HKSI Paper 1 Business operations and practices question: Board Rule 3.12A

HKSI Paper 1Business operations and practices

Mr Fung is an INED of four Main Board issuers, an executive director of one GEM issuer and an INED of a company listed only in Singapore. In 2029 a fifth Main Board issuer invites him to become its INED. Under Main Board Rule 3.12A, may he accept?

A No, unless the issuer explains the departure in its CG Report, as the cap is a code provision
B No; counting the Singapore company it would be his seventh listed directorship, over the cap
C Yes; it would be his sixth directorship of a Main Board or GEM issuer, which the rule allows
D No; an INED may hold no more than five directorships of Main Board or GEM issuers at once

Show the answer and explanation

Answer: C. Yes; it would be his sixth directorship of a Main Board or GEM issuer, which the rule allows

Main Board Rule 3.12A (effective 1 July 2025; existing holders had until the first AGM on or after 1 July 2028 to comply) says an INED must not concurrently hold more than six directorships of issuers listed on the Main Board or GEM. Every directorship of an SEHK-listed issuer counts, executive or not, but directorships of companies listed only elsewhere do not. Mr Fung holds five (four INED roles and one GEM executive role), so the new seat makes six, which is allowed. Counting the Singapore company is wrong because the rule counts only Main Board and GEM issuers. The limit is six, not five. The cap is a Listing Rule, not a comply-or-explain code provision. Source: Main Board Listing Rule 3.12A and Note (effective 1 July 2025); HKEX Consultation Conclusions on Review of Corporate Governance Code and Related Listing Rules (December 2024) (as at October 2026).

Common mistake

Candidates count every listed directorship worldwide, or count only INED roles. The cap counts all directorships, executive or non-executive, of Main Board and GEM issuers only.

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Related HKSI Paper 1 questions

Ms Chen joined the board of a Main Board issuer on 2 March 2026. She has never been a director of a Main Board or GEM issuer, but until December 2025 she was a director of a Nasdaq-listed company. What minimum training must she complete under the Listing Rules?Mr Siu was an INED of a Main Board issuer from June 2015 to June 2021, left for two years, and was re-appointed in June 2023. Under Main Board Rule 3.13A, which of the following statements are CORRECT?Lion Peak Holdings Ltd, a Main Board issuer, has three INEDs: two have served since 2014 and one since 2023. Under the Listing Rules' cap on INED tenure, what must its board achieve by the conclusion of its first AGM held on or after 1 July 2028?

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Original study material mapped to the public HKSI Paper 1 syllabus. Unofficial, not endorsed by HKSI Institute or the SFC. Verify figures and rules against current guidance before relying on them.