WANTED: 1,000 independent members for company boards
ISTANBUL- Hürriyet Daily News
Independent board members are expected to bring a strategic approach to the management of public firms, as senior execs are often busy conducting everyday operations. AP photoA total of 371 Turkish publicly traded firms will need up to 1,000 new independent board members, in order to comply with a new trade law which comes into effect on July 1, according to the Secretcv.com, a human resources web portal.
Publicly traded firms on the Istanbul Stock Exchange have to assign independent members to one third of seats on management boards according to the new trade code. It is estimated that the firms will select between 700 and 1,000 independent members when they hold annual board meetings during April and May, the website said in a press release.
These members, unlike other board members, will have to come from outside the firms’ staff and shareholders. Another condition is that independent members should not be a former manager of the firm they are assigned to.
It is expected that independent members should have qualifications such as a high level of knowledge about strategy, management, and related experience. They should also bring industrial, functional and managerial expertise to the position.
The benefit of independent members is that they bring strategic approach and a “helicopter point-of-view” to boards of management, according to SecretCV.com. While senior executives spend most of their times with an operational work load, independent board members can add value to the management with ideas on strategic development of firms and sustainable growth.
Independent board members are often seen as a solution to corporate governance problems, the recruiter says, adding that building up a firm’s reputation, increasing foreign capital investment, improving competitiveness, and better allocating of resources are some of the advantages independent members may bring in.
Independent members have the same legal rights as others members of boards.
Management boards have to submit a candidate list to the Capital Markets Board (SPK) 60 days prior to their next board meeting. The SPK then evaluates the list in light of independent membership criteria and submits its report back to the firm in 30 days. Those who are barred by the SPK cannot be assigned.