Deepening investor protection in Singapore
As market complexity increases and retail participation grows, the subtleties of engagement, enforcement and education must be addressed next
[SINGAPORE] Over the past decade, Singapore has improved its legal and regulatory framework for investor protection. These regulatory reforms have led to meaningful enhancements in disclosure requirements, shareholder rights, and enforcement mechanisms. These changes are in line with international standards, such as the G20/OECD Principles of Corporate Governance and the International Organization of Securities Commissions’ Objectives and Principles of Securities Regulation.
Despite the regulatory strides forward, it appears that there are implementation gaps, and, for too many retail investors, shareholder democracy feels more aspirational than actual progress. The recent continuing saga of the trial against Hyflux founder Olivia Lum, as the firm suffered massive losses and eventually entered liquidation, highlights some of the power imbalances between shareholders and executives in corporate governance. In the Hyflux case, more than 34,000 investors are owed S$900 million.
Strengthening the institutional ecosystem
The establishment of the Singapore Exchange Regulation (SGX RegCo) in 2017 as a separate entity of SGX marked a watershed moment. By structurally separating the regulatory and commercial functions, Singapore addressed longstanding concerns about conflicts of interest.
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