Hampel questions boardroom pay rules
Saturday 19 October 1996
The committee, chaired by Sir Ronnie Hampel, the chairman of ICI, yesterday wrote to organisations representing business, shareholder and consumer interests, asking whether the guidelines concerning performance-related bonus schemes needed "refinement".
The letter also canvasses opinion on whether shareholders should have to vote to approve directors' pay packages at annual meetings and whether the Greenbury Committee's recommendation that directors' contracts be limited to one year strikes the correct balance.
This is the first time the Hampel committee has spelt out the areas it is examining since it was set up last November to review the workings of the Cadbury Code on corporate governance and recommend any changes and additions that might be necessary.
Other areas the committee has decided to concentrate on are the role of executive and non-executive directors and ways in which the relationships between owners and managers can be strengthened.
In particular, the committee asks for views on whether unitary boards consisting of roughly equal numbers of executive and non-executive directors is the most appropriate structure for UK quoted companies.
The letter also asks whether there needs to be a division of responsibility between chairman and chief executive - one of the key recommendations of Cadbury - or whether it is enough to prescribe a sufficient degree of independence on company boards through non-executive directors.
Another area being studied is the role of shareholders, particularly institutional investors, and whether they should exercise their ownership rights more actively by, for instance, voting on all resolutions at AGMs and concerning themselves with broader issues such as social, environmental and ethical matters.
The letter, from the committee secretary, John Healey, asks for responses by 31 December. The committee has been asked to report by the end of 1997, although it aims to issue a draft report around the middle of next year.
Christopher Haskins, the chairman of Northern Foods and a member of the Hampel committee, will address the Confederation of British Industry's annual conference in Harrogate next month on corporate governance. The CBI is due to publish a report in the next fortnight strongly backing the concept of unitary boards and rejecting the two-tier boards favoured on the Continent.
The committee is also asking interested parties such as the Association of British Insurers, whether, in reviewing the existing Cadbury code and deciding what needs deleting or adding, it should differentiate between companies by size and type of business.
- 1 Woman accidentally shoots herself in the head while posing for a selfie
- 2 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 3 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
- 4 Female Muay Thai champion hustles coaches to give them a beating
- 5 16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Purity balls: Girls in the US making virginity pledges as fathers vow to 'protect purity'
Female Muay Thai champion hustles coaches to give them a beating
Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
16-year-old girl beaten and burned alive by lynch mob in Rio Bravo, Guatemala
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...