The company discloses in its annual report all forms of remuneration and other payments and benefits, paid by the company and its subsidiaries to directors and key management personnel of the company. It also discloses details of employee share schemes.
A. Explanation

This Provision seeks disclosures of all the forms of remuneration of directors and KMPs, including the details of employee share schemes.

Practice Guidance 8 sets out the various forms of remuneration, which include base/fixed salary, variable or performance-related income/bonuses, benefits in kind, stock options, share-based incentives and awards, and other long-term incentives.

Employee share schemes are usually encouraged as they align the interests of both employees and shareholders. However, these schemes can affect the holdings of existing shareholders (for example, they are diluted when new shares are issued), or the amount of profit available for distribution to shareholders (for example, if share options or purchases are exercised at a discount relative to the market price).

Full disclosure of employee share schemes thus allows shareholders to make appropriate assessments and ask pertinent questions. Practice Guidance 8 sets out the extent of these disclosures:

  • The potential size of grants.
  • The methodology of valuing stock options.
  • The exercise price of share options granted and outstanding, and whether it was at market or otherwise on date of the grant; and market price on date of exercise.
  • The vesting schedule.
  • Justifications for all the terms adopted.
B. Practice Guidance


C. Related Rules and Regulations
  • SGX Listing Manual - Part VIII, Chapter 8: Share Option Schemes or Share Schemes.
  • MR 704(29) and CR 704(32): Employee Share Option or Share Scheme.
  • MR 1207(16) and CR 1204(16): Annual Reports (Employee Share Option Scheme).


D. CG Guides
  • RC Guide 5.8: Communication and Ownership Guidelines [Equity-Based Remuneration].
  • RC Guide Appendix 5I: Summary Plan Rules for a Typical Company Listed on SGX [Equity-Based Remuneration].
  • RC Guide Appendix 7B-1: Pay-for-Performance Analysis.
  • RC Guide Appendix 7C: Sample Remuneration Framework Disclosure.
  • RC Guide Appendix 7E: Sample Communication to Shareholders in Annual Report.


E. Related Articles




eGuide to CG Code
Definition of Corporate Governance
History and Structure of the Code
Role of the Board
Role of the Chair
Focus on Long Term and Sustainability
Revised Code Structure and Approach
Mandatory Principles
Provisions and Variations
Thoughtful and Meaningful Application
Board Matters
Principle 1
Provision 1.1
Provision 1.2
Provision 1.3
Provision 1.4
Provision 1.5
Provision 1.6
Provision 1.7
Principle 2
Provision 2.1
Provision 2.2
Provision 2.3
Provision 2.4
Provision 2.5
Principle 3
Provision 3.1
Provision 3.2
Provision 3.3
Principle 4
Provision 4.1
Provision 4.2
Provision 4.3
Provision 4.4
Provision 4.5
Principle 5
Provision 5.1
Provision 5.2
Provision 5.3
Remuneration Matters
Principle 6
Provision 6.1
Provision 6.2
Provision 6.3
Provision 6.4
Principle 7
Provision 7.1
Provision 7.2
Provision 7.3
Principle 8
Provision 8.1
Provision 8.2
Provision 8.3
Accountability and Audit
Principle 9
Provision 9.1
Provision 9.2
Principle 10
Provision 10.1
Provision 10.2
Provision 10.3
Provision 10.4
Provision 10.5
Shareholder Rights and Responsibilities
Principle 11
Provision 11.1
Provision 11.2
Provision 11.3
Provision 11.4
Provision 11.5
Provision 11.6
Principle 12
Provision 12.1
Provision 12.2
Provision 12.3
Managing Stakeholder Relationships
Principle 13
Provision 13.1
Provision 13.2
Provision 13.3
Practice Guidance
Board Roles and Director Duties
Board Composition and Guidance
Chairman and CEO
Board Membership
Board Performance
Procedures for Developing Remuneration Policies
Level and Mix of Remuneration
Disclosure on Remuneration
Risk Management and Internal Controls
Audit Committee
Shareholder Rights and Engagement
Engagement with Shareholders
Managing Stakeholder Relationships
eGuide Glossary

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