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Companies Act in Singapore

If you are a Director or appointed to be a Director of any company in Singapore, listed or private, you got to read this.

“Section 156 of the Companies Act, directors and CEOs are required to disclose the nature, character and extent of their interests in transactions, or their holding of property or offices where a conflict of interest might arise, among other things, as s0on as practicable.”
(Source extracted from Business Times)

The penalty for the above breach is either one year’s jail or a $5,000 fine. That is not inclusive of the legal/defence fees involved when you are charged in court. All these will likely come out from your own pocket as these are your disclosure related duties as a director.

This is just one example of a duty of a director under the Companies Act. And I guess no one will actually be well versed in the Act inside out with such busy schedule at work!

If you are Director of a company, it is good to manage these financial risks using a Director’s & Officer’s Liability Insurance (D&O Insurance). Or before you agree to be a Director, please check with your company on your coverage!

It is also good to invest in such policies if you are a stakeholder of a company looking to attract talented directors.

#cksfinancial #CEO #boardroom #startups #businessinsurance

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