April 10, 2008 (LBO) – Sri Lanka’s top state legal advisor has told company directors not to be mere ‘rubber stamps’ but to act independently and in the best interests of their companies and stakeholders. Attorney-general C R de Silva said company directors today are expected to meet an increasing range of obligations amidst commercial and legal expectations.
Directors should ensure company financial reports and audits are reliable, and act against corporate fraud, he told a seminar on stock market offences organised by the regulator, the Securities and Exchange Commission (SEC).
Directors should also ensure they have properly understood documents on which they are asked to make decisions.
“(They) have duty to make further inquiries when appropriate so that they are able to come to independent views on matters and not merely act as a ‘rubber stamp’ on decisions that have wider ramifications,” de Silva said.
The seminar was held to raise awareness and educate directors and senior managers of listed companies on offences under the SEC Act and their duties and obligations.
Certain Sri Lankan business leaders have in the past criticised their colleagues in the boardrooms for not tak