More than a third of retail investors in S'pore face problems exercising their rights: Survey

Straits Times

5 days ago

About a quarter of the respondents said they met challenges in accessing company financial reports and disclosures. ST PHOTO: LIM YAOHUI
More than a third of retail investors in S'pore face problems exercising their rights: Survey
SINGAPORE - More than a third of retail investors, or 37 per cent, experienced difficulties in exercising their rights, according to a new survey out on June 25.
The survey, which was commissioned in 2024 by the Securities Investors Association (Singapore), or Sias, included the responses of 197 people in a bid to track the progress of investors' rights in Singapore and see what more needs to be done.
Sias is the main investor-led organisation dedicated to investor education and the advocacy of retail investors' rights. It engages companies and regulators to improve corporate governance and transparency.
The survey was also conducted with support from the Singapore Institute of Technology (SIT) and the Singapore University of Social Sciences (SUSS).
Of the respondents who said they faced difficulties, 41 per cent felt their voices were not heard enough when companies made decisions.
Another 24 per cent said they met challenges in accessing company financial reports and disclosures.
Some 22 per cent also reported encountering difficulties when voting at shareholder meetings because of unclear procedures and a lack of information.
Lastly, 13 per cent said they experienced delays in receiving dividends and other things that shareholders are entitled to.
SIT Associate Professor of Accounting Kevin Ow Yong said: 'From an accounting and finance perspective, it is imperative that there are adequate safeguards to protect investors so as to improve and maintain investor confidence towards Singapore Exchange-listed companies.'
The report observed that there is room for further reforms to plug gaps in investor protection under the existing framework.
The opportunity for reform has also cropped up, with the ongoing review by the Equities Market Review Group, which was set up in 2024 to boost Singapore's equities market.
'While it is important for regulation to be right-sized in order to improve and increase the quality of listings in Singapore, this should not be at the expense of investor protection, which is important to support both retail and institutional investment in Singapore's equities market,' the report said.
Among the things investors wanted include having better mechanisms for investor redress and dispute resolution, and ensuring fair and equal access to information.
Investors also said they want more transparency in corporate governance practices and to strengthen safeguards against insider trading and market manipulation.
Strengthening shareholders' voting rights was also important to investors.
The largest proportion of investors felt that more can be done to make information more accessible.
The report noted: 'These respondents elaborated that they felt their rights were compromised due to a lack of communication about significant changes in business strategy and insufficient disclosure on company investments.'
For instance, one company did not inform investors about a major strategy shift, particularly after being inactive in one of its primary businesses for several years.
Shareholders then raised these concerns at annual general meetings, demanding clearer communication about the company's intentions.
'In this instance, the feedback led to improved communication, with the company directly addressing their concerns, leading to enhanced transparency and investor confidence,' the report said.
It noted that the fact that some respondents want greater transparency in corporate governance practices also indicates a growing demand for greater openness, accountability and clarity in how companies are managed and directed.
SUSS School of Law lecturer Lance Ang said: 'The recommendations in the study are particularly pertinent in light of the shift towards the 'disclosure-based regime' announced by the Equities Market Review Group in its ongoing review of the regulatory framework to attract listings.'
He added that a disclosure-based approach that forms the basis of informed investor decision-making must be supported by private and public enforcement of disclosure breaches.
These can enable investors to get compensation for losses, as well as ensure shareholders have access to information and investor education, he said.
SUSS School of Business senior lecturer Tan Eng Joo noted that the findings suggest that enforcement alone is not enough to empower investors, but that it is also encouraging that 'no single area stands out as particularly deficient'.
'This reflects a balanced approach within existing investor protection mechanisms, supporting efforts to build a resilient and inclusive capital market where all investors feel heard, engaged, and safe,' Dr Tan said.
Sias president David Gerald said that over the past decade, the organisation has seen a shift in Singapore where more investors are more proactive in asserting their rights.
'Through our persistent advocacy, constructive dialogue with regulators and listed companies, and empowering investors with knowledge, Sias has helped shape a more engaging investing community,' he said.
'This journey reflects our unwavering belief that protecting investor rights is fundamental to building trust and resilience in our capital markets.'
Sue-Ann Tan is a business correspondent at The Straits Times covering capital markets and sustainable finance.
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