Singapore proposes tighter board independence rules and directorship cap
The consultation also covers capital management disclosures, director appointments and training, with feedback open until Jan 27, 2027.
Singapore-listed companies with a non-independent chairman would need a lead independent director under governance proposals presented on Oct 27. The Corporate Governance Advisory Committee (CGAC) and Singapore Exchange Regulation (SGX RegCo) are also proposing stronger committee independence requirements and a five-directorship limit.
The lead director requirement would move from the corporate governance code into mandatory exchange listing rules. The CGAC decided against requiring every listed company to have an independent chairman, citing Singapore’s market landscape. Where one person holds both the chairman and CEO positions, a proposed code provision would require an explanation of how chairmanship duties are fulfilled and what safeguards apply.
Each audit, remuneration and nominating committee would need an independent director as chair, with independent members forming at least a majority. The Singapore Institute of Directors reported that 70 listed entities, representing 11.4 per cent of 615 entities, had a non-independent chairman but no lead independent director in 2025.
The proposed cap would count appointments at entities listed in Singapore or overseas, including board seats at managers of listed real estate investment trusts and business trusts. The CGAC is seeking feedback on whether to make the limit mandatory or place it under the code’s comply-or-explain framework.
Companies would also face fuller disclosure requirements covering director selection, nomination procedures, diversity considerations and relevant professional development. They would need to disclose whether their nominating committee supports each appointment or reappointment, explaining any lack of support.
Another proposal would require companies to maintain and disclose a broader capital management policy, potentially covering allocation priorities, shareholder returns and balance sheet management. Its mandatory or comply-or-explain status remains under consultation. Other recommendations address risk reporting, long-term strategy, investor engagement and current financial and governance information on company websites.
