The 2018 Singapore Spencer Stuart Board
Index is a review of governance practices among the 30 constituent companies of the FTSE Straits Times Index (STI). It also offers a useful comparison against similar board index reports from other countries. Key findings from this third edition of the report are summarised below.
More women on boards
The representation of women on the boards
of the top 30 Singapore firms with the largest
market capitalisation has been on a modest
upward trend since 2014, increasing from 8 per
cent in 2014 to 12 per cent in 2018. However,
only 67 per cent of STI30 boards have at least
one woman director, compared to 73 per cent
Average age of directors flatlines
The average age of STI30 directors has
remained about 62 years old since 2014, and
a large proportion of the board members are
between 56 and 75 years old.
Dip in proportion of independent directors
On average, 57 per cent of directors on the
boards of the STI30 are independent, down from
63 per cent in 2016 and 65 per cent in 2014.
Independent director tenure below 9 years
The average tenure among independent directors of the STI30 is 5.9 years, with about
a third of independent directors serving less
than three years. The average tenure of nonexecutive
directors of STI30 companies is 7.3
years. Seventy-six per cent of non-executive
directors have a tenure of 10 years or less,
compared with 81 per cent in 2016.
Upward trend in board retainer fees
Board retainer fees for chairs and members
across board and board committees (audit,
remuneration and nominating) have been
rising steadily since 2014. Directors on
remuneration committees showed the greatest
percentage increase (11 per cent) from 2016
Most boards perform some form of annual
A substantial majority, 90 per cent of the
STI30 companies had some form of board
assessment, whether executed internally by
their nominating committee or an external
facilitator. Interestingly, 20 per cent of STI30
companies engaged a third party to carry out
their board assessment, compared to 33 per
cent in 2016.
Improving board effectiveness
Many of the changes stipulated in the revised
Code of Corporate Governance issued in
August 2018 will require companies to not
only evolve, but revolutionise their current
practices. Board diversity and director
independence remain critical agenda items,
and the new Code aims to enable companies
to make continued progress.
A table highlighting select indicators of board composition, board performance and director remuneration for the 30 companies can be viewed in the PDF.
This article was originally published in the 2019 Q1 issue of the SID Directors’ Bulletin, a publication of the Singapore Institute of Directors.