Singapore-listed companies achieve all-time high in corporate governance ratings; City Developments Limited drops out of the top ten ranks
The Singapore Governance and Transparency Index (SGTI) has been a key benchmark for assessing the corporate governance practices of Singapore-listed firms and trusts. However, the index has faced criticisms and limitations that primarily relate to the broader context of Singapore’s governance model rather than the index itself.
In the annual study this year, CDL, a real estate giant that was ranked second on the SGTI last year, has dropped off the top 10 performers list for the first time in nine years. This drop was due to a boardroom tussle in February that centered around allegations of impropriety over the nomination process for directors. Loh, a representative from CDL, refutes that the company's fall from grace points to limitations of the SGTI, stating that the revelations in the public domain this year may have contributed to CDL's lower score.
Mak, director of the Centre for Investor Protection at the NUS Business School, states that the upward trending scores in the SGTI suggest "score inflation over time." Mak is setting up a new corporate governance body as an alternative to the Singapore Institute of Directors (SID), according to media reports this week. Yeo, a long-time board member of CDL, stepped down from his position last month after two of the independent directors whose appointments he disputed were reappointed by an overwhelming majority of shareholders.
The annual study saw overall performance of Singapore-listed firms and trusts in the general category reaching an all-time high of 70.9 points. Under its separate real estate investment trusts (REITs) and business trusts category, the mean score stood at 90.2 points. Keppel and Singtel came in second and third respectively in the SGTI this year, while Jardine Cycle & Carriage and DBS climbed up to the fourth and fifth top spots. SATS, a world's largest air cargo handler, has topped the SGTI for the second year running.
Michael Tang, SGX RegCo's executive director and head of listing compliance, stated that directors are not expected to be experts in all emerging areas, but to give a holistic perspective to the management of a company on what it should prioritize to drive value creation. Smaller- and medium-sized businesses often appoint one accountant or ex-banker and one lawyer to comply with SGX RegCo's requirements, which Thio believes are not well-equipped to deal with cybersecurity, sustainability, and ESG.
Stefanie Yuen Thio, a member of the Monetary Authority of Singapore's Corporate Governance Advisory Committee, questioned if the SGTI reflects genuine corporate governance performance or simply the resources firms have to make detailed disclosures. The Centre for Governance and Sustainability at the National University of Singapore Business School is proposing for financial value-related metrics to make up 25% of the overall SGTI scores from 2026.
Despite Singapore’s reputation for low corruption and efficient governance, the government does not have a Freedom of Information Act, and some decision-making processes remain opaque. This restricts access to certain government data, raising questions about the completeness and depth of transparency measures possibly reflected in the SGTI. The government's emphasis on zero tolerance for corruption, enforced by strong institutions like the Corrupt Practices Investigation Bureau (CPIB), supported by competitive public sector salaries and strict conflict-of-interest policies, might overlook broader governance dimensions related to political competition and civil liberties.
Calls exist for more transparency, accountability, and inclusiveness in policymaking. Some citizens perceive limits on social freedoms and desire stronger mechanisms for government accountability beyond existing frameworks. This might limit how well indices like the SGTI capture governance quality from a participatory democracy standpoint. Singapore’s long-standing one-party dominance under the People’s Action Party (PAP) results in a tightly controlled political space described by some as “paternalistic” or a “nanny state.” This limits inclusiveness and diversity in governance, which could be viewed as a limitation in assessing true governance transparency and accountability beyond formal metrics.
In summary, the main criticisms and limitations relate to the scope and depth of transparency, limited political plurality and participatory mechanisms, and potential blind spots in capturing social inclusiveness, rather than explicit flaws in the SGTI metrics themselves. These issues reflect broader debates about Singapore’s governance style—a trade-off between efficiency, stability, and openness.
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