Consultation breeds dissent
Sunday 12 January 1997
Each organisation responding to the consultation exercise put out by the Cadbury Committee's successor, led by Sir Ronnie Hampel, chairman of ICI, is fighting its own corner.
Accordingly, the proponents of Tomorrow's Company, a group investigating the secrets of sustainable success, called at the end of last year for the Cadbury and Greenbury Codes to be scrapped in favour of a general framework promoting business values. And last week the Institute of Chartered Accountants said that good corporate governance rested firmly with the boards of companies. Shareholders and auditors could "necessarily only play a secondary role", it added.
Building strong, balanced boards with effective non-executive directors would require amending the Cadbury Code to: demand rather than recommend that the chairman and chief executive roles be split; to strengthen references to non-executives to stress the importance of independence so that former executive directors, for instance, would not qualify; and to make all directors subject to re-election at least every three years.
The paper, from the institute's corporate governance group, also asks for consideration to be given to a requirement that all directors of listed companies pass a "fit and proper" test.
Sir Brian Jenkins, chairman of the group, says: "The key to good governance lies in getting the right board in place. A company with a properly balanced board and effective independent directors should be left to run its business, with the board being held accountable for its stewardship."
Meanwhile, the Institute of Personnel and Development points out that it is "easier for potential investors to find out about a company's environmental record than the skills and experience of their employees".
It argues that the way people are managed affects the share price and is calling for the Hampel committee to encourage organisations to publish annual statements showing the link between their people management and business objectives.
John Stevens, the IPD's director of professional policy, says: "To be successful, businesses need flexible, motivated and efficient people. It is time the City acknowledged that people are the most important asset, and that the way they are managed can have a critical effect on shareholders' dividends."
- 1 Home Office says Nigerian asylum-seeker can’t be a lesbian as she’s got children
- 2 What happens to your body when you give up sugar?
- 3 Drugs Live cannabis trial: Hash is less harmful than any other drug, expert claims
- 4 Turkish Airlines flight TK 726 crash-lands on Nepal runway amid dense fog
- 5 Apple and Google users being spied on for a decade because of 'Freak' security flaw
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
Ukip would cut billions from Scottish budget to fund English tax cuts
End of the licence fee: BBC to back radical overhaul of how it is funded
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
Boris Nemtsov shot dead: Outspoken Putin critic who had expressed fears for his life is killed near the Kremlin
iJobs Money & Business
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...
£36,000 - £40,000: Christine McCleave: Are you looking for a new opportunity a...
£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...