An ongoing review of corporate governance and economic legal infrastructure issues are essential as Singapore moves into the 21st century, said Peter Chen, senior minister of State for trade, industry and education.
Speaking at the Jetro-Insead Symposium, Chen said the fundamental principles of good corporate governance all play a crucial role in investor decisions worldwide. He explained that companies with good corporate governance tend to be more resilient during market downturns.
“Having good corporate governance and economic legal infrastructure has become a fundamental for economic competitiveness for any country,” he said.
Chen proposed that a nominating committee should be set up to provide a formal and transparent process for the appointment and re-election of directors. He added that every listed company should also establish a remuneration committee to ensure greater clarity on the principles of compensating directors.
“A company’s audit committee should be made up entirely of non-executive directors with at least two members of the audit committee having accounting or financial management expertise, to enhance the members’ confidence and independence in the committee’s dealing with the management,” he said.
Chen also emphasised the need for companies to provide timely disclosure of information to all shareholders in an equitable manner.
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