Our Head of Asset Recovery & International Enforcement and Deputy Head of Commercial & Corporate Disputes, Wendy Lin, is a member of the Singapore Academy of Law (SAL)’s Law Reform Committee (“Committee”). In that role, Wendy served as Chair of the Committee’s Subcommittee on Directors’ Duties (“Subcommittee”) which recently published a report on the Codification of Directors’ Duties in Singapore.
The report considers whether Singapore should amend its Companies Act 1967 (2020 Rev Ed) to codify directors’ duties, or at least set them out more comprehensively, whether within the Act or elsewhere, to provide directors with greater clarity and guidance on the nature and scope of their obligations. The report recommends that a review be undertaken to consider whether a combination of the approaches adopted in the UK and Australia, where, respectively, directors’ duties are set out at length in statute and breaches of these duties attract civil penalties, should be adopted in Singapore to enhance the clarity and accessibility of directors’ duties but without necessarily expanding the scope of criminal liability for breach. It further recommends that pending such review, consideration be given to clarify the duties currently set out in sections 157(1) and (2) of the Companies Act along the lines of their equivalent provisions in the UK and Australia in the interest of providing more clarity and guidance to the public and laymen directors, and provides a draft annex to the existing Form 45 (Consent to Act as Director and Statement of Non Disqualification to Act as Director) and Form 45A (Consent to Act as Director and Statement of Non Disqualification to Act as Director With Permission of Court or/and Written Consent of Official Assignee) in the Companies Regulations. The proposed annex will elaborate on and clarify directors’ duties set out in sections 157(1) and (2) of the Companies Act, and require prospective directors to acknowledge that they are aware of and understand these duties before taking up their appointment.
The other members of the Subcommittee are Chew Xiang, Daniel Choo, Christopher Koh Theng Jer, Associate Professor Pearlie Koh, Leow Jiamin, Vikram Rajaram, Allen Sng, and Wenzhao Zhuo. The Subcommittee was also assisted by our Senior Associate Sean Koh and Associate Zhan Xiangyun.
Click here to read the full report.