A Comparative Analysis of Director Tenure in South Africa and Selected International Jurisdictions (2021) 54(1) Comparative and International Law Journal of Southern Africa 1-37

Comparative and International Law Journal of Southern Africa

37 Pages Posted: 20 Sep 2021

Date Written: September 16, 2021

Abstract

Director tenure attracts attention worldwide and is increasingly being recognised as a crucial element in assessing an external (independent non-executive) director’s independence. Director tenure has recently come under the spotlight in South Africa. Shareholder activists are expressing disapproval of lengthy tenures of directors serving on boards of listed public companies and exerting pressure on long-serving directors to resign from office. This article examines whether the South African corporate governance principles regulating director tenure are adequate or in need of revision. The article examines further the corporate governance practices in leading jurisdictions such as the United Kingdom, Malaysia, Singapore, Hong Kong, and India that have recently revised their corporate governance practices. It then makes recommendations for enhancing the South African corporate governance approach to director tenure. It also calls on directors to collaborate with shareholders and independent external experts to examine their approach to director tenure and, if circumstances allow, revise the company’s memorandum of incorporation to limit directors’ tenure or provide for a staggered rotation of directors on the board.

Keywords: Director tenure, independent non-executive directors, shareholder approval, disclosure, transparency

JEL Classification: K20]

Suggested Citation

Cassim, Rehana, A Comparative Analysis of Director Tenure in South Africa and Selected International Jurisdictions (2021) 54(1) Comparative and International Law Journal of Southern Africa 1-37 (September 16, 2021). Comparative and International Law Journal of Southern Africa, Available at SSRN: https://ssrn.com/abstract=3924836

Rehana Cassim (Contact Author)

University of South Africa ( email )

City of Tshwane
Pretoria
South Africa

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