In companies in South Africa where directors could be conflicted for diverse reasons, one way of addressing the problem is to have a majority of independent directors on the board (i.e. directors who are not affiliated with the company, its management, or any significant shareholder) in order to help ensure that the company is managed in a responsible and ethical manner, which can benefit all stakeholders, including employees, customers, suppliers, and shareholders.
Other benefits of having a majority of independent directors on the board of such companies include –
• Impartiality: Independent directors can provide an impartial perspective and help ensure that the board's decisions are made in the best interest of the company and its stakeholders.
• Better Governance: Independent directors can bring a higher level of governance to the board, including monitoring and oversight of management, risk management, and compliance with legal and regulatory requirements.
• Increased Accountability: Independent directors can help ensure that the board and management are held accountable for their actions and decisions, and that the company operates in a transparent and ethical manner.
• Improved Investor Confidence: Having a majority of independent directors on the board can increase investor confidence in the company and its leadership, which can help attract capital and support growth.