ECONOMYNEXT – Sri Lanka’s Colombo Stock Exchange (CSE) said revised corporate governance rules will be applicable from October 1, 2023 to companies listed on the main board, Diri Savi board and Catalyst board.
The revised rules are not applicable to the companies listed on the Empower Board.
Some companies have already started to implement the requirements, the CSE said in a statement.
“The revised Corporate Governance Rules of the CSE were formulated in line with global best practices and will go a long way in enhancing investor confidence in the capital market. The new rules would attract more investors to the stock market,” the CSE said in a statement.
The CSE and the Securities and Exchange Commission of Sri Lanka (SEC), revised the corporate governance rules for listed entities after 16 years.
When formulating the rules, the SEC and CSE conducted public consultations from 2021 to 2023 and considered the views received.
The CSE and SEC also conducted awareness sessions on the revised rules for listed companies in the banking sector,
insurance sector (with the Insurance Regulatory Commission of Sri Lanka), and other industry sectors.
Some of the key changes introduced via the new Rules include specifying a minimum number of directors and independent directors for listed entities, appointment of a ‘Senior Independent Director’ in certain specific instances, establishment and operationalization of a Nomination and Governance Committee, change in the composition and functions applicable to the Audit, Remuneration and Related Party Transaction Committees, introduction of Fit and Proper criteria for Board members and CEO, changes to determine the criteria for ‘independence’, additional disclosure requirements on governance-related matters etc. (Colombo/Dec19/2023)