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The statistics shared by the SC also showed that out of the 3,376 independent directors sitting on the board of listed companies in 2020, 775 or 23% have served beyond the nine-year term. Of this 775, 275 or 35.5% are those within the nine to 12 years tenure period, 53% are in the 13-20 years bracket, 85 or 11% are in the 21-30 years bracket.Three independent directors have also served beyond 30 years while one has served more than 40 years.

LAST week, the Securities Commission (SC) released a report entitled Corporate Governance Strategic Priorities 2021-2023 (CGSP) which outlined the regulator’s five strategic thrusts.

This includes matters related to board leadership; environment, social and governance (ESG) fitness of boards; and, stewardship and engagement.

Under the Strategic Priority related to board leadership, the SC has now introduced a mandatory 12-year tenure limit for independent directors. In the CGSP report, the SC had highlighted the long-recognised issue related to independent directors with facts.

Based on the data shared by the SC, it is a common theme among listed issuers, especially among those outside the definition of a large corporation, to have independent directors serving beyond the nine or even the current new limit of twelve years.

The article was first published here.

Photo by Michał Parzuchowski on Unsplash.

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