Dec 09, 2009 (LBO) – Sri Lankan banks have been urged to select their boards of directors with care to ensure they hire capable people with integrity and not just based on friendship or wealth. Attorney general Mohan Peiris, the government’s chief legal officer, said regulatory standards had been toughened in recent years amid heightened public expectations following a spate of corporate collapses.
“The bar has been raised – you are trustees,” he told a symposium for bank directors organised by the Central Bank.
“The courts will say ‘if you cannot play that role effectively, please go’.”
Given their responsibilities, directors of banks cannot just take a minimalist approach and do the bare minimum, Peiris said.
“The courts will say you must walk that extra mile. Director should be people whose abilities are widely acknowledged by shareholders.
“They should have experience, knowledge, expertise and good judgment to make an effective contribution to the bank to achieve its corporate objectives,” Peiris said.
He said it was up to the banks to choose their boards of directors carefully.
“Do you chose a friend who probably cannot contribute, or do you probably ch