Singapore firms urged to improve governance

Businesses in Singapore have been urged to further enhance their corporate governance procedures by a senior government official.

Tharman Shanmugaratnam, the city state's minister for finance, has called on executives to learn lessons from the recent global financial crisis, in which companies with "robust" governance were less exposed to market weaknesses.

Highlighting the various flaws that the recession exposed in the regulation of executives, Mr Shanmugaratnam explained that financial institutions in particular must refocus their strategies around the long-term interests of their clients and shareholders.

Addressing members of Singapore's Securities Investors Association, the finance minister suggested that companies in the former British colony have relatively strong corporate governance practices, but that they can still be improved.

He said: "The combination of accounting standards based on fair market value, market competition and internal remuneration structures had the effect of rewarding risk-taking aimed at short-term returns."

The Strait Times also reported this week that Singapore was identified by global financial institutions as an extremely attractive location for senior executives working in the industry.