New risk governance guidance for listed boards

It was released to limit risk exposure and avert a repeat of the governance disaster last seen in the 2008 financial crisis.

According to the Corporate Governance Council, which released the new guidance: "There is heightened concern and focus on risk governance, and it has become clear that companies should have a sound system of risk management and internal controls to identify, assess, manage and mitigate risk."

"In this regard, following its review of the Code of Corporate Governance (Code), the Guidance is another key initiative by the Council to strengthen the corporate governance practices of listed companies in Singapore," it added.

"The Council intends the Guidance to provide key information on risk governance to all Board members. This would include factors which the Board should collectively consider when overseeing the company’s risk management framework and policies. The Guidance also spells out the Board's and Management’s respective responsibilities in managing the company's risks. The Guidance is not meant to be a new rulebook or to prescribe additional standards. Its purpose is to enhance the awareness of Board members, and spur them to work towards strong corporate governance in their companies," it said further.

Mr Alan Chan, Chairman of the Council, said, “The Guidance, with its focus on risk management, acts as a complement to the Code and enhances the framework for corporate governance of Singapore-listed companies. Along with other existing materials such as the handbook for directors published by the Accounting and Corporate Regulatory Authority, the Guidance will contribute to better awareness of Board responsibilities within Singapore companies. This will in turn enhance investor confidence and Singapore’s reputation as a trusted financial and business hub."