Citywire - For Professional Investors

Register to get unlimited access to all of Citywire’s fund manager database. Registration is free and only takes a minute.

Singapore investors look to CEOs for financial accountability

Surprise disclosures or restated financial statements were viewed especially poorly, according to a study by BlackLine and Censuswide.

Singapore investors look to CEOs for financial accountability

Investors in Singapore believe that CEOs should be held accountable for a company’s financial reporting errors, new study reveals.

BlackLine in partnership with Censuswide surveyed 760 institutional investors globally to gauge their confidence in portfolio companies. Out of which, about 100 investors are based in Singapore, with the remaining spread across the UK, US, France, Germany and Australia.

According to the survey, 99% of Singapore investors held CEOs directly responsible for ensuring financial data and reporting accuracy. Only 51% felt that CFOs should be held to account.

Fort-six percent said they become ‘frustrated when companies cannot communicate who is ultimately responsible for signing off on financial reports,’ further reducing investors’ trust.

Surprise disclosures or restated financial statements were viewed especially poorly, with 99% of investors revealing they would be adversely impacted if a company misreports its finances.

Almost half of investors in Singapore are concerned by this lack of transparency. The study found that the status quo is not sustainable in the longer term, particularly in unpredictable periods created by Covid-19.

In fact, corporate governance has come under extensive scrutiny in recent months. There’s been a lot of investor attention on how companies are able to successfully navigate through the current crisis, fund managers have said.

Meanwhile, 89% of investors in Singapore agreed that real-time visibility into finances is critical if companies want to stay competitive in the next 12-18 months.

‘Coming from a country known for its rapid adoption of technology, it’s no surprise that investors in Singapore are technologically savvy and rely heavily on real-time data and insights for accountability and transparency,’ said Terry Smagh, BlackLine’s senior vice president and general manager for Asia Pacific and Japan.

‘As companies focus on recovery and realignment, we will likely see a pivot toward technologies that automate and streamline financial reporting processes to build more agile teams. Such tools will not only help to instil trust in investors but also internal stakeholders as well, especially during uncertain times,’ he said.

Almost 70% believe artificial intelligence and machine learning will lead to greater accuracy and transparency in accounting and reporting.

A further 61% also believe AI-driven bots will one day be able to calculate the best investment opportunities, the study found.

Share this story

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Share this story

dot
dot
dot
Read More
dot