Anne Simpson, of Pirc, the pensions and investment research group said: "It has a rather blancmange-like quality. We feel the need for clarity and vigour is as great as it ever was. There are so many qualifications [in the code]."
It is understood that the final Hampel supercode which will incorporate the Cadbury and Greenbury codes, will be largely unchanged from the draft document which adopted a light touch and was seen in some quarters as a let-off for the business community. This is in spite of the Stock Exchange receiving over 150 submissions about the original document, many of which are thought to have been critical.
Pirc has taken issue with several points, including the nomination of a lead non-executive director. It suggests it would more valuable to insist on an independent non-executive chairman and for companies to list the biographies and business connections or non-executives so that investors can assess their independence more easily.
Smaller public companies will be able to flaunt the code as long as they detail in their annual reports where it does not comply with the code and why.
The code will also be toothless. Though it will sit alongside the Stock Exchange's listing requirements, it will be voluntary and companies which do not comply will not be disciplined if they state their reasons.
However, the lenient attitude to smaller companies was welcomed by David Stevenson, corporate finance partner at Eversheds, the law firm. "It can be difficult for smaller companies to find the right kind of people for these non-executive roles. If they were pushed by the code it might lead to them appointing the wrong person."Reuse content