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SINGAPORE: The Singapore Institute of Directors (SID) wants to give companies a hand in establishing boards of directors best suited to their needs.
SID is planning to launch a new service to match firms with a potential pool of independent directors selected from its own membership. The service will be available on its website by early 2010.
SID said the idea arose from a growing trend which saw directors reluctant to take up new positions, despite being qualified and trained by the institute.
"Many issues came about, unfairly putting the blame on the board members. Some are genuine, some not so genuine. I think that has resulted in many good directors becoming more hesitant to take up board appointments," said Chew Heng Ching, chairman of Singapore Institute of Directors.
SID's plan, announced at its annual general meeting cum luncheon on Friday, is seen as part of efforts to further improve corporate governance.
Second Minister for Finance Lim Hwee Hua, speaking at the same event, said it is important for boards to be transparent and communicate well with shareholders, but investors should play their part as knowledgeable shareholders.
"It is healthy that shareholders take an active interest in the affairs of the companies they have invested in. But shareholders should distinguish between cyclical effects and the consequences of deficient corporate governance," said Mrs Lim.
Mrs Lim added that the next challenge for boards of directors coming out of the downturn would be to manage their human capital and improve risk management systems while maintaining transparent and clear communication with shareholders.
- CNA/sc
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