August 2026 Newsletter

Executive Pay | Market Regulator Proposes Consolidated Disclosure Norms For Executive Pay At AMCs

The Indian market regulator, Sebi, has proposed that asset management companies (AMCs) may disclose consolidated remuneration of executive-level employees and the total number of such employees. Sebi said that such an approach would give investors in the funds of AMCs a broader view of senior management compensation. “Disclosure of executive remuneration is an important pillar for sound corporate governance, as it enables stakeholders to assess whether compensation structures are aligned with performance, risk management, and the interests of investors,” the circular said. 

The regulator said that the proportion of employees covered under the current disclosure framework is limited, typically ranging from approximately 2% to 10% of the total employee base in 36 out of 51 AMCs, while only a limited number of AMCs fall in higher brackets, depending on structural factors such as overall employee base and mandatory disclosure of top 10 employees, which is a key determinant of coverage in AMCs with smaller employee strength. AMCs are required to disclose the following on their website under a separate head “Remuneration”, which will have the name, designation, and remuneration of the Chief Executive Officer (CEO), Chief Investment Officer (CIO), and Chief Operations Officer (COO) or their equivalent by whatever name it is called. Secondly, the name, designation and remuneration of the top ten employees in terms of remuneration drawn for that financial year, as well as of all employees whose annual remuneration was equal to or above Rs 1.02 crore for the financial year or whose monthly remuneration in aggregate was not less than Rs 8.5 lakh per month, if the employee is employed for a part of that financial year. Next, it should have a ratio of the CEO’s remuneration to the median remuneration of MF/AMC employees and MF’s total AAUM, debt AAUM and equity AAUM and rate of growth over the last three years. The circular further said that listed AMCs are already subject to detailed remuneration disclosure requirements under the SEBI LODR read with the Companies Act, including granular, component-wise disclosures in their annual reports. In contrast, unlisted AMCs operate within a different structural and regulatory context and are not subject to such frameworks. Accordingly, the disclosure requirements applicable to listed entities may not be directly comparable to those for unlisted AMCs. 

At present, the remuneration of fund managers is not disclosed separately and is captured only incidentally based either on threshold/top 10 employee disclosures. Considering that investment decision-making for each scheme rests primarily with the respective Fund Manager(s), there may be merit in providing visibility into their remuneration. However, such disclosures may involve sensitivity considerations. Accordingly, it is proposed that scheme-level consolidated disclosure of total remuneration paid to fund manager(s) may be made available upon specific request of unitholders and may be limited to the scheme(s) in which the investor requesting such details has invested as on the date of making such request. Read More.

Board Effectiveness | Making Board Assessments Count

Boards face growing challenges as directors’ responsibilities expand and business conditions become more complex. Rapid technological change, geopolitical volatility, shifting regulation and heightened investor scrutiny have expanded the board’s role well beyond monitoring financial performance and CEO succession. Directors must now absorb more information, engage earlier on emerging risks and help management navigate uncertainty without slowing the organization down.

In that environment, the annual board assessment can be one of the board’s most important governance tools. While annual evaluations are required for New York Stock Exchange-listed companies and are standard practice across most public companies, the real question is whether they drive meaningful change.

Leading companies are expanding board assessments to include committees and individual directors, reflecting a broader focus on board effectiveness. But the process still has room to improve: According to PwC’s 2025 “Annual Corporate Directors Survey,” 78% of directors say current assessments don’t provide a complete picture of board performance, while 51% say their boards aren’t sufficiently invested in the process.

A full-board assessment can identify whether agendas are balanced, materials are useful and boardroom discussion is sufficiently strategic. Committee assessments can test whether oversight responsibilities are allocated appropriately and whether committees have the right leadership, expertise and information. Individual director assessments can go further, surfacing questions about preparation, capacity and fit with the board’s future needs.

Together, these layers give boards a clearer view of effectiveness. But broader assessments do not automatically produce better boards. The value comes from the candor of the feedback, the quality of the discussion and, most importantly, whether the board acts on the results.

Assessment as a Governance Discipline:

The annual assessment is often described as a governance best practice, but that framing can understate its importance. While the formal evaluation typically occurs annually, the most effective boards reinforce it through ongoing feedback and periodic check-ins throughout the year. The assessment is not simply a compliance exercise; it is a discipline for managing the board as a strategic asset.

That distinction is especially important as boards move away from rigid refreshment mechanisms. Mandatory retirement policies and term limits remain part of the governance toolkit, but many boards favor more flexible, judgment-based approaches.

