When poor governance meets liberal rules

IN APRIL, (my colleague at the National University of Singapore Business School) Richard Tan and I released a report titled "Avoiding potholes in listed companies", published by CPA Australia. The report identified 16 warning signs and red flags in corporate governance, disclosure and reporting that had differentiated 33 companies that had run into serious corporate governance or accounting problems, and comparable companies that had not.

The study also found 14 other companies that had many of the same red flags and may therefore be at risk of suffering the same fate soon (although we did not name them in the published report).

Allied Technologies Holdings was one of them. In the three years leading up to April 2018, it had nine of the 16 warning signs and red flags already present, including the sudden resignation…