The Monetary Authority of Singapore (MAS) has released a circular detailing new governance and management requirements for Variable Capital Companies (VCCs). Issued on 26 June 2025, the circular follows a thematic review by MAS and outlines key regulatory expectations for fund managers operating VCCs.
The circular, identified as IID 04/2025, emphasises the need for robust governance frameworks to ensure the effective management of VCCs. This move is part of MAS’s ongoing efforts to strengthen Singapore’s position as a leading fund management hub. The circular highlights several areas of focus, including the roles and responsibilities of directors, risk management practices, and the importance of maintaining high standards of corporate governance.
MAS’s observations from the review indicate that whilst many VCCs have adopted sound governance practices, there is room for improvement. The circular serves as a guide for fund managers to align their operations with regulatory expectations and enhance their governance structures. This is crucial for maintaining investor confidence and ensuring the long-term sustainability of the VCC framework.
Fund managers are advised to review their current practices and make necessary adjustments to comply with the new guidelines. The circular also provides a roadmap for implementing these changes, ensuring a smooth transition for fund managers.
As Singapore continues to attract global investment, the enhanced governance standards are expected to bolster the country’s reputation as a secure and reliable financial centre. The MAS circular is a significant step towards ensuring that VCCs operate with transparency and accountability, ultimately benefiting investors and the broader financial ecosystem.
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