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Definition

A director who is not employed by the company and has no employment contract. An executive director has an employment contract and works directly for the company. The Companies Act makes no distinction between executive and non-executive directors - they both have the same duties and obligations in terms of the Act. Non-executive directors typically attend board meetings and may sit on various committees like the audit committee or the remuneration committee. Non-executives are a requirement of the King 3 report on corporate governance and hence they must be employed by all listed companies in terms of the JSE rules.

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