SEC intervenes in independent directors’ issue for the first time
View(s):The Securities and Exchange Commission (SEC) for the first time under corporate governance regulations has intervened in the appointment of independent directors to a company.
On Wednesday, the SEC directed Watawala Plantations PLC to appoint new independent non-executive directors to the board as three of their present independent directors do not fulfill the criteria of ‘independent’ as per the Listing Rules of the Colombo Stock Exchange (CSE). “This is the first time where SEC has objected saying a company’s independent directors don’t come under the ambit of CSE rules,” an SEC official told the Business Times.
He said that when SEC’s Corporate Governance (CG) rules became mandatory in 2008 the rule on independent directors (which is a part of CG rules) also kicked in.
Informed sources said that the independent directors at Watawala Plantations were nominees from the India-based Tata Group which has a stake in the company.
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