Ummmm....not quite.
This will come down to whether the board have sufficient evidence to prohibit a member from standing for election as a director (this is different from sacking an incompetent employee). An internal audit may well raise several questions regarding operations, which may include issues of efficiency, mismanagement, gross negligence and extending to potential fraud issues. Now, to stop someone from standing for election (as opposed to firing an employee for not doing their job well) you are going to need evidence towards the nastier end of that scale. And if you have that, the issue should not stop at a 2 year ban from standing for election. I'd be stunned if there's not a legal challenge to the directive (unless further other action by the Board is forthcoming).
While criminal prosecutions are based on the 'beyond a reasonable doubt' idea, criminal charges are not (and no suggestion of criminality has been made in this case).