What Nominating Committees should consider for

Background On 13 December 2020, SGX RegCo has issued a regulatory column to issuers on what Nominating Committees should consider when faced with a situation where directors of listed issuers are being called in for questioning by police investigators. A summary of the regulatory column is provided below.

1. Nominating Committee’s Obligations a) Fiduciary Duties. Under Rule 720(1), issuers must ensure under Mainboard Rule 210(5)(b) or Catalist Rule 406(3)(b) that directors comply with the character and integrity requirements on a continuing basis. b) Independent Assessment. It is the responsibility of the company’s Nominating Committee (NC) to disclose its independent assessment on the continued appointment of the director in compliance with Rule 720(1) read with Rule 210(5)(b) (or the equivalent Catalist rules 406(3)(b)). This must be done via an announcement on SGXNet or the company’s annual report and Notice of AGM when the director is up for re-election. c) NC Assessment. When a director, or Board is under investigation, the NC must rigorously satisfy itself as to whether the allegations against the directors and conditions or restrictions imposed by the regulatory authority or government agency, would cast any doubt on their suitability or continuing ability to act as directors; or more crucially, affect shareholders’ confidence in the company. The NC should also consider whether any measures need to be undertaken to safeguard against risks associated with the directors’ continued appointment.