Independent Directors: Magic Bullet or Band-Aid?

Abstract

This article examines directors’ independence reforms in Australia, the US and Europe. It examines and contrasts how this end is achieved in the three jurisdictions. It then critically examines the assumption that independent directors necessarily improve corporate governance standards or a company’s performance. The fluid nature of Australian corporate governance standards make this inquiry relevant. It concludes that Australia should pause – and look very hard – before it leaps into adopting rules similar to those in the US or Europe.