CFA Institute Study on Independent Non-Executive Directors - A Search for True Independence in Asia

Concentrated ownership structures and weak legal protection in Asia increase the importance of independent non-executive directors on corporate boards.  In Asia, companies commonly have controlling shareholders who have the ability to control the nomination and election of directors to the board.  This study examines ways to ensure that so-called independent directors are, in fact, independent.  Four key areas are identified for discussion and improvement: (i) director nomination and appointment; (ii) the concept of independence; (iii) director training and qualification; and (iv) the number of independent directors on the board.  The study also includes a comparative analysis of the regulations and codes of corporate governance in Hong Kong, Singapore, India, and the Philippines.

Originally Published: 
01/01/2010