Singapore, 9 January 2025, – KPMG Singapore and the Singapore Institute of Directors (SID) have unveiled their Joint Budget 2025 Proposal, “Designing Singapore’s Future Together: Ready, Refreshed and Resilient for Tomorrow.” This comprehensive blueprint outlines strategic initiatives to position Singapore as a global leader in value creation, focusing on attracting talent, investment, and innovation while harnessing the potential of capital markets to drive economic growth. The Proposal advocates for transformative changes within the capital markets, enabling enterprises in Singapore to align with global trends and foster sustainable growth in line with national aspirations.
Central to the Proposal is the enhancement of corporate governance to build investor confidence. By establishing Singaporean enterprises as benchmarks of transparency and integrity, this initiative aims to nurture trust across the business ecosystem, from large multinational corporations to small and medium-sized enterprises (SMEs). Complementing this is a recommendation to stimulate organic innovation through research and development, supported by green financing and targeted incentives.
The Proposal also introduces a “fast pass” framework to simplify complex transitions in sustainability and technology. This approach includes providing businesses with ready-to-use resources, swift assistance, and structured government support, ensuring a seamless path to adopting innovative solutions and sustainable practices. These efforts will bolster Singapore’s global standing as a hub for value creation and economic leadership.
Key Recommendations for Value Creation
1. Advancing ESG Priorities
The Proposal underscores the importance of empowering enterprises to adopt sustainable practices through national frameworks, grants, and reporting tools. A dedicated ESG industry hub is proposed to help businesses align with international sustainability standards, fostering Singapore’s transition to a greener economy.
- Blended Finance and Green Incentives: Introducing strategic grants and guarantees to support decarbonisation efforts in industries that are challenging to abate. Utilising carbon tax revenues and enhanced subsidies to fund research and development in sustainable technologies, promoting commercially viable carbon reduction solutions.
- Decarbonisation Assistance: Establishing a long-term financial support facility to enable clean energy adoption, energy efficiency, and innovative solutions for hard-to-abate sectors.
2. Driving Innovation
To further solidify Singapore’s role as a global innovation hub, the Proposal advocates leveraging financial tools and AI governance standards to foster technological advancements.
- AI Governance and Training: Allocating funds for research into AI governance technologies and providing grants for responsible AI adoption. This ensures ethical deployment and transparency, addressing the complexities of emerging AI solutions.
- Leadership Development in ESG and Innovation: Incentivising professional development for directors to enhance governance excellence and strategic foresight, enabling businesses to adapt effectively to evolving global challenges.
3. Enhancing Workforce Development
Strengthening the workforce is vital to sustaining Singapore’s competitive edge as a talent hub. The Proposal includes recommendations to align with the Forward Singapore agenda and bolster professional growth through targeted initiatives.
- National Leadership Competency Index: Establishing benchmarks to evaluate and cultivate leadership capabilities across industries, supporting regional and global growth.
- Micro-Credentialling and Upskilling: Expanding short-term certifications in high-demand areas like AI and sustainability, supported by tax incentives and grants to encourage businesses to invest in workforce development.
- Board Evaluations: Mandating regular external board reviews to enhance governance standards and ensure unbiased oversight of corporate strategies.
4. Supporting International Growth
To strengthen Singapore’s global presence, the Proposal includes measures to help businesses expand internationally while addressing emerging challenges.
- Grants for Cross-Border Collaboration: Enhancing financing schemes to support partnerships in high-growth sectors such as digital and green economies.
- Tax Governance and Compliance: Implementing government-backed advisory programmes to help small enterprises align with international standards, reduce risks, and improve efficiency in complex tax environments.
Sector Leaders on Singapore’s Future
Lee Sze Yeng, Managing Partner at KPMG in Singapore, stated, “As Singapore enters SG60, we must focus on developing leaders with foresight and expertise in sustainability and technology to drive ambitions across sectors and secure a competitive edge in a rapidly changing global landscape. A cohesive national strategy, aligned with the Forward SG agenda, is vital for nurturing future leaders.”
Ajay Kumar Sanganeria, Partner and Head of Tax at KPMG in Singapore, remarked, “The government must take the lead in driving transformation by using systemic levers, engaging industry stakeholders, and implementing impactful strategies. Tax policies should strategically incentivise R&D and drive organic innovation, ensuring Singapore leads in ESG and technological advancements.”
Terence Quek, CEO of SID, emphasised, “Directors are uniquely positioned to champion the integration of ESG principles into the core of business strategies. By fostering a culture of sustainability and innovation, directors can ensure long-term value creation.”
Neil Parekh, Governing Council Member at SID, added, “Public capital markets, along with the fast-growing private financing markets, are a powerful engine for value creation. Directors play a crucial role in guiding businesses to strategically leverage these markets, ensuring investments drive long-term value creation for all stakeholders.”
Singapore’s Path Forward
The Budget 2025 Proposal outlines a clear and actionable roadmap for Singapore to reinforce its position as a global leader in sustainability, innovation, and workforce excellence. By implementing these strategies, Singapore can achieve its vision of being a ready, refreshed, and resilient nation prepared for the opportunities and challenges of tomorrow.
