It is distressing to read that local firms are behind their regional peers in good corporate governance practices (Corporate governance study: S'pore firms can do better; April 4).
To improve these dismal statistics, it could be helpful to start from first principles, such as compliance with Singapore laws and regulations.
The Accounting and Corporate Regulatory Authority (Acra) could collaborate with the local corporate secretarial ecosystem and audit all Acra-listed firms for compliance with the Companies Act and Income Tax Act. It could also work with the Immigration and Checkpoints Authority to verify the Acra-registered addresses of business owners.
Acra could also perform further audits in collaboration with other government agencies in areas including compliance with government grant reporting requirements.
Such an audit will be highly relevant for Acra-listed firms which have been beneficiaries of state funds and other government grants, such as those from the Infocomm Media Development Authority.
Investment research suggests that good corporate governance practices, which inevitably include compliance with local laws and regulations, help to drive positive corporate outcomes such as good corporate citizenship.
Consequently, they also help to deliver above-normal financial returns. This is a win-win situation for everyone.
Woon Wee Min