Raymond Cheung
Chartered Actuary · CRO · Board Adviser · Singapore
Independence in the structural sense — no business relationship, no family connection — is not the same as independence in the governance sense. The boards that get the most value from their independent directors understand this distinction. Most do not.
Singapore's corporate governance code sets out clear criteria for independence — the absence of relationships that might compromise an independent director's ability to exercise objective judgement. These criteria are important, and getting them right matters. But structural independence and genuine governance independence are not the same thing, and most board nomination discussions focus almost entirely on the former.
I have sat across from a number of boards — as an adviser, as someone being assessed for a board role, and as someone observing board dynamics from the risk committee chair — and what I observe is that the independent directors who provide the most governance value are those who exercise independence of thought and challenge, not just independence of relationship. Those who provide the least are often technically independent but effectively deferential — they have no problematic relationships, but they also rarely push back.
What governance independence actually requires
- Domain expertise: an independent director who cannot understand what management is presenting cannot challenge it. Genuine independence requires knowing enough about the business, the risk environment, or the technical domain to ask the right questions.
- Willingness to slow things down: the most governance-valuable independent directors are those who are willing to be the reason a decision is reconsidered — even when that creates friction with management and the chair.
- A perspective management does not have: the value of an independent director is not replicating what management already knows. It is bringing a perspective — from a different sector, a different discipline, or a different stakeholder lens — that challenges the assumptions management has normalised.
- Prepared engagement: independent directors who read the board papers thoroughly, come prepared with questions, and follow up between meetings provide qualitatively different governance from those who engage primarily during the meeting itself.
“Independence is not a negative quality — the absence of conflicting interests. It is a positive one: the presence of an independent mind that management has to genuinely account for.”
What boards should be looking for
When I advise nomination committees, I push them to assess candidates not just against the negative criteria of independence but against the positive criteria of governance value. What specific expertise does this director bring that the board currently lacks? In what situations in their career have they challenged a management decision and been right to do so? What is their track record of actual challenge — not just attendance and approval?
The boards that work best are those where the independent directors are genuinely contributing expertise and independent perspective — where management comes to board meetings expecting to be challenged and finding that useful, not adversarial. Building that kind of board requires a more rigorous nomination process than most Singapore-listed companies currently apply.
Common Questions
What makes a good independent board director in Singapore?
Beyond the structural independence requirements under the Singapore Code of Corporate Governance, an effective independent director brings domain expertise relevant to the company's risk environment, a track record of constructive challenge of management, and a perspective that is genuinely different from what is already around the table.
How many independent directors does an SGX-listed company need?
Under the Singapore Code of Corporate Governance, at least one-third of the board must be independent directors. For companies where the chairman and CEO are the same person, or where the chairman is not independent, at least half the board must be independent.
About the author
Raymond Cheung is a Chartered Actuary, C-suite executive and board adviser with more than 20 years of experience across Asia in risk management, insurance, ESG and corporate governance. He is the CEO of CER Consultancy and an accredited trainer at SMU Academy and the Singapore College of Insurance.