The information on this page was current at the time it was published. Regulations, trends, statistics, and other information are constantly changing. While we strive to update our Knowledge Base, we strongly suggest you use these pages as a general guide and be sure to verify any regulations, statistics, guidelines, or other information that are important to your efforts.
The Impact of Singapore Governance on Business
What is Governance?
According to the World Bank Group, “Governance consists of the traditions and institutions by which authority in a country is exercised. This includes the process by which governments are selected, monitored and replaced; the capacity of the government to effectively formulate and implement sound policies; and the respect of citizens and the state for the institutions that govern economic and social interactions among them.”
Singapore’s robust governance system is a cornerstone of its thriving business environment. Understanding these key aspects of Singapore’s governance will empower you to make informed decisions for your company’s expansion.
Singapore Government Effectiveness
The World Bank Group evaluates and reports on world governments and their effectiveness in their Worldwide Governance Indicators reports. Singapore ranks very highly on most of its aggregate scores and first overall, indicating that the government in Singapore is considered very effective – another reason to consider doing business in that country.
The six parameters for which perceptions are captured in the World Governance Indicators reports and Singapore’s scores are:
- Voice and Accountability : The extent to which a country’s citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association, and free media. Singapore’s lowest score was for Voice and Accountability. There are several factors that likely play into this rating. First, Singapore has had just one political party since the country was formed in 1965. While that single party was instrumental in establishing many of the regulations and guidelines that have made Singapore the success it is today, there has been tight control over the media and the conservative cultural values drive many of the country’s laws. You will have difficulty succeeding if your product or service does not align with Singapore’s value structure.
- Political Stability and Absence of Violence/Terrorism : The likelihood of political instability and/or politically-motivated violence, including terrorism.
- Government Effectiveness: The quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government’s commitment to such policies
- Regulatory Quality: The ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development .
- Rule of Law: The extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police, and the courts, as well as the likelihood of crime and violence.
- Control of Corruption: The extent to which public power is exercised for private gain, including both petty and grand forms of corruption, as well as “capture” of the state by elites and private interests Singapore’s high ranking indicates that governance in Singapore relating to business is very effective.
Significance of Rule of Law and Economic Growth in Singapore
When asked about which factor is most important when evaluating which countries to do business in, many companies will say that the rule of Law is their biggest concern.
As stated above in the Worldwide Governance Indicators results, The Rule of Law concept considers the extent to which business operators within a select country have confidence in and abide by the rules or laws of that society. Some of the characteristics that should be evaluated to make a sound decision encompasses the clarity, certainty and predictability of laws and their application.
Some considerations are:
- Contract enforcement consistency
- Adherence to property rights (personal, business, intellectual)
- Ability and effectiveness of the courts to make and enforce laws
- The likelihood and ability of the police to enforce laws
- The extent of crime and violence
Some of the specific practices to watch out for are the freedom from expropriation, physical security of persons, respect for contracts, access to effective and efficient courts, and government adherence to agreements and clear dispute resolution procedures. Well-functioning law and justice institutions and a government bound by the rule of law are important to economic, political and social development.
The World Governance Report provides an extensive list of resources to help you understand their ratings.
Evaluating Singapore’s Governance: World Bank Assessment
In its last World Bank Group Doing Business: 2020 report which was released in 2020, the World Bank Group ranks 190 countries for ease of doing business as a small or medium-sized company.In 2020, the ease of doing business score in Singapore reached 86.2.
During the period of consideration, the ease of doing business in Singapore went from rank 1 in 2013 to rank 2 in 2020. Specifically, regulations applying to companies through their life cycle are considered. A high ranking indicates that the regulatory environment is relatively more conducive to starting and operating a company locally.
The World Bank Group ranking takes into consideration the following parameters:
- Starting a Business
- Trading across Borders
- Getting Credit
- Registering Property
- Paying Taxes
- Protecting Minority Investors
- Enforcing Contracts
- Resolving Insolvency
- Dealing with Construction Permits
- Getting Electricity
Singapore consistently ranks among the top countries globally for ease of doing business according to the World Bank’s Doing Business Report. This ranking reflects factors like:
- Streamlined Business Registration: Singapore boasts a fast and efficient business registration process.
- Strong Legal Framework : A clear and predictable legal system minimizes regulatory burdens.
- Transparent Regulations: Government regulations are readily accessible and well-defined.
In September 2021, World Bank Group management decided to improve upon and replace Doing Business. However, the Doing Business website continues to be publicly available as an archive of knowledge and data.
Singapore Public Sector Corruption Levels 2025
Every year, Transparency International publishes a report on perceived public sector corruption around the world. Their latest report, Transparency International’s Corruption Perceptions Index 2025, reports on 182 countries. Transparency International looks at a number of areas – how the corruption perceptions index is calculated – where corruption can take place, such as education and defense & security.
Singapore ranked 3rd in Transparency International’s Corruption Perceptions Index 2025 report, with a total score of 84 out of 100 (a perfect score is 100, and the highest score earned was 89 by Denmark).
Singapore consistently ranks among the least corrupt countries globally according to Transparency International’s Corruption Perception Index (CPI). This low level of perceived corruption translates to:
- Fair Competition: Businesses can compete on a level playing field without the risk of bribery or unfair practices.
- Efficient Government Services: Businesses can interact with the government with minimal bureaucracy and red tape.
- Enhanced Reputation: Operating in a country with low perceived corruption can enhance your company’s reputation.
The Singapore Worldwide Governance Indicators
The Worldwide Governance Indicators reports provide an extensive list of resources to help you understand their ratings. Singapore scores came in as follows, where a zero score is bad and a 100 score is good;
- Voice and Accountability – 58.1
- Political Stability and Absence of Violence/Terrorism – 86.5
- Government Effectiveness – 95.3
- Regulatory Quality – 88.4
- Rule of Law – 81.5
- Control of Corruption – 86.8
References
- Singapore Economic Development Board
- Publications | World Economic Forum
- Singapore Government
- World Bank Group Business Ready (B-READY) 2024
- Singapore Academy of Law
- Transparency International’s Corruption Perceptions Index 2025
- Singapore Business Federation
- Worldwide Governance Indicators | DataBank
- Singapore Business Federation
- World Bank Group Doing Business: 2020