Published April 22, 2009

Singapore's board of busy directors

Study shows there are 51 who each sit on the boards of at least 6 listed firms

By JAMIE LEE

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(SINGAPORE) While most directors here sit on a single company board, there is a small, busy group that has its hands full, with multiple directorships.

Some 84 per cent of directors in Singapore-listed companies hold just one seat, according to a study of 3,816 directors by National University of Singapore's Corporate Governance & Financial Reporting Centre (CGFRC).

The study is based on data from annual reports published between Jan 1, 2008 and Dec 31, 2008.

Some 14.5 per cent of directors hold between two and five positions in listed companies.

This leaves less than two per cent of directors - 51 individuals in all - who sit on least six company boards.

Most of the popular candidates have either government links or have accounting backgrounds.

For example, among the 16 directors who have eight or more posts, 10 are former or current members of Parliament (MPs), or former civil servants.

The busiest of the lot appears to be Wang Kai Yuen, who tops the list with 12 directorships.

Dr Wang, a former MP, holds posts at ComfortDelGro Corporation, Xpress Holdings, Cosco Corporation and China Aviation Oil among others. He was unable to comment by press time.

Related link: Click here for the list of directors sitting on at least 2 boards

Next on the list of busy directors is Er Kwong Wah, who is on the board of China Sky Chemical Fibre, China Essence Group as well as Cosco, and had served more than 25 years in the civil service in ministries such as defence and education.

Another popular candidate is Lien Kait Long, a trained accountant, who is an independent director of Kian Ho Bearings and PSC Corporation.

Other notable names include Chng Hee Kok - the former MP who was fined in 2007 for breaching the Companies Act after he failed to disclose his beneficial interest in a company known as Stoval Technologies Pte Ltd to NTUC Club - John Chen, ex-MP for Hong Kah GRC, as well as Ong Kian Min, Drew & Napier lawyer and the current MP for Tampines.

Mr Ong did not respond to BT's queries via e-mail.

Chua Eng Chiang, chief executive of the Singapore Institute of Directors (SID), told BT that while there may be a number of individuals who hold many directorships, that is not an indication of waning corporate governance levels here.

'The SID's position has always been that while there should be a limit to the number of directorships that an individual can and should hold, it is for the individual director and the board that he or she serves on to assess whether he or she is able to discharge his duty as a director effectively and to make that call.'

But Mak Yuen Teen, co-director of CGFRC, said that having 'super busy' directors is a concern.

'While it looks like a small number of directors who have many directorships, the busy directors actually sit on quite a number of companies,' he told BT.

Prof Mak added that some of the busy directors tend to sit with other busy directors on the same boards.

'This suggests that there may be a form of network among some of the busy directors. Some may be bringing each other onto different boards and they may not be thinking and acting independently because they know each other so well,' he said.

Prof Mak also noted that the popularity of former civil servants as board members is 'difficult to understand'.

'With due respect, I do wonder if they are there because of the good reputation of our government and civil service, and companies wanting to capitalise on this, than because of their perceived independence, personal competencies or commitment,' he said.

'I believe some companies are trying to window dress their boards with people who seem credible, but they do not care too much about the actual ability of the individuals to contribute to the company as independent directors,' he added. 'I would scrutinise such companies more closely.'