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Promoting good governance and accountability in our charities

Speech by Mr Edwin Tong, Minister for Culture, Community and Youth & Second Minister for Law, at the Charity Governance Conference on 21 Nov 2023

Ms Theresa Goh, Chairperson, Charity Council 

Mr David Gerald, Founder, President, and CEO of Securities Investors Association (Singapore),

Associate Professor Lim Lee Ching, Dean of S R Nathan School of Human Development, Singapore University of Social Sciences,

Ladies and Gentlemen


1.     A warm welcome to all.

2.     I am delighted to see so many individuals here today. This underscores the importance of the topics that we are going to be discussing today, and the importance that you ascribe to sharing thought leadership, experience, ideas and innovation with one another.

3.     I’d like to start by making a few words of thanks.

4.     First to David and his team from Securities Investors Association (Singapore) (SIAS) for  supporting and co-organising this year’s conference with the Charity Council.

(a)      Your team has helped us to reach out to a much wider audience, with more than 700 charity representatives here with us today.

(b)      Some of your board members have also stepped up to become moderators and panelists for the Conference. The charities will benefit greatly from your very practical insights and experiences, bringing greater impact to the community and charity sector.

5.    I want to also make a special thanks to the speakers and panelists for so generously coming forward to share your experience and to share your thought leadership.

6.     This is really going to be an important and impactful conference.

7.     I would also like to thank Singapore University of Social Sciences (SUSS) for continuing to be this year’s conference knowledge partner.

(a)      Your expertise and commitment to education have been a tremendous asset to our charity sector.

(b)      I think we need to make education a bedrock and a lifelong endeavour. We need to think of how we can constantly upgrade ourselves, how we keep ourselves knowledgeable and plugged into developments around the world.

8.    Finally, I would also like to take the opportunity to acknowledge the 9th Charity Council for your efforts in promoting good governance and accountability in the charity sector.

Currencies of Trust

9.     I think it really goes without saying that openness, transparency, strong governance, accountability, these are all not just good to have concepts, but they are really the currencies of trust.

10.     And without these currencies of trust, it will be very difficult for charities to have a good, open, working, beneficial relationship with the public.

11.     It is really important that we stand by these principles and as we think about the different issues that we are confronted with today, and look at how we can remodel ourselves and improve, we must always keep these concepts as the foundational bedrock of what we want to achieve.

12.    This morning I will speak on a few changes that we would like to see that will enhance our framework for good governance.

13.    As I speak about them, you will see that what we are trying to do over the years as our charity sector matures, with more self-governance, with more rules of regulation, with lifting the standards overall of charities, we hope to be able to see a little bit of flexibility at the margins, so that the charities can be innovative and have a little bit of working room to start thinking of what they want to do out of the box.

14.     I wanted to end my thanking section by also acknowledging the many who have stepped forward – stakeholders in the sector, those who have more experience or different experiences in the sector –  to share ideas with us on how to strengthen Singapore's role as a philanthropy hub.

Achieving the highest governance standards is essential for charities to build trust and credibility with their stakeholders

15.     Let me first start with the fundamental point about achieving high governance standards.

16.     With a maturing charity landscape and coupled with our efforts over the years to strengthen trust and promote good governance in the charity sector, the Government has moved towards a more balanced disclosure regime for house-to-house and street collections for registered and exempt charities.

(a)      This new regime aims to strike a balance between the need for transparency and accountability, and the need to minimise the administrative burden on charities.

(b)      We recognize that sometimes in trying to put top-down rules governing charities, while it is very good, but at the same time it can cause a big burden on smaller charities. We are very mindful of this, very conscious, and what we want to do is to try to strike a very good balance achieving both at the same time.

(c)      Therefore, it is important that there are still safeguards to help members of the public make informed decisions about their donations.

(d)      Remember that I said that trust with the public is one of the key foundational pillars of a charity’s relationship with the public

(e)      Charities are self-encouraged to put in place adequate processes and internal controls to ensure compliance with the disclosure regime when conducting public fund-raising appeals.

(f)        By working together, we can ensure that charities will be able to operate effectively and efficiently, while also maintaining the trust and confidence of the public.

