‘Say on pay’ reforms have been advocated and implemented in many major jurisdictions over the last decade, including the US and UK. Singapore and Hong Kong, however, which are recognized by the World Bank to have the second- and fourth-best regulatory environments in the world for investors to do business respectively, have bucked the international trend of allowing shareholders a binding or advisory vote on the remuneration of corporate managers. In Singapore and Hong Kong, ‘say on pay’ has either been rejected or ignored in the latest round of reforms to the corporate governance codes despite studies which have found that Singapore and Hong Kong have the highest executive pay in Asia, with base salaries for top executives rising to more than 25% higher than their US counterparts. Could this be the curious case of ‘Asian values’?
While Singapore and Hong Kong share the same common law legal traditions with the US and UK in the same bucket of liberal market economies (LMEs), as the ‘Varieties of Capitalism’ framework would suggest, they may be said to practice a different form of ‘regulatory capitalism’ from their Anglo-American counterparts under their corporate governance regimes. This paper looks at the institutions of political economy within Singapore and Hong Kong and how they may explain this variance in ‘say on pay’ regulation between states. It argues that this may be attributed to factors such as Singapore and Hong Kong’s distinctive patterns of corporate ownership, the participation of institutional investors, the role of the state and ultimately the socio-political culture and ethos within a non-Western liberal democratic framework. It concludes with what the implications of this variance may be for future regulatory reforms on ‘say on pay’ and theories of corporate governance in the broader context – namely, why are certain