As at mid-March, approximately 120 Singapore-listed companies had engaged with Value Unlock since applications opened on Jan 16. The Equip Grant co-funds training in investor relations, media communications, corporate strategy and financial management. The more substantive Elevate Grant provides up to $200,000 in advisory support, also at 50% co-funding, for companies that meet minimum market capitalisation thresholds ($100 million for Mainboard and $80 million for Catalist companies) and are prepared to publish improvement plans and progress disclosures.
The Singapore Institute of Directors’ LED10 (Listed Entity Directors module 10), “Board Strategy for Value Up”, is similarly a positive development. Bringing corporate strategy, capital strategy and investor relations together for listed company directors recognises that these topics cannot be addressed in isolation. As with Value Unlock, however, understanding what investors require at a board seminar is not the same as embedding that discipline into every major decision the board approves.
Superficially, therefore, the ingredients for a structural uplift in Singapore’s listed companies now exist: liquidity, research, advisory support and board education. Yet when one looks at SGX through an institutional investor’s lens, the verdict remains stubbornly familiar: a narrow investable core, a large long tail of uninvestable counters, and little evidence so far that programmes alone will change that structure.
The question is why. It is tempting to blame a lack of knowledge or communication skills — companies do not know what investors want; boards are not telling their story well enough. The evidence increasingly suggests a different answer: Singapore’s investability problem lies less in what companies know and more in how they are governed, who controls them, how they are paid and what risks they are managing.
See also: SGX RegCo kickstarts public consultation on enhanced disclosures to drive value creation
This is not about criticising individual companies or regulators. It is about being precise, honest and transparent about the market architecture we have built and the outcomes it produces.
Profitable, listed, but still uninvestable
A bottom-up analysis of SGX’s 613 listed companies, discussed in an earlier article in this series, shows how concentrated the exchange has become. Using simple, transparent screens: a return on equity (ROE) of at least 8%, approximating Singapore’s long-run cost of equity and a market capitalisation above $500 million, reflecting institutional liquidity needs, only 68 companies meet both profitability and scale criteria. They represent 11% of listings but hold about $813.5 billion, or roughly two-thirds of SGX’s total market capitalisation.
At the other end sit 246 “Zombies”, loss-making companies accounting for 40% of listings and about 9% of market cap.
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The group that should concern boards most are the 196 “Value Destroyers” in between: companies that are profitable on an accounting basis but earn an ROE between 0% and 8%, below a reasonable cost of equity. Collectively, they hold about $282 billion, or 23% of market cap and trade at an average P/B ratio of 0.86 times — a clear signal that the market recognises these businesses are not creating economic value despite reporting profits.
Being profitable earns a company the right to be listed. It does not earn the right to institutional capital. The market is not punishing these companies arbitrarily. It correctly prices the difference between generating earnings and creating long-term value per share.
For policymakers, this raises a simple but uncomfortable question: if the structure of SGX’s listed universe has been this skewed for years despite reforms, are we tackling the right problem?
Who really controls the boardroom?
A March 2026 study by the Centre for Investor Protection (CIP) at NUS Business School offers the clearest view yet into how Singapore-listed companies pay their executives. The study examined remuneration policies and disclosures of 510 SGX-listed issuers, drawing on annual reports for financial years ending on or after Dec 31, 2024.
The headline findings are stark. First, 284 companies (55.7% of the sample) provided no information at all on the performance measures used to determine executive bonuses. In these companies, shareholders cannot tell whether executive pay is linked to value creation, to simple profit growth, or to wholly discretionary factors.
Second, approximately 70.8% of SGX-listed companies have at least one executive director who is a substantial shareholder or related to a substantial shareholder. Put differently, about three in four executive directors are substantial shareholders or family members. In most listed companies, the person running the business is simultaneously a controlling owner and a board member.
Third, companies with such controlling-shareholder executive directors pay their executive directors more than companies without such arrangements.
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Speaking at the GDInstitute Forum on March 23, Professor Mak Yuen Teen, who led the study, observed that “remuneration seems to have a strong correlation with the movement in profits” with limited evidence of adjustment for capital efficiency or long-term value creation. The report itself notes that weak disclosure of remuneration policies makes it difficult for investors to understand the link between pay and long-term value creation, and that when executive directors are also substantial shareholders, this creates a risk of minority shareholder expropriation through unearned or excessive remuneration.
The report’s own recommendations focus on stronger disclosure and process – clearer performance measures, more independent remuneration committees and greater use of say-on-pay votes. These are sensible steps within a disclosure-based regime. But they stop short of the harder question.
In a concentrated ownership market, independent directors are ultimately nominated and removed by controlling shareholders. Advisory say-on-pay votes can be noted and set aside. Without clearer expectations on overall performance, capital efficiency and free float, and without credible consequences for chronic underperformance, further remuneration rules risk becoming another compliance exercise rather than a driver of genuinely investable behaviour.
