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Author: SGX   |   Latest post: Mon, 26 Sep 2022, 4:43 PM


REIT Watch - SGTI 2022 Shows More S-Reits Reporting Non-financial Metrics

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REIT Watch - Top 10 Reits and property trusts in the SGTI 2022

S-Reits and business trusts see an improvement in their Singapore Governance and Transparency Index (SGTI) 2022 scores, increasing marginally to 85.3 points from 85.0 last year.

In the Reits and business trusts category, Ascott Residence Trust retained its top position with an overall score of 110.6. Ascendas Reit overtook Far East Hospitality Trust this year with 108.7 points, with the latter ranked third at 107.4 points. Lendlease Global Commercial Reit, whose score improved 6.0 points, made it to the top 10 this year.

Findings by the SGTI highlighted year-on-year improvements in practices for interested person transaction (IPT) and performance fees. Moreover, the proportion of trusts that had a minimum of 3 full-time representatives with at least 5 years of relevant management experience improved from 91 per cent to 98 per cent. SGTI notes that Reits and business trusts, given their unique business models, are subjected to additional guidelines such as the Code on Collective Investment Schemes, hence complementing the existing SGTI framework (e.g. leverage, structure, IPT, competency of manager, fees).

Results pertaining to sustainability-related disclosures were also commendable with 84 per cent of trusts disclosing their non-financial performance indicators compared to 77 per cent last year.

Overall, the mean score of the Reits and business trust category increased by 0.3 points year on year and the mean bonus points for good disclosure practices increased by 0.7 points to 19.2 points. Mean penalty points for poor disclosure practices, such as discrepancies in corporate announcements, rose 0.3 points to 5.4 points.

The top 5 Reits and property trusts with the most year-on-year improvements in overall scores include: Keppel DC Reit (+17.5 points), Frasers Hospitality Trust (+13.4 points), Sabana Industrial Reit (+13.3 points), First Reit (+12.0 points) and Dasin Retail Trust (+9.7 points).

About SGTI

The SGTI is an annual assessment of Singapore-listed companies on their corporate governance disclosure and practices, as well as the timeliness, accessibility, and transparency of their financial results announcement. With increased scrutiny on corporate stewardship, SGTI offers stakeholders insights into the accountability and transparency of companies.

It is a collaboration among CPA Australia, NUS Business School's Centre for Governance and Sustainability, and the Singapore Institute of Directors, supported by The Business Times.

The SGTI 2022, which assessed companies based on their annual reports for Financial Year 2021 released by May 31, 2022, is divided into 2 categories – general category (489 companies) and the Reits and business trusts category (44 trusts).

The mean overall scores of both categories reached all-time highs of 70.6 (general category) and 85.3 (Reits and business trusts category) respectively, with improvements across all 5 pillars of the assessment framework. 

REIT Watch is a weekly column on The Business Times, read the original version

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