CGAC revises Practice Guidance in Code of Corporate Governance in relation to shareholder rights and conduct of general meetings and engagement with shareholders

30 January 2024

On 14 December 2023, the Corporate Governance Advisory Committee (CGAC) issued a revised version of the Practice Guidance in the Code of Corporate Governance. The following have been amended:

• Practice Guidance 11 - Shareholder Rights and Conduct of General Meetings: A new section on dividend policy has been introduced. The section explains that the purpose of having and disclosing a dividend policy is to provide an account of how the board stewards the company’s income to create value for shareholders. Notably, the section states that it is helpful to investors when companies that do not intend to distribute dividends nevertheless communicate their considerations for not doing so under their dividend policy disclosure and identify the circumstances that would allow them to do so in the future. The section also explains that companies should review the dividend policy regularly in light of the changing business environment. Section headers have been introduced for the sections on the conduct of general meetings.
• Practice Guidance 12 - Engagement with Shareholders: A new section on investor relations policy has been introduced. The section explains that a stated investor relations policy facilitates effective two-way communication between the company and its shareholders and aligns stakeholders within the company with a coordinated approach to investor engagement.

Practice Guidance 12 is also amended to state that companies should have a dedicated investor relations contact though which shareholders are able to ask questions and receive responses in a timely manner. This contact point should be separate from contact points for business or customer issues and should be operated by the company’s investor relations department or company secretary. The Board should have the investor relations function provide regular updates on the feedback received from investors. The section on communication between the Board and shareholders has also been amended.

Reference materials

The Practice Guidance is available on relevant webpage of Monetary Authority of Singapore website www.mas.gov.sg.