For minority shareholders, the practical discipline in a disclosure-based regime is to sell or avoid companies whose pay structures and performance do not align with their expectations. Regulators can set disclosure and governance floors. They cannot, and should not, fix salaries by fiat.
Chart 1: A barbell market: 11% of SGX holds two-thirds of the value, while 72% are either loss-making or destroy value
These are not theoretical concerns. They are structural facts about who sits in Singapore boardrooms, how they are paid and what they disclose. When viewed against the SGX quality pyramid, a pattern emerges (see Chart 1):
• A small group (11% of all listed companies) of Institutional-Grade companies where performance, scale and governance already meet global benchmarks.
• A long tail (72%) of loss-making “Zombie” companies and “Value Destroyers” whose capital structures and governance arrangements allow them to persist on the exchange for years with limited pressure to change.
In this structure, voluntary programmes like Value Unlock are asking executives who are also controlling shareholders to voluntarily reform systems in which they hold decisive power and currently benefit. Some will do so. Many will not. That is not a judgment about character. It is a recognition of incentives.
How serious investors actually think
When institutional investors evaluate whether to commit capital to a listed company, they are not primarily asking whether the company has attended the right courses, refreshed its investor slide deck or hired a reputable consultant. They start with three much simpler questions:
• Does this business create economic value per share over time, not just accounting profits?
• Is the board disciplined and trustworthy in how it takes risks and allocates capital?
• Can we enter, hold and exit at scale without being trapped in a thinly traded, tightly held stock?
Some boards now use an explicit investor lens at the committee level to ensure every major decision is filtered through these questions. The framework itself is not the focus here; the logic behind it is.
What matters is that incentives are interrogated the way a serious buy-side investor would, before the market does it for them. The CIP study’s own evidence shows how far many Singapore-listed companies still are from that standard on remuneration alone.
On incentives, a board that approves executive remuneration without disclosing performance criteria is effectively telling the market that it cannot demonstrate a link between pay and shareholder value creation. When 55.7% of companies fall into this category, institutional investors draw a simple conclusion: management pay is not visibly tied to long-term value.
On risk, most SGX companies practise what might be called compliance-based risk management. The objective is to identify risks, document a framework, and satisfy regulators and auditors that appropriate policies exist. This is necessary. It is not sufficient.
Performance-based risk management, by contrast, asks a different set of questions. It focuses on reducing uncertainty around core strategic goals and on ensuring the company can remain resilient through severe but plausible shocks: a 30%–40% revenue drop, a sharp cost spike, a prolonged funding squeeze, without value-destructive recapitalisations or permanent impairment of its competitive position. It examines concentration risks, stress scenarios, covenant headroom, and resilience during a 12–24-month downturn.
In a world of renewed trade frictions, higher-for-longer interest rates and geopolitical fragmentation, serious investors look for boards that manage risk for performance and resilience, not just for compliance. They understand that a company which cannot demonstrate how it would navigate a severe shock without destroying shareholder value is, by definition, not a safe long-term home for capital — regardless of how many risk registers it maintains.
The gap between these two approaches is not a matter of terminology. It is a matter of how board time is spent and which questions are asked before major decisions are approved.
Asking the willing to carry the weight
Against this backdrop, Value Unlock is well-intentioned and, for some companies, potentially transformative. The Elevate Grant is targeted at a subset of “Quality Orphans” — 52 profitable but sub-scale companies that meet eligibility thresholds and could plausibly become institutional candidates if they improve their investor engagement, capital discipline and strategic articulation. For that cohort, the programme’s requirement to publish improvement plans and progress disclosures is a meaningful step.
However, these voluntary programmes sit atop a regulatory architecture that, in recent years, has softened constraints on underperforming companies. SGX has removed the financial watchlist regime and moved to a more disclosure-based approach, meaning loss-making alone no longer triggers formal remediation.
As of late 2025, 48 counters (about 8% of listings) remained suspended, with roughly $2.8 billion of “stranded” market cap and no mandated resolution timelines. Two companies have been suspended since 2015, with no announced dates for delisting or resumption.
Catalist, intended as a growth board, now holds around one-third of listings but only about 1% of market cap, with just 41% of companies profitable, and a net flow over the past decade of 17 Mainboard demotions versus nine graduations, several of which subsequently faltered.
Singapore’s 10% free-float minimum remains low by regional standards — comparable to Indonesia’s 7.5%, which MSCI has already flagged as having “fundamental investability issues,” and well below the 25% required by Hong Kong and Bursa Malaysia.
Taken together, these facts describe a structural asymmetry. The hardest measures: removing watchlists, softening interventions, tolerating long suspensions and low free float, reduce pressure on underperforming companies. The most demanding expectations — publishing improvement plans, engaging investors, adopting more sophisticated capital strategies — apply only to companies willing to opt in to programmes like Value Unlock.
