INCORPORATING THE INDEPENDENT-DIRECTOR CONCEPT INTO THE NIGERIAN COMPANY LAW: CHALLENGES AND PROSPECTS

Abstract

The purpose of identifying and appointing independent directors is to ensure that the board includes directors who can effectively exercise their best judgement for the exclusive benefit of the company, judgment that is not clouded by real or perceived conflicts of interest. The paper therefore analyses the challenges and prospects of incorporating the independent director concept into the Nigerian Company Law. The doctrinal method of legal research was adopted. The Paper found out that there was no provision on the roles of independent directors under Nigerian Company Law and therefore recommended the need to strengthen the independence of independent directors and enhance their effectiveness in the protection of shareholders’ interests especially the minority shareholders by making provision on the roles played by independent directors. The appointment of independent director should be rotated periodically to ensure the transparency and fairness in their decision. Legal protection should also be provided to independent directors so that they can raise their voice against the management and force their views in the interest of shareholders.