According to SID, directors should be “aware of their duties at law, which include acting in good faith and the best interests of the company; exercising due care, skills and diligence; and avoiding conflicts of interest”.
Independent directors, in particular, should serve as a “check and balance” within companies, notes Mak Yuen Teen, professor of accounting at the National University of Singapore (NUS) Business School and corporate governance advocate, in a co-authored article dated Sept 19, 2018, in another publication.
“Forget the big legal document. [The] basic principle is to do the right thing,” says Quek. In doing so, it means directors have to “conform” while ensuring their company is performing.
“You’re also keeping an eye on transformation. And at the same time, if you’re a listed company, please make sure you talk about disclosures, engage your stakeholders, whoever they are… because if your customers don’t see value in you, it’s going to affect your share price too,” he adds.
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Merits and competency come first
When it comes to adding value within a board, a director’s merits and competency should take precedence over token diversity. While diversity brings different perspectives and values to the table, boards must also be “fit for purpose” with capable individuals.
“Diversity is not so much about… oh, we must have a woman… [but] it’s not it… the merits must come first, because a woman can contribute equally,” he says. “So, you cannot just say, I just need a woman [as a token]. That’s the wrong approach.”
Ultimately, boards should consider whether they have the right people to steer them towards their goals in the longer term and make the best decisions for the company and its stakeholders.
“You do want directors who are very well-connected, because it means they have a lot more network information that is meaningful. So, how do you harness that? By balancing with transparency and accountability,” Quek adds.
Managing conflicts of interest
Conflicts of interest are another important consideration. To Quek, boards should determine what it is, in their view. It should also be up to the individual to ensure that conflicts are avoided. “If people offer you a board position and you take it, are you prepared to answer the public when they ask this question?”
More importantly, directors must recognise when their personal interests could compromise their judgement and recuse themselves when necessary.
Ensuring good governance
Good governance is an evolving concept. Directors must be attuned to changes in the ecosystem and broader context when making decisions, he notes. Ultimately, it comes down to balance.
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Directors must be “fully aware” of their fiduciary duties — and breaches will carry consequences.
At the same time, says Quek, the challenge lies in striking a delicate balance: protecting retail investors while avoiding an overly litigious environment.
On whether boards can play a role in keeping listed companies attractive to investors, Quek says the decision to remain listed or not is a commercial decision that companies themselves should make.
Referring to Chee Hong Tat’s speech earlier in the day, where he said companies have to communicate their strategic plans, engage with investors and present a “compelling narrative” of how today’s actions will translate into tomorrow’s success, Quek believes there are “opportunities” for directors to help. Chee is the National Development Minister and the deputy chairman of the Monetary Authority of Singapore (MAS).
“This is something that we definitely are very interested in, to look at how we can play a part to partner with MAS and other ecosystem partners. And if directors feel that, yes, I see your point, I think I also want to engage with investors; we’re here,” says Quek.
Seeking accreditation
Since Quek took on the role of CEO some three years ago, membership of the national association for company directors has grown from 3,300 to 5,500. Some four in five members are directors, while one in five are C-suite executives.
“They could be aspiring [directors] or they could be senior partners of professional firms, because they are not allowed to go on commercial boards [due to] conflict of interest. Some of them are also academics, professors [and] researchers; they make up the 20%,” says Quek.
About one in three SID members is accredited, which means they have undergone SID’s Director Accreditation Programme.
Quek launched the voluntary programme in May 2024, where accreditation hopefuls must take an accreditation exam or complete one of three specific programmes by Singapore Management University (SMU), Insead or IMD.
Accreditation is valid for two years, and renewal is conditional on completing 40 hours of an array of activities under SID’s Continuing Professional Development (CPD) scheme.
Quek says: “If I tell you that I’m an accredited director, the message I’m saying to you is: ‘I am very serious in my role as a director. I look at it professionally. I’m committed to upholding professional standards… I’m also demonstrating my commitment to continuous professional development.’ So, that is a key message that the accreditation actually sends out to the market.”
Last month, NUS’s Mak announced a couple of names that are said to join a new corporate governance body, including former Economic Development Board chairman Philip Yeo and former Bursa Malaysia chair Shireen Muhiudeen.
Mak, an outspoken corporate governance advocate, first announced he was setting up the alternative directors association in a LinkedIn post on Aug 1.
In response, Quek says SID has “always taken a very ecosystem approach”. “We can’t really comment about what other people want to do. What we focus very much on is what we are doing for our members [and] for Singapore as a whole ecosystem. We have been doing that for the last 26 years now, going into the 27th year.”
Quek adds: “At the end of the day, let’s put the directors in Singapore at the centre of the work that we do — to uplift their professionalism, to champion good governance. That’s what SID has always been doing.”
Directors of tomorrow
When asked about tools that directors of tomorrow may need, Quek says it is not so much about future skills; rather, it is about mastering today’s wide-ranging requirements, referring to the “eight dimensions” of a director’s duties: governance, risk, strategy, financial know-how, duties and practices, sustainability, digital and human capital.
“This forms the bedrock of the work we do, in addition to the A, B, C,” he says — the acronym refers to the work that SID does.
A stands for advancing thought leadership and advocacy, B refers to building competencies, while C is connecting the ecosystem.
Under the “digital” vertical, directors will have to contend with and learn about cyber resilience, digital transformation and generative artificial intelligence, which are becoming critical.
Sustainability, which is another evolving space, requires continuous recalibration due to ever-changing priorities and leaders’ decisions.
SID addresses this through scenario planning and partnerships with the Lee Kuan Yew School of Public Policy.
“After this conversation, we don’t know what’s going to come out in the headlines tomorrow and so on. That will impact the kind of conversations that we’re going to have with our directors,” he says.
Photo: Albert Chua/The Edge Singapore
