1. What are the benefit(s) and drawback(s) of voting by a show of hands compared to voting by poll?

In
your opinion, was the change of voting methods during Hong Fok’s AGM legitimate and fair to minority
shareholders?

A show of hands is an alternate to voice voting, often used in small boards, committees or also informal
gatherings, but also in larger assemblies.[3] It is more precise than a voice vote but does not require
members to rise from their seats. However, it does not count as a division of the assembly, and is not
always as effective as a rising vote in causing a maximum number of members to vote who have not
done. As for voting by poll is a method to record voters how many ballots or people to vote the head.
Somehow it more complicated than vote a show of hands because it must compare how many people
and the votes.

Actually no. because, The debate between minority shareholders and board further intensified when
the chairman Cheong Kim Pong requested for a change of voting methods mid-way. Minority
shareholder Mr Mano Sabnani later complained to Business Times, “... shareholders rejected the
directors’ report and the audited results by show of hands... so chairman proposed that all the
resolutions be put through the poll”. Such change angered minority shareholders and some left before
voting for other resolutions7. However, the AGM continued with the remaining shareholders and all
resolutions were passed by poll almost unanimously.

2. Evaluate the board composition and structure of Hong Fok for FY2011. In your opinion, how might the
announced changes (e.g. the appointment of independent directors, set-up of nomination committee
and remuneration committee, etc.) on 30th March 2013 affect the corporate governance of Hong Fok?

the board comprised of four executive directors and three non-executive directors.

On 30 March 2013, Hong Fok announced that it would appoint Mr Chow Yew Hon as an independent
director and Mr Jackson Lee as the Lead Independent Director of the company.

3. In the case of Hong Fok, were the levels of directors’ remuneration appropriate? Currently, what are
the available safeguards against excessive directors’ and management’s remuneration?

4. In your opinion, was the interference by SGX sufficient or effective? What is the role of SGX in
protecting minority shareholders?

5. Compare the SGX listing rules with that of the Stock Exchange of Hong Kong with regard to Interested
Person Transactions (IPTs). Which stock exchange provides more effective safeguards for minority
shareholders against IPTs?

6. In many Asian countries, family-controlled companies are very common. What are the key challenges
in fostering good corporate governance in such companies?
Problem

 The debate between minority shareholders and board further intensified when the chairman
Cheong Kim Pong requested for a change of voting methods mid-way. Minority shareholder Mr
Mano Sabnani later complained to Business Times, “... shareholders rejected the directors’ report
and the audited results by show of hands... so chairman proposed that all the resolutions be put
through the poll”. Such change angered minority shareholders and some left before voting for other
resolutions. However, the AGM continued with the remaining shareholders and all resolutions were
passed by poll almost unanimously.
 Hong Fok declared its last dividend of 6 cents per share back in FY200712. No cash dividends were
declared between FY2008 and FY2011, although revenue of the company increased from S$58
million to S$129.2 million. For FY2011, Hong Fok declared a 5-for-1 bonus issue instead. During the
AGM, minority shareholder Mano questioned the lack of cash dividends.
 Mano also questioned the excessive remuneration paid to executive directors, especially considering
the lack of dividends and a remuneration committee. Another minority shareholder cited that
directors were paid highly even when Hong Fok was making losses. However, their opposition to
directors’ remuneration by show of hands was over-ridden when the chairman the requested to
switch to voting by poll.