A Member Firm of Andersen Global

Company Shares and Shareholders Roles and Obligations in Singapore

One of the most important players in the business world are the shareholders, the contribute highly to the operations of the institutions. In Singapore, the companies treat all shareholders they have with the utmost respect, equity, and fairness. They encourage them to provide their views on different matters relevant to their company’s operations.

Company Shares and Shareholders Roles and Obligations in Singapore

One of the most important players in the business world are the shareholders, the contribute highly to the operations of the institutions. In Singapore, the companies treat all shareholders they have with the utmost respect, equity, and fairness. They encourage them to provide their views on different matters relevant to their company’s operations.

In Singapore, companies get registration approval after paying the $1 paid-up capital, a shareholder, at least one share, a registered address, and one resident director. The last two must hold citizenship in Singapore. Notable, shares in companies in this region do not only specify ownership in the company. Shareholders get different responsibilities, obligations, and rights as well.

This post will cover further details on these factors and shareholder roles in Singapore companies.

Who are Shareholders?

Shareholders are business entities or individuals who lawfully own one or multiple company shares within a business. They are not part of the company’s base operations, and their share value increases with association with the business’ growth. The shareholders can exercise their rights and give opinions on the company’s conduct and policies they have the shares.

They have multiple responsibilities within the company, such as voting on internal operations-related debates. Plus, they have the power to advocate and even propose certain resolutions for their company.

The shareholders in companies cannot use their assets like profit quantity or properties, unlike creditors. The latter gets the first claim for any of the company’s assets. For example, if there is no property left following the creditors’ claims, shareholders cannot get any of the company property during dissolution.

Typically, the level of claim and power a shareholder can enjoy depends on the number of shares they have in the company.

Legal Jurisdiction for Shareholders Regulations in Singapore

In Singapore, the regulations regarding the engagement and rights of shareholders fall under the governance of non-statutory and statutory instruments besides the main legal system.

The main non-statutory instruments are multiple and include options like the Listing Manual (Listing Manual of the Singapore Exchange) and the Governance Code (Singapore Code of Corporate Governance, 2012). On the other hand, the statutory instruments are the SFA or Securities and Futures Act and CA or the Companies Act in Singapore.

Roles and Obligations of Shareholders

There is a wide range of responsibilities that fall under the jurisdiction of the company shareholder role in Singapore.

Shares-Related Payments

One of the primary functions of companies’ shareholders in Singapore is to complete the whole shares-related payment. Shareholders can handle partial payments in different periods. However, when the company requests the payment completion of these shares, shareholders need to complete it as soon as possible.

One must pay the full sum that was originally allotted to them during the initial period of share purchase. The exact details of these transactions, like the payment method and terms, can differ for each shareholder.

For example, if a listed company uses a securities brokerage company to purchase shares, they would discuss the payment terms with these professionals. Non-listed companies must add the terms for share payment in a written shareholder agreement.

Different Types of Approvals

The shareholders of companies in Singapore are responsible for handling different types of voting and approval matters. They are directly in touch with the company’s board of directors and give their opinions and decisions regarding company matters. Here are the different types of tasks they handle.

Declaration of Dividends approval

The shareholders attend the Annual General Meeting or AGM. If the directors give their Declaration of Dividends recommendation, shareholders decide to decline and accept the approval.

General company operations-related resolutions

Different internal operations-related incidents and concerns are discussed at AGM. Shareholders vote as per their personal opinion on the matters focused on improving the company’s financial status and efficiency rate.

Approval/disapproval of constitutional-level modifications in a company

Shareholders vote on motions related to changes in the constitution of the company. This step is complex, and it is important to process with caution since many crucial elements fall under these resolutions. They include the aims of the company, the salary rate of directors, and concerns regarding directors’ roles.

Decisions related to new share purchase

The existing shareholders vote on the application of new shareholders. One must carefully conduct a complete evaluation of the company in accepting share purchases and the disadvantages/advantages of the new subscribers.

