"The board of directors of an issuer is collectively responsible for its management and operations. The Hong Kong Stock Exchange expects the directors, both collectively and individually, to fulfil fiduciary duties and duties of skill, care and diligence to a standard at least commensurate with the standard established by Hong Kong law". # Note 1.

"The board of directors is collectively responsible for promoting the success of the company by directing and supervising the company's affairs and in particular to provide entrepreneurial leadership of the company within a framework of prudent and effective controls which enable risk to be assessed and managed." # Note 2.

An Independent Non-Executive Director (INED) is expected to provide independent advice to senior executives on business strategies; risk management and internal control.

Requirement

You are required to critically analyse the development of an INED director's duty of care, skill, and diligence from the common law position of Re City Equitable Fire Assurance Co Ltd [1925] Ch 407 up to and including Companies Ordinance (Cap. 622) and any relevant provisions under the Main Board Listing Rules relating to the roles and responsibilities of an INED.

NOTES

Note 1: Chapter 3.08 Main Board Listing Rules.

Note 2: Page 21, Review of the role and effectiveness of non-executive directors, Derek Higgs, Jan 2003)