ABSTRACT
For the board of directors of a firm to effectively perform their many tasks such as developing strategy and enforcing operational and financial reviews and controls, it is expected that they should be properly remunerated. Preferably, the remuneration should be linked to the performance of the firm. However, this is not the case in many developing and emerging markets. Not only is the remuneration not linked to performance, information relating to remuneration of the board of directors is limitedly (or not) disclosed. To address these key challenges, there is a need for reforms to link remuneration to performance and a requirement for proper disclosure to be effectively pursued across developing and emerging markets. However, as reforms through hard laws and regulations sometimes achieve limited results, it is also important to use soft laws and other mechanisms such as self-regulation to advance the reforms.
