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Changing Expectation of Independent Non-Executive Directors. Non-Executive Directors Forum. Jeckle Chiu Partner Mayer Brown JSM +852 2843 2245 jeckle.chiu @mayerbrownjsm.com. 7 December 2010. INEDs in Hong Kong. Why are we here today?
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Changing Expectation ofIndependent Non-Executive Directors Non-Executive Directors Forum Jeckle Chiu Partner Mayer Brown JSM +852 2843 2245jeckle.chiu@mayerbrownjsm.com 7 December 2010
INEDs in Hong Kong • Why are we here today? • Independent "non-executive" directors: diminished role? • Roles of INEDs in Hong Kong • General Duties • Enhancing the Standards • Listing Rules
Roles of INEDs in Hong Kong: Audit Committee • Majority presence in audit committee • At least 1 INED member with appropriate professional qualifications/accounting/related financial management expertise • Importance of audit committee • Roles of INEDs in audit committee TAKE A PROACTIVE ROLE TAKE A HOLISTIC VIEW
Roles of INEDs in Hong Kong: Protecting the minority • Market expectation: guardian of minority shareholders? • Providing an objective view on transactions • e.g. takeovers, spin-offs, share repurchases, connected transactions etc. • Taking into account the interests of the company and its shareholders as a whole RISING EXPECTATION
INEDs in times of Crisis: Resignation • When should I resign? • Listing Rules: ListCo to publish the reasons of a director's resignation • Limitations on using "personal reasons" as the reason for resigning • Restrictions under the Takeovers Code
Conclusion • The responsibilities and undertakings of INEDs are no less onerous than those of other directors • TAKE A PROACTIVE ROLE • TAKE A HOLISTIC VIEW • BEAR IN MIND THE RISING EXPECTATION
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