But flexibility requires discipline. The assessment process should help the board determine where continuity remains valuable and where fresh perspectives or additional capabilities could further strengthen the board. It should test whether the board’s skills, perspectives and leadership pipeline align with the company’s future strategy, not simply confirm that the current board is functioning adequately.

The Board Effectiveness Gap:

Executive perspectives reinforce the need for assessments to have more impact. In a recent survey of more than 500 C-suite executives conducted by PwC and The Conference Board, 90% of executives said there is room to improve the board assessment process. The most cited improvement was linking assessment results to board succession planning, followed by committing to post-assessment actions and conducting individual director assessments.

This is consistent with a broader tension in board effectiveness. Executives’ overall confidence in boards has improved, but they continue to identify barriers that are closely related to how boards operate: limited director bandwidth, slower reactions to emerging risks and difficulty keeping pace with digital transformation. These are not problems that can be solved only by adding a topic to the agenda. They require boards to examine whether their composition, cadence, information flow and engagement model match the pace and complexity of the business environment.

The Growing Role of Individual Director Assessments:

Individual director assessments are becoming a more visible marker of assessment maturity. They are also among the most sensitive elements of the process.

Many boards are comfortable evaluating the board as a whole. Fewer are as comfortable evaluating individual director contribution. Boards depend on trust, collegiality and the ability to deliberate candidly. Because directors are evaluating their peers, a poorly designed individual assessment can feel personal or punitive. It can also undermine board culture if feedback is vague, inconsistent or not handled appropriately.

Board effectiveness depends on the contributions of individual directors. The board may have the right skills on paper but may not be using them effectively. A director may have deep expertise but limited availability. Another may be fully engaged but no longer aligned with the company’s future needs. A committee chair may be respected but not moving the agenda forward. These issues are difficult to address through a full-board survey alone.

Individual assessments do not need to be adversarial. The most effective processes are developmental and forward-looking. They ask whether directors are prepared, engaged, constructive and able to contribute to the company’s evolving needs. They also provide a structured way to discuss committee assignments, leadership roles, director education, succession planning and refreshment.

This is particularly important as director capacity becomes a more central element of board effectiveness. Overboarding policies have become more common and stringent, reflecting investor concern that directors must have enough time to fulfill increasingly demanding responsibilities.

But numerical limits are only a starting point. A director’s actual capacity depends on more than the number of public company boards on which they serve. It also depends on other board commitments, committee leadership, executive responsibilities, the complexity of the companies involved, crisis demands, attendance and engagement.

Individual assessments can help a board move beyond assumptions, revealing whether directors have the time and focus needed for today’s board service demands.

From Evaluation to Action:

The most valuable assessment processes are those that extend beyond feedback collection. Directors may complete a survey, participate in interviews and review a summary of findings, but the process becomes more meaningful when those insights inform board structure and composition, committee leadership, agenda design and director development. In that sense, the assessment creates value only when it leads to action.

An effective assessment process should have a longer arc. Before the assessment begins, the board should be clear about what it wants to learn. Is the focus board culture, skills alignment, committee effectiveness, director contribution, succession planning, information flow or all of the above? The process should then produce a candid discussion of priorities and a manageable set of follow-up actions.

Those actions should be assigned, revisited and integrated into the board’s annual cycle. If the assessment identifies a need for more expertise in technology, cybersecurity or human capital, that should inform the skills matrix and succession plan. If directors believe meetings are too backward-looking, that should change agenda design. If committee workloads are uneven or overlapping, committee charters and reporting practices may need to be revisited. If individual director feedback reveals concerns about preparation, contribution or capacity, the board chair or lead independent director should have a process for addressing those issues constructively.

Independent facilitation can help, particularly when the board wants a more candid read on sensitive issues such as board culture and dynamics, individual director performance or refreshment. An external perspective can provide structure and objectivity while keeping responsibility for judgment and follow-through with the board.

What Strong Boards Will Prioritize:

The next phase of board assessments will depend less on whether a board has an assessment process and more on whether it uses the process to become more effective.

Three priorities stand out. First, the board should make the assessment more forward-looking. The process should evaluate how the board performed over the past year, but it should also ask whether the board is prepared for the next three to five years. Second, the board should include the right levels of analysis. Full-board and committee evaluations are important, but they may not be sufficient on their own. As expectations for directors rise, individual director assessments can provide a more complete view of contribution, capacity and development needs. Third, the board should build follow-through into the process. Assessment results should lead to decisions about agendas, committee structure, director education, board leadership, succession planning and refreshment. Without that connection, the process risks becoming a well-run exercise with limited practical value.

