Corporate governance is one of the less-sexy topics within corporate finance and asset management. After all, everyone wants to know about firms’ profitability metrics, new product lines, and growth plans. (1/n)
In contrast, issues such shareholder rights, board independence, and compensation schemes evoke yawns among all but the most nerdy analysts and researchers. What does “governance” really mean for a private corporation anyway? (2/n)
These matters appear to be best left to insiders, who may know best for how to run the business. But such matters are actually enormously important. There is a sizable literature that links strong corporate governance metrics to outsized returns. (3/n)
Indeed, @SGX recently promoted greater disclosure for one particular dimension of corporate governance: remuneration. With rising inequality, and C-suite execs earning many more multiples than the employees they oversee compared to the past, such transparency seems overdue. (4/n)
But Singapore actually has publicly-owned companies that aren’t publicly traded (wrap your head around that). In particular, our government investment entities are not listed on the stock exchange, and are not obliged to adhere to the same standards. (5/n)
This is despite the fact that they are (directly and indirectly) funded with public monies, and (indirectly) perform a public service. It seems reasonable that GIC and Temasek be paragons of corporate transparency. (6/n)
The model here is Norway’s Government Pension Fund (GPF). GPF publishes detailed annual reports that include all manner of information about the fund, including the salaries and names of senior management. (7/n)
Such disclosure allows GPF to be accountable, and allows the public to assess whether salaries are commiserate with performance (also published in detail). The report runs more than 160 pages and is chock-full of data (GIC’s is 100+, while Temasek’s is 60+). (8/n)
Such transparency appears to work. The investment fund recently announced that it is increasingly voting against large executive pay packages at companies that it owns, and is own top salaries are not egregious. (9/n)
In a response to a parliamentary question I posed on expanding remuneration disclosure, Minister Wong responded that the two entities were not subject to the same code of corporate governance, and did not commit to requiring them to do so. (10/n)
Instead, GIC and Temasek are “encouraged” to continually review whether there are more “meaningful disclosures” they can make. It strikes me that the corporate governance code already spells out what these are. #makingyourvotecount (n/n)
Postscript: You may read the full question and response here: mof.gov.sg/news-publicati…

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More from @jamuslim

15 Sep
Every year, I teach a course in international economics. In the first lecture of the course, I teach what is known as the Ricardian model: named after the 18th century economist, David Ricardo. (1/n)
The key insight then—as it is today—is that free trade between two countries allows each one to specialize according to what they can do relatively well. This is known as comparative advantage. (2/n)
In doing so, these economies can enjoy levels of consumption greater than if they chose instead to go it alone, and attempt to produce everything at home. This elegant, compelling argument underlies why economists generally favor free trade. (3/n)
Read 12 tweets
14 Sep
The term “debate” often evokes images of raucous speeches and lively verbal jousting. Alas, parliamentary debates (in this country at least) are often heavily structured, guarded affairs. (1/n)
For instance, to make a point, one has to be recognized by the Speaker. This preserves order and decorum, but it comes at the cost of stifling dynamic riposte, especially for a heated topic. (2/n)
Time constraints exacerbate the problem (Parliament has more issues to discuss than time allows). This was the case yesterday, when a few #workersparty MPs (myself included) were unable to raise supplementary questions before the end of question time. (3/n)
Read 12 tweets
12 Sep
For many Singaporean parents, one of the more stressful events is placing their child in a preferred primary school. What that preference is differs. For some, it is the alma mater; for others, a school offering certain academic options; for yet others, one near their home. (1/n)
It strikes me that securing a place close to home is a reasonably modest expectation. This is not guaranteed if the school is especially popular, of course (and parents understand that); but getting into a walking-distance neighborhood school seems eminently fair. (2/n)
Alas, in certain neighborhoods—especially #Anchorvale in #SengkangGRC, where I serve—the preponderance of families with young children has meant that many residents have been unable to place their kids in schools close to home. (3/n)
Read 8 tweets
1 Sep
Last week, @yalenus announced that it would be taking in its final class of students. The college—one of the first liberal arts schools in Asia—is set to close its doors in four years. It marks the end of a bold experiment. (1/n)
I suspect most Singaporeans would be apathetic to this development. While Yale has an easily recognizable brand name, it is, after all, an elite institution, which by definition caters to a very limited few. (2/n)
The idea of the liberal arts is also alien to most Asians. Asian universities tend to focus most on science, technology, and other professional fields that are perceived to contribute most to economic output (and yield jobs for graduates). (3/n)
Read 17 tweets
18 May
The government recently announced plans to form a nonprofit entity to take over the media businesses of Singapore Press Holdings. Many observers have offered their thoughts on the merits of this arrangement (including my #workersparty colleagues). (1/n)
I thought it would be interesting to examine the economics of the local media industry in a little more detail. While it’s not possible to cover all relevant aspects, a few issues did jump out at me. (2/n)
The Straits Times and its associated vernacular sister publications (Lianhe Zaobao, Berita Harían, etc) currently operate under the auspices of an effective monopoly conferred by the state; at the moment, only SPH has been permitted to operate as a newspaper company. (3/n)
Read 18 tweets
6 Apr
I first arrived in the United States with around 10 grand in savings, a box of economics textbooks, and a baggage full of dreams. Unlike many PhD students, I did not initially receive any financial assistance. (1/n)
So the first few months were especially rough. I found the cheapest room I could, traveled by bike, and ate a lot of frozen dinners. But I bled through the savings quickly, mainly because of costly out-of-state tuition fees. (2/n)
But I was very lucky. The family I lived with was exceedingly generous. I ate two meals with them each day, for which I paid only a fraction of the cost. They would invite me to their family holidays. They were kind and wise and supportive. (3/n)
Read 11 tweets

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