Voting about the sale of the planned assets of the firm

The shareholders provide their approval or disapproval for contracts about the sale or purchase of company assets. They judge based on the value and worth of the sale. Listed companies need the approval of:
In the case of non-listed companies, shareholders can vote in this matter if the company sells its full assets. However, if the transaction crosses a particular limit, the shareholders’ approval is necessary.
Want to learn more about Company Shares and Shareholders Roles and Obligations in Singapore?
Speak to one of our experts today.

Appointment of positions

The shareholders are active participants in the AGM that the Singapore companies hold. They must also attend EGM or Extraordinary General Meeting. At these events, the shareholders give their opinion on the company management to the board of directors.

Director’s Appointment

Shareholders can voice their opinion through votes on the appointment of new directors. These professionals handle the main management work for the company. So, the shareholders decide on a majority basis after careful evaluation of the qualifications and competency of the applicants.

Director’s Demotion

Like appointing new directors, the shareholders vote on the removal of the professionals as well. During the general meetings, they judge the complaints (if any) and details about the accusation of misconduct or underperformance. Since the board of directors is exempt from this voting, shareholders give their unbiased decision.

Removal or appointment of directors in private vs. public company

In private-owned companies, the shareholders’ decision to remove errant or underperforming directors is up for getting a challenge. Changes to the constitution of the company can modify this decision.

For public companies that have over 50 shareholders and zero share transfer restrictions, the Company Act states that provisions in the service contract of directors or the constitution can claim to downplay the directors’ approval/demotion action.

Policing Misdemeanours

In some cases, companies notice violations, but they avoid taking the matter to legal authorities. Here, the shareholders have the option to bring legal action on behalf of the company. This process is called derivative action. Alternatively, sometimes, directors of the company can use their role to do actions that harm the structure or operations of the company.

For example, a director may take financial incentives from another firm privately, causing a disadvantageous transaction for the company. At this point, the company should pass a resolution for legal action in response to this unlawful action.

If the director in question is a majority shareholder within the company, the organization can disregard or fail to pass any disciplinary actions against them. This is because this director would hold majority voting power.

At this point, the general shareholders can take legal action using the derivation action provision against the direction, as mandated under the CA rules.

Handling Communications for the Company

Another crucial obligation for the shareholders is to handle many communication matters for the company. They read and even respond to external queries on time. One of the main reasons for this is the close association of the shareholders with the board of directors.

For example, after a resolution on approval of shares gets accepted at the AGM meeting, the applicants get the information about the general mandate. The company can also choose to raise its funds via a Rights Offer. Here, they offer new shares to their current shareholders.

If an individual with the shares in the company does not respond to this notice within the deadline, the company makes the assumption that they are not interested in subscribing. After that, they cannot opt for the new shares, or their current status can get dissolved.

The shareholders conduct and handle proper communication regarding such matters. They also take part in EGM, which occurs during special circumstance situations. These include cases like a takeover offer for a company. In case the shareholders do not respond to this information on time, they cannot vote on the resolutions.

Your vision, our mission.
Let's discuss

Updated Information Relay

The shareholders have to notify their company with the shares about all changes in their information. They have an obligation to keep the firm informed on up-to-date details, like new contact information. These are important to add in key documents like bulletins, annual reports, and meeting announcements. Inaccurate information can cause errors, so it is important to avoid them.


For the proper functioning of companies in Singapore, the shareholders contribute highly to the resolutions and various decisions. Some responsibilities may differ for the shareholders in terms of their company type, like private or public enterprise, company structure, or industry sector. However, they hold standard obligations like voting power and advisory role.
A Member Firm of Andersen Global

Need Assistance?

Get In Touch

We appreciate your interest in IMC and are eager to address your needs.

To ensure we address your needs accurately and promptly, please fill out this form. This will help us in identifying and connecting you with the appropriate team of experts in our organization.

We take pride in our responsiveness and aim to get back to you within a span of 1-2 business days. Your journey towards solutions starts here.

Companies we have worked with

Let's Talk