Boards are under pressure to be more agile, better informed and more engaged, while preserving the independence and judgment that make board oversight valuable. The board assessment is one of the few governance tools designed specifically to help boards examine themselves. Used well, it can help directors determine where the board is strong, where it is stretched and where it needs to evolve.

The most effective boards will not treat the annual assessment as a once-a-year governance ritual, but as part of an ongoing process of board development and continuous improvement. They will treat it as a strategic checkpoint — a disciplined way to help the board’s composition, culture and operating model continue to match the demands of the company it oversees. Read More.

Board Composition | Five Things The Strongest Boards Do Differently

Board effectiveness is being tested and defined in real time. AI, geopolitics, activism, sustainability, CEO succession, board refreshment, and stakeholder scrutiny are more interconnected, faster moving, and more visible than ever before. Yet, many board operating models, built for a more linear environment, have not kept pace with that change.

RRA’s 2025 Global Board Culture and Director Behaviors Study underscores that while directors understand the behaviors that matter, they don’t practice them consistently. This isn’t because boards lack awareness. It’s because effective governance now depends on whether the board has designed itself to make better judgment more likely: in how it spends time, leads discussion, uses expertise, evaluates itself, and prepares for uncertainty.

The strongest boards are doing five things differently to close these gaps.

1. They protect forward-looking time

Strong boards treat time management as a governance choice.

Financial results, operating updates, committee reports, compliance, and risk dashboards all matter. But when they dominate the meeting, the board’s role narrows from judgment to review, leaving even a technically informed board strategically underprepared.

The strongest boards push passive reporting into pre-reads and reserve meeting time for discussion. They ask: What assumptions are we making? Where are we overconfident? What decision will we wish we had debated six months earlier?

Their meetings are more forward-looking than backward-looking, more discussion than presentation, and more focused on solving problems than identifying them. Long-horizon topics such as AI, geopolitics, capital allocation, CEO succession, and supply chain resilience are not treated as offsite luxuries. They are built into the board’s normal rhythm.

2. They are stewards of productive disagreement

Over time, collegiality can harden into complacency. A board that never disagrees may not be aligned; it may be underperforming.

Highly effective boards understand that trust and tension are not opposites. Strong board leaders embrace this posture and move beyond facilitation to enable productive disagreement. They draw out quieter voices, prevent one director from dominating, test whether consensus is real rather than assumed, and help management hear challenge as contribution rather than opposition.

3. They build collective fluency, not single-issue governance

The question the most effective boards are asking is not, “Do we have an expert?” It’s, “Can the board as a whole exercise judgment on this issue?”

AI, cyber, geopolitics, sustainability, human capital, and regulatory complexity all require more fluency than many boards historically possessed. But expertise can become a delegation trap. Once a board has “the AI director” or “the geopolitics director,” the rest of the board often unconsciously lowers its own level of engagement and continued learning.

The strongest boards avoid that trap. They look for “T-shaped” directors who have both deep expertise and enough breadth to contribute across the agenda. They also build deliberate expert-access models: trusted advisers, regular education, rapid briefings when events shift, and scenario sessions led by people who understand the topic and the company’s decision context.

4. They address avoided conversations before they become forced conversations

Boards often avoid asking questions that relate to identity, status, and relationships. Is this director still contributing? Is the chair effective? Is the CEO succession plan strong enough? Does our composition still fit the strategy? Has the board become too deferential to a successful CEO?

These conversations are difficult for understandable reasons. A contribution conversation with a peer is not like giving feedback to a direct report. Discussing CEO succession can feel disloyal when the incumbent is performing well. Chair feedback can be especially hard when the chair controls much of the process through which feedback would surface.

Structure helps. RRA’s work notes that 43% of boards have never undergone an externally run board evaluation. At a time when director-by-director accountability is increasing, that leaves many boards without one of the most important mechanisms for surfacing contribution, leadership, and composition issues before outsiders do.

Best practice is to treat CEO succession as an evergreen discipline, frame director feedback as contribution and development before it becomes a removal conversation, and assess composition against future strategic needs, not past service.

5. They build agility as a board capability

The strongest boards are building the capacity to orient quickly when unfamiliar issues become immediate.

That starts with rethinking how risk is handled. Traditional risk maps and heat charts may look exhaustive, but they are often too static to help boards govern risks that move, compound, or spill across categories. Stronger boards are shifting the conversation from “have we reviewed the risk register?” to “which scenarios would most test the company, and how would we respond?”