In the short term, this equilibrium sustains SGX’s listing fee income and headline market size. Underperforming listed companies can continue to enjoy the benefits of being public — access to capital, currency for deals, prestige — while bearing limited structural pressure to improve returns, governance or free float.
Over the long term, this asymmetry carries risks. A persistently large tail of uninvestable counters, a thin free float and prolonged suspensions erode the exchange’s reputation, distort index weights, and consume regulatory bandwidth. The challenge is not simply that voluntary programmes may be insufficient. In practice, the companies least willing to change face the fewest constraints, while those that step forward under Value Unlock commit to higher disclosure and engagement standards. Over time, that is a poor way to broaden an investable market.
What global experience suggests — and what Singapore is not measuring
Japan’s experience is instructive. In 2023, the Tokyo Stock Exchange (TSE) began pressing companies on its Prime market to address chronic undervaluation, particularly where shares traded below book value. Companies were asked to analyse their cost of capital, disclose improvement plans and report on progress. By early 2026, about 91% of Prime companies had responded with plans.
Yet Franklin Templeton’s analysis shows that, as of March 2025, around 44% of TSE stocks still traded below book value, and roughly 30% had an ROE below 5%. Disclosure and intent have moved the dial, but have not eliminated undervaluation. The lesson is not that reform has failed, but that publishing plans is only the first step. Executing genuine changes in capital discipline, asset mix, strategy and governance is the harder, slower work.
A 2026 review of 182 empirical studies on corporate governance and firm value found that most report a positive link between stronger governance and higher market valuations, with the effect strongest in markets characterised by concentrated family ownership and weaker minority shareholder protections.
Singapore is classified as a developed market by MSCI. Still, its listed company structure — concentrated controlling shareholders, low free-float thresholds and a long tail of loss-making issuers — has more in common with emerging markets than with developed markets, where ownership is more dispersed and widely held.
Singapore already has one of the more developed governance indices in the region. The SGTI assesses 467 listed companies and 42 REITs and business trusts on governance and transparency practices each year. What is still missing from the public domain is a market-wide study that links these governance scores to valuation outcomes and institutional ownership on SGX.
This is not a criticism so much as an opportunity. If policymakers, researchers and investors could clearly see how governance quality translates into capital flows and valuations for Singapore companies, it would provide a much sharper feedback loop for boards and regulators alike.
The question boards now face
The next 18 to 24 months will be decisive. EQDP’s $6.5 billion war chest will be largely deployed by mid-2026. Liquidity conditions will normalise. Value Unlock’s early cohort of 120 companies will have published their improvement plans, executed engagements and reported at least two rounds of progress. LED10 will have run multiple cohorts of directors through its curriculum.
The group to watch most closely are the 52 Quality Orphans eligible for the Elevate Grant — profitable, fundamentally sound businesses that meet the programme’s size criteria and could, in principle, become new institutional-grade names if they marry improved governance, capital discipline and investor engagement with sustained performance.
If, by 2028, this cohort shows a measurable uplift in institutional ownership, analyst coverage and capital efficiency, Value Unlock will have demonstrated that well-designed voluntary programmes can expand SGX’s investable core beyond the current 68 companies. That would be an important success.
If, however, the market structure remains largely unchanged — if the same narrow band of institutional-grade names dominates flows and valuation, while a long tail of value destroyers and zombies continues to trade at deep discounts — then the conclusion will be harder to avoid: voluntary programmes alone cannot overcome structural incentive misalignment and a soft-touch regulatory base.
MAS has already signalled that it recognises this. At the inaugural Chairpersons Guild Forum on March 6, MAS managing director Chia Der Jiun announced a review of the Corporate Governance Code to provide more practical guidance on value creation, including capital efficiency and whether market valuation adequately reflects earnings potential. SGX is considering mandatory disclosures on dividend policy, investor relations policy and the link between remuneration and value creation.
The question now is one of calibration and resolve. Will governance code reform and mandatory disclosure obligations be framed in a way that creates real consequences for boards that choose not to change — through market pressure, investor scrutiny and reputational cost — or will Singapore continue to rely predominantly on voluntary efforts in a system where structural power lies with those who benefit most from inaction?
That is not a question that can be answered solely in policy papers. It will be answered in boardrooms, in capital allocation decisions, in the quality of improvement plans published under Value Unlock, and in whether those plans translate into better returns, stronger balance sheets and more investable companies.
For boards, the message is straightforward. The window created by liquidity, grants and training is finite. The market has already made clear that “profitable but uninvestable” is not good enough. The decision to cross that line, from “listed” to “worth owning at scale”, will not be made in MAS or SGX. It will be made by boards that choose to think and act the way their best investors already do.
Lee Ooi Keong is an independent director of a Mainboard-listed company with 30 years of experience in corporate performance, investments and risk management. He is also the founder and MD of Clover Point Consultants, an independent board and C-suite advisory firm. He was formerly the director of risk management at Temasek for over 16 years.
