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Liberty chairman hits out at Higgs

Katherine Griffiths
Thursday 13 February 2003 01:00 GMT
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Donald Gordon, the chairman of Liberty International, became the latest high profile businessman to hit out at Derek Higgs' review of British boardrooms yesterday.

Mr Gordon used the shopping centre group's first set of results as a FTSE 100 company to attack Mr Higgs, saying aspects of his report could be a "nightmare" for business. Unveiling a 9 per cent rise in pre-tax profit to £87m in the 12 months to 31 December, Mr Gordon also stepped into the Higgs debate: "Frankly I don't think it will work."

Mr Gordon warned proposals to make the majority of boards non-executive directors who are fully independent of the company's management would be particularly difficult to implement and would require him to replace 10 non-executives at Liberty, including his son Graeme.

Other non-executives who would fall foul of Higgs are Douglas Leslie, managing director of Liberty's subsidiary Capital Shopping Centres. Michael Rapp also breaches the guidelines because he used to be an executive director.

"It takes five years for non-executives to get to know the business and then probably half are no good anyway. We are not a business school," Mr Gordon said.He defended his breach of Mr Higgs' recommendation that a chief executive should not become its chairman, saying: "The record of people appointed as chairman from outside the company shows that half go belly up."

Mr Higgs, who was appointed by the Department of Trade and Industry to consider ways to boost the role of non-executives, rounded on his critics. "Mr Gordon has his views but you wouldn't expect me to agree with them," he said.

He also rejected speculation that the new level of rigour his review will require of public companies could put some off from listing on the stock market.

"Companies go public for access to capital. And there are a number of new issues in the last few years which possibly should not have gone public without some differences in corporate governance," Mr Higgs said.

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