Sir Richard Sykes, one of two directors of the ENRC mining giant ousted last week in a boardroom coup, is calling for the Finacial Services Authority to tighten up its listings rules following the latest feud over corporate governance.
Sir Richard, the ex-deputy chairman of the London-listed Kazakh miner and his fellow independent director, Ken Olisa, were removed from the 14-man board after a vote by ENRC's founding shareholders who claimed they were tired of the two interfering. Two other independent directors, Sir Paul Judge and Mehmet Dalman, are said to be considering their positions.
The former chairman of GSK, Sir Richard, said on Friday: "There are serious questions to be raised about the corporate governance of companies like ENRC. It should never have been allowed to list on the London exchange with such a small free float and such dominant shareholders."
Sir Richard added that the experience has been "more Soviet than City", claiming that the founding oligarchs – known as "the trio" – are mad. "You can quote me on that. It's time for a much tougher regime, otherwise London's reputation will be damaged," he said.
Sir Richard said companies should not be allowed to float unless a minimum of 25 per cent of the shares are listed. "There should be no exceptions. There are many other issues that need to be looked at but this is one of the first things to be done to control firms like ENRC that have only a few dominant founding investors."
Sir Richard, a former rector of Imperial College, joined ENRC when it floated in 2007, but says it should not have been allowed to list with a free float of only 18 per cent. "I was excited and hoped to do a worthwhile job. I had a lot of mining experience, but soon realised I was banging my head against a brick wall because the other Kazakh directors didn't listen."
The founding shareholders – Alijan Ibragimov, Alexander Machkevich and Patokh Chodiev – were supported by Kazakh government representatives on the board.