ACCA LW · Chapter 12 · Question 2 of 11
Which of the following is a recommendation of the UK Corporate Governance Code concerning board structure?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) The roles of chair and chief executive should not be exercised by the same individual
Explanation
The Code calls for a clear division of responsibilities between running the board (the chair) and running the business (the chief executive), so the two roles should not be exercised by the same individual. It also expects at least half the board, excluding the chair, to be independent non-executive directors, and the audit committee to consist of independent non-executive directors. Executive directors, including the chief executive, should not sit on, let alone chair, the audit committee.
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