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Corporate Compliance Programs Best Practices in Singapore

Singapore has long been committed to enforcing high standards of business integrity, ethical values, and governance amongst businesses. The country’s corporate governance framework encompasses legislation, codes, and best practices that ensure entrepreneurial, prudent, and effective management for long-term success and sustainability.

What is Corporate Governance?

Corporate governance refers to the set of systems and processes for providing direction and control of companies. Its primary goal is to ensure accountability and transparency in company operations, and to safeguard the interests of all stakeholders.

Key Features of the Corporate Regulatory Framework in Singapore

The Singapore corporate regulatory framework can be broadly classified into two categories: Legal Framework and Codes and Best Practices Framework.

  • The Legal Framework includes legislation such as:
    • Companies Act
    • Securities and Futures Act
    • Industry-specific regulations

Codes and Best Practices Framework

  • The Codes and Best Practices Framework includes the Singapore Code of Corporate Governance, which outlines 15 principles for good governance practices.

Key Principles of Good Governance

The Singapore Code of Corporate Governance emphasizes the importance of:

  • An effective board with strong awareness of its roles and responsibilities
  • No concentration of power and authority on the board
  • Transparent processes for:
    • Board appointments
    • Performance evaluation
    • Remuneration
  • Strong internal control processes
  • Emphasis on shareholders’ disclosure and communication

“Comply or Explain” Approach

The Code takes a “comply or explain” approach, where companies must either comply with the principles or provide a valid explanation for non-compliance.

Best Practices in Corporate Governance Compliance

To ensure compliance with corporate governance regulations in Singapore, directors should be aware of their duties and disclosure requirements. They should also seek guidance from the company secretary or compliance executives on corporate governance compliances in Singapore.

By adopting best practices in corporate governance compliance, companies can demonstrate their commitment to transparency, accountability, and good governance, which is essential for long-term success and sustainability.