Rules work much better than persuasion: KPMG/ISCA study

[SINGAPORE] Where risk management practices are concerned, a study has found that listed companies comply with rules far better than they do with best-practice guidelines.

In the case of the Singapore Exchange's Listing Rule 1207 (10), 98 per cent of companies fell in with the requirement that they provide an assessment of the adequacy of the company's internal controls in its annual report; 80 per cent went further to disclose a basis for their opinion.

With the revised Code of Corporate Governance's Principle 11.3 - which recommends a similar practice - only 12 per cent of companies complied, according to the study jointly done by KPMG and the Institute of Singapore Chartered Accountants (ISCA).