As the regulations on independent directors turn more stringent, corporate executives are increasingly less willing to take up the fiduciary duties, especially when the fees are small.
According to Kasturi Nathan, Head of Governance and Sustainability said “Independent directors are now clearly taking their responsibility more seriously than ever before simply due to the requirement of the market as well as changes in the regulatory environment”.
She also agreed that it is increasingly difficult to find qualified independent directors. She further explained “As we engage on a one-to-one discussion with these family-owned boards, they are more likely to undertake a robust board evaluation process and improve where required simply because they believe in the substance of the outcome. Why? This is driven very much by the market . You increasingly find investors, customers and suppliers demanding that directors, senior management or owners of companies demonstrate how they address strategies and risks, and explain performance or measurement plans to manage the risks”.
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