Philanthropists seek to contribute more as they see opportunities to create meaningful change

17.     Second, the philanthropy landscape in Singapore has been evolving over the years.

(a)      There is a growing interest in impact investing and social entrepreneurship, with an emphasis on greater collaboration and deeper partnerships and an increasing focus on diversity, sustainability, and inclusivity.

18.    In this landscape, grantmakers play a significant role in the overall philanthropic sphere and contribute to the national drive to build a more caring and inclusive Singapore.

19.     They support charities by providing financial support, advocating for change, and providing guidance and expertise in many cases.

(a)      For example, Quantedge Advancement Initiative, has supported our local university to conduct research on climate adaptation and develop essential tools that enable organisations to make informed decisions on when and how nature-based adaptation measures are important in mitigating the upcoming and ongoing climate threats.

20.     As part of developing Singapore as a regional Philanthropy Hub, the COC’s office will be making changes to the existing Guidance on Regulation of Grantmakers that includes the following:

(a)      Retaining the current guideline of requiring Grantmakers to “apply some of their funds in Singapore”, without hardcoding a minimum percentage.

(b)      Allowing the conduct of non-grantmaking activities, limited to 10% of the Grantmaker’s activities and subject to certain safeguards; and

(c)      Allowing disbursements through non-grant instruments (e.g., social impact bonds, loans), limited to 10% of the Grantmaker’s activities and subject to certain safeguards.

21.   These changes help to promote the good work of grantmakers, giving them a little bit of flexibility, as I mentioned at the outset, but still fundamentally maintaining the core principle of transparency, governance, and strong sense of accountability.

22.     These changes will clarify the parameters of the scheme and ensure that our regulatory framework remains relevant and effective in supporting the good work of our Grantmakers.

23.     These changes will come in force at the start of next year.

Launch of the revised Risk Management Toolkit

24.     Second, let me talk a little bit about the Risk Management Toolkit, which I am sure many of you are familiar with, or if not, you should be familiar with.

25.     All innovation, all change, and whenever you try to push the envelope or try to be out of the box, they do come with a little bit of risk and because you are doing something differently from before, there is sometimes no precedent for it.

26.   Such change in innovation should not be stifled, and we should be looking at how we can promote change in innovation from a ground-up perspective.

(a)      Charities that are willing to innovate, push the boundary, push the envelope, try new things are often better positioned to address evolving social issues and thereafter make a positive impact on them.

(b)      However, it is also important at the same time to strike a balance, to manage these risks carefully and effectively, at the same time keeping in mind the fundamental ethos that charities must all subscribe to.

27.    Having a strong risk management framework can empower charities to proactively identify, assess, and mitigate potential risks that could impact their own operations, reputation, and also their financial performance.

28.     A Risk Management Toolkit for charities was first developed in 2016 to guide charities on their journey towards better risk management.

29.    With challenges from COVID-19, economic uncertainty, and ongoing and increasing geopolitical conflict, charities are themselves facing more demanding risks that require a broader and more effective risk management strategy, which also looks at some of the evolving paradigms that we see the sector is facing today.

30.     An extensive Risk Management Survey for Charities was conducted early this year.

(a)    I want to thank all respondents who participated so positively and actively in the survey.

(b)    The findings tell us that there has been a significant improvement in the sector as compared to the 2016 survey.

(c)    However, most charities are still establishing the foundations of a sustainable risk management programme and need more guidance on their journey.

31.     As such, the Charity Council, KPMG Singapore, and Singapore Institute of Technology (SIT) have developed a supplementary risk management toolkit for the charities.

(a)      It provides the 'next steps' guidance to improve and mature charities’ Enterprise Risk Management (ERM) practices.

(b)      It is designed as a supplement to the 2016 Risk Management Toolkit for charities, and additional templates have also been included.

32.     The toolkit looks specifically at lessons learnt from COVID-19. We also deal with new and emerging risks such as ESG and climate risks which charities are now increasingly more concerned with.

33.     Charities have to be constantly updated and evolved so that we can also understand and meet the needs of society's challenges today.

