Amending Code of Corporate Governance and SGX Listing Rules to Restrict Remuneration Committee Composition and Mandate Remuneration Disclosure
Ministry of FinanceSpeakers
Summary
This question concerns MP Yip Hon Weng's inquiry into restricting remuneration committees to non-executive directors and mandating disclosure of performance measures for executive directors. Minister Gan Kim Yong clarified that the Code of Corporate Governance already stipulates non-executive membership and requires disclosure of remuneration for all directors and their family members. He highlighted that SGX is currently consulting on mandating the disclosure of key performance indicators to ensure alignment with long-term shareholder value. Furthermore, Minister Gan Kim Yong noted that the Corporate Governance Advisory Committee is reviewing the Code to enhance governance standards. Public consultations will be held in due course to further refine these disclosure requirements and governance practices.
Transcript
1 Mr Yip Hon Weng asked the Prime Minister and Minister for Finance whether MAS and SGX will amend the (i) Code of Corporate Governance and (ii) SGX Listing Rules to restrict remuneration committees to non-executive directors exclusively, and mandate the disclosure of specific performance measures determining remuneration, particularly for executive directors who are substantial shareholders or related family members.
Mr Gan Kim Yong (for the Prime Minister): The SGX Listing Rules and the Code of Corporate Governance (CG Code) set out baseline corporate governance standards for listed companies in Singapore. The CG Code already stipulates that all members of remuneration committees should be non-executive directors. The SGX Listing Rules require companies to comply with this or explain why they are unable to do so.
As for remuneration of directors, SGX Listing Rules currently require companies to disclose remuneration paid to each director, including executive directors who are substantial shareholders or their family members.
SGX is currently consulting on proposed amendments to sharpen listed companies' focus on shareholder value creation. The proposals include requiring companies to disclose the key performance indicators used to determine the remuneration of executive directors and how these align with long-term shareholder value creation.
The Corporate Governance Advisory Committee (CGAC)1 is similarly reviewing the CG Code to enhance governance and disclosure standards and will publicly consult on proposals in due course.