Dolphin Hotels PLC Discloses Non-Compliance with CSE Corporate Governance Rules

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Colombo, 13 August 2026 – Dolphin Hotels PLC has officially informed the Colombo Stock Exchange (CSE) of its non-compliance with several key corporate governance requirements, effective August 7, 2026. The announcement, made public on August 12, 2026, details deficiencies in the composition and chairpersons of various crucial board committees.

The non-compliance stems directly from the redesignation of Mr. T. Dharmarajah from an “Independent Director” to a “Non-Executive Director” on August 7, 2026. This change has impacted the company’s ability to meet the stringent criteria set out in the CSE Listing Rules for the composition of its governance committees, which mandate a minimum number of independent directors and independent chairpersons.

Key Areas of Non-Compliance

Dolphin Hotels PLC, which currently has a Board of Directors comprising six members, highlighted specific breaches across five essential committees:

Remuneration Committee

  • Composition (Rule 9.12.6.1 (a)): The committee currently comprises one Independent Director and two Non-Executive Non-Independent Directors, failing to meet the requirement of a minimum of three directors, with at least two being Independent Directors.
  • Chairperson (Rule 9.12.6.2): The Chairperson of the Remuneration Committee is no longer an Independent Director, a direct contravention of the rule.

Nominations and Governance Committee

  • Composition (Rule 9.11.4.1 (a)): Similar to the Remuneration Committee, the Nominations and Governance Committee has one Independent Director and two Non-Executive Non-Independent Directors, falling short of the required minimum two Independent Directors.
  • Chairperson (Rule 9.11.4.2): The Chairperson of this committee also ceases to be an Independent Director with the redesignation of Mr. Dharmarajah.

Audit Committee

  • Composition (Rule 9.13.3.1 (a)): The Audit Committee’s current makeup of one Independent Director and two Non-Executive Non-Independent Directors does not satisfy the rule requiring a minimum of two or a majority of members, whichever is higher, to be Independent Directors.
  • Chairperson (Rule 9.13.3.4): The rule that an Independent Director shall be appointed as the Chairperson of the Audit Committee is also not being met.

Related Party Transactions Review Committee

  • Composition (Rule 9.14.2): This committee currently consists of one Independent Director and three Non-Executive Non-Independent Directors, whereas the Listing Rules stipulate a minimum of three directors, with two members required to be Independent Directors.
  • Chairperson (Rule 9.14.2 (1)): The Chairperson of the Related Party Transactions Review Committee is also no longer an Independent Director.

Rectification Plan

Dolphin Hotels PLC has declared its intention to rectify all identified non-compliances at its upcoming Annual General Meeting (AGM), which is scheduled to be held on or before September 30, 2026. The company’s declaration confirms that it will remain non-compliant with the aforementioned Corporate Governance requirements of the CSE Listing Rules until this rectification takes place at the AGM.

Corporate governance is a cornerstone of investor confidence and market integrity within the Colombo Stock Exchange. Listed entities are mandated to adhere to these rules to ensure transparency, accountability, and the protection of shareholder interests. Dolphin Hotels PLC’s swift disclosure of these breaches and its proposed rectification timeline demonstrates its commitment to eventual compliance.

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