pays no dividends?

    How many investors would put their money in companies where the sales were actually made to a related party incorporated overseas and this fact was cleverly hidden from auditors?

    Put differently, how many investors or even research analysts look at corporate governance as a factor when evaluating investment suitability?

    Corporate governanceInvesting risksThinking Aloud

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