Corporate governance for unlisted material subsidiaries: independent director representation, audit review, and shareholder approval for major disposals.

Regulation 62L requires that at least one independent director of a listed entity serve on the board of each unlisted material subsidiary and that the listed entity's audit committee review the subsidiary's financial statements and investments. Minutes of the subsidiary's board and periodic statements of all significant transactions (transactions likely to exceed ten per cent. of prior year revenues, expenses, assets or liabilities) must be placed before the listed entity's board. Disposal of shares reducing holding to fifty per cent. or less or relinquishing control, and aggregate asset sales/disposals/leases exceeding twenty per cent. in a year, require shareholders' special resolution, subject to specified insolvency or court approved exceptions and disclosure requirements.

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