A Sector Ban to Restore Trust in Corporate Governance

The integrity of corporate governance is under increasing scrutiny — and rightfully so. Belgium’s recent history has shown how vulnerable listed companies can be to manipulation, opacity, and abuse of power. When boardrooms are infiltrated by individuals with a track record of misconduct or regulatory breaches, the damage is not just financial — it’s institutional, undermining trust in the entire market.

That is why Belgian's parliamentary member Michael Freilich’s (N-VA) consideration, presented at last Friday’s 𝐂𝐨𝐫𝐩𝐨𝐫𝐚𝐭𝐞 𝐆𝐨𝐯𝐞𝐫𝐧𝐚𝐧𝐜𝐞 𝐒𝐮𝐦𝐦𝐢𝐭 organised by De Bestuurder, deserves serious attention. At its core is a deceptively simple but powerful idea: 𝐢𝐧𝐝𝐢𝐯𝐢𝐝𝐮𝐚𝐥𝐬 𝐟𝐨𝐮𝐧𝐝 𝐠𝐮𝐢𝐥𝐭𝐲 𝐨𝐟 𝐬𝐞𝐫𝐢𝐨𝐮𝐬 𝐛𝐫𝐞𝐚𝐜𝐡𝐞𝐬 𝐨𝐟 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐨𝐯𝐞𝐫𝐬𝐢𝐠𝐡𝐭 𝐫𝐮𝐥𝐞𝐬 𝐬𝐡𝐨𝐮𝐥𝐝 𝐛𝐞 𝐭𝐞𝐦𝐩𝐨𝐫𝐚𝐫𝐢𝐥𝐲 𝐛𝐚𝐫𝐫𝐞𝐝 𝐟𝐫𝐨𝐦 𝐡𝐨𝐥𝐝𝐢𝐧𝐠 𝐠𝐨𝐯𝐞𝐫𝐧𝐚𝐧𝐜𝐞 𝐫𝐨𝐥𝐞𝐬 𝐢𝐧 𝐁𝐞𝐥𝐠𝐢𝐚𝐧 𝐥𝐢𝐬𝐭𝐞𝐝 𝐜𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬. A sector ban, would allow the Belgian regulator FSMA and its sanction commission to prohibit such individuals from serving on boards for a defined period.

This initiative is not hypothetical. It was born from the fallout of the Nyrstar case — a corporate saga that exposed glaring gaps in minority shareholder protection and the apparent ease with which power can be consolidated by dominant players. Freilich’s proposal aims to close those gaps, ensuring that those who breach public trust cannot simply re-enter the system through another board seat.

In tandem with the sector ban, Freilich also advocates for greater shareholder democracy — notably a rule 𝐫𝐞𝐪𝐮𝐢𝐫𝐢𝐧𝐠 𝐭𝐡𝐞 𝐚𝐩𝐩𝐫𝐨𝐯𝐚𝐥 𝐨𝐟 𝐚 𝐦𝐚𝐣𝐨𝐫𝐢𝐭𝐲 𝐨𝐟 𝐭𝐡𝐞 𝐦𝐢𝐧𝐨𝐫𝐢𝐭𝐲 𝐬𝐡𝐚𝐫𝐞𝐡𝐨𝐥𝐝𝐞𝐫𝐬 𝐰𝐡𝐞𝐧 𝐚𝐩𝐩𝐨𝐢𝐧𝐭𝐢𝐧𝐠 𝐧𝐞𝐰 𝐛𝐨𝐚𝐫𝐝 𝐦𝐞𝐦𝐛𝐞𝐫𝐬. This would protect smaller investors from being sidelined and reinforce the principle that listed companies are not private fiefdoms, but public enterprises governed with transparency and accountability.

The time for symbolic gestures is over. Real reform means setting consequences for those who abuse their positions, and structural safeguards for those who invest in good faith. 𝐀 𝐬𝐞𝐜𝐭𝐨𝐫 𝐛𝐚𝐧 𝐢𝐬𝐧’𝐭 𝐚 𝐩𝐮𝐧𝐢𝐬𝐡𝐦𝐞𝐧𝐭 — 𝐢𝐭’𝐬 𝐚 𝐩𝐫𝐞𝐫𝐞𝐪𝐮𝐢𝐬𝐢𝐭𝐞 𝐟𝐨𝐫 𝐫𝐞𝐬𝐭𝐨𝐫𝐢𝐧𝐠 𝐜𝐫𝐞𝐝𝐢𝐛𝐢𝐥𝐢𝐭𝐲 𝐢𝐧 𝐭𝐡𝐞 𝐠𝐨𝐯𝐞𝐫𝐧𝐚𝐧𝐜𝐞 𝐨𝐟 𝐁𝐞𝐥𝐠𝐢𝐚𝐧 𝐜𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬.