Compel vendors to follow anti-graft policy, companies told

Not being open could lead to increased scrutiny and erode investor confidence.

Listed companies should require their business partners to comply with their anti-corruption policies, including on whistleblowing, amidst declining business integrity disclosures in Singapore, according to an analyst.

Companies should enforce strict codes of conduct for third parties, including vendors, suppliers, agents, and consultants, Wallace Lee, a partner in financial advisory at Forvis Mazars in Singapore, told Singapore Business Review.

“Establishing an independent committee dedicated to handling complaints and ensuring impartial investigations is essential,” he said in an emailed reply to questions.

“In cases involving senior management or complex corruption risks, engaging external forensic professionals with expertise in corporate investigations can further enhance credibility and effectiveness,” he added.

The anti-corruption disclosure score of Singapore-listed companies dropped 6 percentage points to 63% in 2024 from 2022, according to a National University of Singapore Business School (NUS) study released on 10 February.

It also found that these companies had the weakest external commitments against graft. A separate study by the NUS found that 23.7% of Singapore-listed companies do not disclose when they form a panel to investigate whistleblowing reports.

Corporate whistleblowing policies of companies have been in the spotlight after Singapore Post Ltd. dismissed an executive and two senior leaders accused of mishandling whistleblower allegations.

Stronger corporate whistleblower protection helps prevent misconduct and positions companies as governance leaders, which makes them more appealing to investors, Lee said.

Investors often rely on public disclosures, making transparency essential for increasing market transactions, said Lawrence Loh, a professor and director of the Centre for Governance and Sustainability at NUS.

“When in doubt, disclose,” he said in a Zoom interview. “Don't be reticent; don’t be reluctant. This information helps boost confidence and enhances company valuation, including trade liquidity.”

Lee said not being open could lead to increased scrutiny, higher due diligence costs, and potential valuation discounts from cautious investors.

He added that companies should disclose anti-corruption moves not just because it is required, but also because it would drive sustainable business success and resilience.