Boards build agility through practice. They run scenario discussions, test strategic assumptions, clarify who would make which decisions under pressure, and adjust their cadence when the context requires it. For one large global technology company, that has meant a short standing board meeting every other Sunday so directors can approve time-sensitive deals and address matters requiring board action as AI investment activity accelerates. That model may not be right for most companies, nor should agility become a license for boards to drift into management’s role. The broader lesson: strong boards design their rhythms around the pace of the decisions they may need to make.

Leading boards also define early warning indicators and ask a harder question: What if critical suppliers fail? What if oil prices spike or tariff conflict worsens? What would have to be true for the company’s strategy, leadership plan, capital allocation thesis, or risk posture to break? This matters because risks no longer stay in their lanes. A geopolitical event may start as a market-access issue, then quickly affect supply chains, cyber exposure, regulation, talent, and reputation. Likewise with AI, which can uncover massive new advantages while also introducing operational risk, workforce disruption, litigation exposure, and competitive vulnerability.

The board’s role is not to manage each issue directly. It’s to ensure management is asking the right questions, testing the right assumptions, and preparing for decisions that may need to be made quickly.

The new standard for board effectiveness

Best-in-class boards don’t wait for the next crisis, activist letter, CEO transition, technology shock, or geopolitical disruption to discover whether they can operate differently. They are practicing these behaviors now. And that’s what separates boards that understand effectiveness from boards that deliver it. Read More.

Board Independence | Independent Directors Key To Fixing Governance Gaps

Sebi chairperson Tuhin Kanta Pandey advocates for a significant change in how independent directors operate. He stated that boardroom independence in India is often just procedural and does not lead to effective oversight. Companies need to move beyond mere compliance and foster diverse views and constructive dissent. The focus should be on improving board engagement quality, not adding more regulations. 

The Securities and Exchange Board of India (Sebi) chairperson called for a fundamental shift in how independent directors function, saying boardroom independence in India often remains procedural and does not translate into effective oversight. Companies must move beyond compliance-driven structures towards fostering diverse perspectives and constructive dissent within boards, said Tuhin Kanta Pandey at a corporate governance event organised by CII on Monday. The next phase of governance reforms should focus on improving the quality of board engagement rather than adding new regulatory layers, according to the Sebi chief. “Boards are well constituted, but not always equally effective. Information is available, but not always interrogated deeply,” he said. Advt Pandey said independent directors sit at the centre of this gap. While regulations have strengthened board composition and committee structures, independence should be viewed as a starting point rather than the end objective. “Independent directors are there not only for compliance and pointing fingers at management, but also to support and find solutions through accountability,” he said. Pandey’s comments come amid heightened scrutiny of corporate governance at HDFC Bank following the exit of its former chairperson Atanu Chakraborty, who cited incongruity in values and ethics. 

The Sebi chairperson said there is a wide divergence in how independent directors operate – ranging from those who actively challenge management and contribute to decision-making, to those whose roles are constrained by limited access to information and reliance on management narratives. “They are expected to provide oversight without being involved in day-to-day operations, challenge management while relying on management-provided information, and remain accountable without full operational visibility,” he said. Pandey said capacity building is the next frontier of governance reform, citing the increasing complexity of boardroom issues. Read More.

Corporate Governance | What Will AI Do To Corporate Governance?

The Singapore Governance and Transparency Index (SGTI) 2026 has taken place amid significant changes in the Republic’s capital market ecosystem. MAS’ announcement of the equities market review provided the impetus for much activity, from regulatory consultations and reviews to new listing rules and programmes aimed at revitalising the capital market. One focus of the discussion has been the importance of corporate governance in sustaining such a revitalisation.

Against this backdrop, SGTI 2026 has a mean score of 69.5 points out of a maximum achievable score of 143 points. The base score covers five dimensions: board responsibilities (35 points), rights of shareholders (10 points), ESG (environmental, social and governance) and stakeholders (20 points), accountability and audit (10 points), and disclosure and transparency (25 points).

The final score is derived from the base score and an adjustment for bonuses and penalties (see also box insert “How scoring for the Index is done”). Strongest performance is seen in disclosures relating to shareholder rights (mean normalised score of 85 per cent), followed by accountability and audit, and ESG and stakeholders (mean normalised scores of 71 per cent and 67 per cent respectively).

Rewards, returns and relations:

The results of SGTI show that there is significant room for improvement in disclosures relevant to shareholder value creation. This can be seen in three areas featured in SGX RegCo’s recent consultation: remuneration, dividend policy and investor relations. Due to Listing Rule 1207(10D), companies are disclosing the exact remuneration of directors and CEOs. However, just over half of the companies go further to disclose information on the link between the performance of executive directors (EDs) and key management personnel, and their remuneration.