34.     This toolkit will be put in place, but at the same time, this is not the end of the toolkit. We will continue to keep an eye out for such emerging trends and consequently new risks that may arise, and from time to time, we might continue to update this toolkit.

35.    At the same time, with the toolkit in place, charities need make their own business continuity management programmes (BCP) . We need to look at this more seriously, because the pandemic, if there is one lesson from that, has shown us that we could be faced with an unexpected crisis of all sorts.

(a)  What we need in such times of crisis is for a strong BCP to be in place so that there is assured continuity and stable platform for the programmes to continue.

(b)  Our beneficiaries won't be affected adversely, and there will be a lot more stability. It should be framed in peacetime like now, so that when we are hit with an unexpected crisis, we will be able to confidently rely on an established protocol and a framework in the BCP that we can immediately trigger.

Charities’ best qualities are exemplified by their dedication to service and kindness

36.    Finally, before I conclude, I want to say a few words about Forward SG.

37.    For the past year, Singaporeans have been actively, proactively in many cases, sharing their vision of what a future Singapore would look like,  not just a future Singapore that they want to see because of policy, but how can they participate proactively in making a future Singapore go from an aspiration to a reality.

38.     That really is the core of the Forward Singapore exercise.

39.     A couple of weeks ago, we finalised our report, we launched it, we explained what the six pillars of Forward SG stand for, how they interact with one another, and how they become the foundational pieces of a new Singapore and the plans for a new social compact in Singapore.

40.     At the heart of the social compact is the idea or the notion that we all have a responsibility to contribute to the well-being of our communities.

41.     It is the idea that no one exists as an island, that we are all interconnected, that we all can and should contribute to the well-being of one another. And the fundamental idea is that in order for us to make Singapore truly inclusive and accessible, all of us have a role in doing that.

42.     This concept applies, if not equally, much more strongly in the charity sector.

43.     The charities embody this idea entirely, each and every one of you, in the work that you do, and in the beneficiaries that you touch daily. Your work complements the government's efforts to help foster greater social cohesion, a sense of belonging, a sense of community through volunteerism and community service.

44.     All of you run organisations that in itself might be small or large, but collectively the social impact is tremendous, creating a very positive societal impact.

(a)   The Government will commit to continuing to provide opportunities and assurances for charities and communities to contribute in your own way. We recognise that we want you to contribute in your own way, because each of your charities, each of your beneficiaries, you are all serving a different sector of society, and collectively we can become greater than the sum of our parts.

45.    We want to do this to nurture a stronger culture of giving, especially among those who have done well in our society, better connect donors and volunteers to local community needs, thereby strengthening our multiracialism, our intrinsic quality of diversity, and greater interaction between different groups because charity knows no colour, creed or religion.

46.    As a result of doing all this, to create a lot more avenues for ground-up participation, opportunities for us to step up to contribute and to make a greater impact than we can do on our own.

47.     I hope that we can all think about what you do, the work that you do in the context of the Forward Singapore ideals and philosophy, and think of how we can come together to really build a truly caring, inclusive, resilient society for Singaporeans.

48.     On that note, I want to just underscore the point I made right at the start, much as we want to move forward, evolve, look at developing trends in Singapore, at the core of what we need to get right is openness, accountability, and I would say, utmost scruples when it comes to scrutiny.

49.     When we can assure the public of this, we will have a tremendous foundation on which to move forward with our programmes. Let us not shy away from scrutiny, but welcome it as an opportunity to learn, to improve, to innovate and to do better.

Closing: Together, we can make a positive impact through greater governance and accountability.

50.     In closing, I hope this conference will give you some exposure to different learning, different experiences, thought leadership, and share ideas.

51.   I think what is most important too, if you look around the room today, we come from different and diverse sectors, and a range of different experiences.

52.     I hope that you also walk away from today with more networks, more friendships, more connections, because when we can do that and we can bring our charity sector together, then I think we will really be in a strong position to make a real positive impact.

53.     Collectively, this charity sector will rise up in terms of the quality, uplifting each and every one of the charities to be able to serve Singapore and Singaporeans much better.

54.     Thank you very much.

Last updated on 01 December 2023