Brief Thoughts on the Delay of Board Renewal for Listed Companies

The term of office for the board of directors of a listed company may not exceed three years. However, many companies fail to hold timely board renewals upon expiration of their directors' terms and instead issue announcements citing various reasons. Is there a time limit on such delays in board renewal? I. Relevant Regulations Article 45 of the Company Law stipulates: 'The term of office for directors shall be specified in the company’s articles of association, but each term may not exceed three years. Directors whose terms expire may stand for re-election and serve consecutive terms. If directors whose terms have expired are not promptly replaced, or if resignations during their term reduce the number of board members below the statutory minimum, the incumbent directors must continue performing their duties until newly elected directors assume office.' Based on the above provisions, the following conclusions can be drawn: 1. The law acknowledges 'failure to promptly replace directors upon expiration of their term,' thereby implicitly permitting delayed board renewal; 2. During the delay period, incumbent directors remain obligated to perform their duties; 3. During the delay period, directors may resign, provided such resignation does not reduce the number of board members below the statutory minimum; 4. No explicit time limit is prescribed for how long the renewal may be delayed. II. Delayed Renewal Is Not Permissible Indefinitely Although the Company Law does not explicitly specify a maximum permissible delay, the Guidance on Establishing an Independent Director System in Listed Companies states: 'The term of office for independent directors shall be identical to that of other directors of the listed company; upon expiration of their term, they may stand for re-election, but their cumulative tenure may not exceed six years.' Thus, independent directors must be replaced after no more than two consecutive terms and may not serve beyond this limit.

Term of Office and Resignation Rules for Directors

The term of office for directors is specifically defined in the company’s articles of association, subject to constraints imposed by the People’s Republic of China Company Law, which provides the following rules regarding director terms: 1. Basic Provisions Length of Term: According to Paragraph 1 of Article 70 of the People’s Republic of China Company Law, the term of office for each director may not exceed three years. Accordingly, the company’s articles of association must comply with this statutory upper limit when specifying director terms. Re-election: Upon expiration of their term, directors may stand for re-election and serve consecutive terms. 2. Special Circumstances Failure to Conduct Timely Replacement: If directors are not promptly replaced upon expiration of their term, or if a director’s resignation reduces the number of board members below the statutory minimum, incumbent directors must continue performing their duties until newly appointed directors assume office. This ensures continuity and stability in the company’s daily management. 3. Special Provisions for Independent Directors Pursuant to regulations including the Measures for the Administration of Independent Directors of Listed Companies, the cumulative tenure of independent directors may not exceed six years. II. Director Resignation Rules According to Paragraph 3 of Article 70 of the People’s Republic of China Company Law, a director wishing to resign must submit written notice to the company. Resignation becomes effective upon the company’s receipt of such notice, except where the circumstances described in the preceding paragraph apply—in which case, the director must continue performing duties.

Orion SA Announces Routine Board Transition as Director Departs

Apr 11, 2026

Orion SA announced board member Michel Wurth will not seek re-election in a routine transition. Analysts rate the stock neutral, citing weakening profitability and high leverage.

The Globe and Mail

Orion SA Announces Routine Board Transition as Director Departs

TipRanks

Orion SA Announces Routine Board Transition as Director Departs

The Globe and Mail

2026-03-22

Orion S.A. stock faces headwinds amid carbon black market slowdown and supply chain pressures

2026-04-11

Orion SA Announces Routine Board Transition as Director Departs

2026-04-15

Orion S.A. Posts Q1 Results May 6, Holds Investor Call May 7