As expected, there is a significant size effect. Seventy-three per cent of large-cap companies (defined as a market cap of more than S$1 billion) disclose information about the link between the performance and remuneration of their EDs and C-suite executives. This is notably higher than the 57 per cent for mid-cap companies (market cap of S$300 million to S$1 billion) and 51 per cent of small-cap companies (market cap less than S$300 million). A narrower gap exists between mainboard and Catalist companies, with disclosure rates of 58 per cent and 49 per cent respectively.

Disclosure of dividend payment policies is also low. Overall, only one-third of companies which paid dividends also disclosed their dividend payment policies. There is also a much larger difference between the two boards. Among the mainboard companies which paid dividends, 44 per cent disclosed their dividend payment policies, while for Catalist companies, this drops to 9 per cent.

A similar picture emerges with investor relations disclosures. Only 40 per cent of the companies have boards disclosing in the annual report the steps taken to solicit and understand shareholders’ views, for example through analyst briefings, investor roadshows or Investors’ Day briefings. Around half of the companies disclose having an investor relations policy to regularly convey pertinent information to shareholders. Again, both these indicators show a size and listing board effect.

An ecosystem in transition:

The work of the Equities Market Review Group is complemented by the ongoing review of the Code of Corporate Governance, exploring how the Code can be updated to strengthen governance and disclosures such that they remain material for stakeholders, while maintaining proportionate compliance requirements for companies.

SGX has had several consultations in support of the Review Group’s recommendations, including on shifting to a more disclosure-based regime and on requiring enhanced disclosures on remuneration, dividend, and investor relations policies.

More recently, an industry-led initiative has emerged in the shape of the Institute of Singapore Chartered Accountants’ (ISCA) Strengthening Financial Reporting Taskforce, which aims to identify how companies can be more effective in communicating their performance, risks, and long-term value.

With these initiatives still in progress or having recently concluded, we have decided to defer the incorporation of value-related indicators into the SGTI assessment. We had earlier announced our plans to introduce such measures for the 2026 assessment. However, the various reviews will establish new disclosure requirements and refined governance priorities. By timing our revisions after the review outcomes, we can ensure that our framework reflects the enhanced governance and reporting regime now emerging.

How scoring for the Index is done:

The Singapore Governance and Transparency Index (SGTI) evaluates companies on their corporate governance practices and disclosures, as well as the timeliness, accessibility and transparency of their financial results.

Beginning in 2017, Real estate investment trusts (Reits) and business trusts have been assessed as well. The SGTI is a joint initiative of CPA Australia, NUS Business School’s Centre for Governance and Sustainability (CGS), and the Singapore Institute of Directors, supported by The Business Times.

The SGTI score has two components: the base score and the adjustment for bonuses and penalties. The base score for companies contains five pillars: board responsibilities (35 points), rights of shareholders (10 points), ESG and stakeholders (20 points), accountability and audit (10 points), and disclosure and transparency (25 points). The aggregate of bonuses and penalties is incorporated to the base score to arrive at the company’s SGTI total score.

The SGTI also evaluates Reits and business trusts on similar criteria, but with added coverage on the unique nature of their operations. The base score for Reits and business trusts includes: questions in the base score for the SGTI (75 points) and additional questions in the base score for Reits and business trusts (25 points) that focus on structure, leverage, interested person transactions, competency of the Reit manager or trustee-manager, and emoluments.

A total of 458 Singapore-listed companies and 41 Reits and business trusts which released their annual reports and sustainability reports by May 31 were included for the SGTI 2026. The sources of information for SGTI assessment include annual reports, sustainability reports, websites, and announcements on the SGX website.

Linking governance to value: 

In the meantime, at CGS we have been reflecting on how to incorporate value into the SGTI framework. CGS is collaborating with ISCA on a study to identify what drives value, and how these drivers map to the current reporting system. We are starting with financial determinants, as these provide the most direct and measurable link between what companies disclose and the value they create for shareholders.

However, companies need not wait for the various initiatives to conclude. While allowance must be made for differences in sector and size, the results of SGTI show that considerable room for improvement remains. The SGX consultation on enhanced disclosures for value creation and investor engagement gives a clear indication of the direction ahead. Companies can position themselves for coming requirements by providing meaningful, decision-useful information on their governance practices and value creation.

There has been encouraging progress since the launch of the review of the equities market, with increased trading activity and investor interest. To help sustain this momentum, companies need to keep their house in order through robust governance and transparent disclosures. Read More.