As a serial company chairman, I have witnessed or perpetrated a good many of the cardinal sins of corporate governance by today’s standards. So it was a bold move by the government to appoint a “poacher” to chair the Financial Reporting Council, keeper of the combined code on corporate governance. An important motive was to ensure effective consultation with business leaders and to promote best practice in a system that benefits from being voluntary rather than statutory.
In this spirit, my first quest was to ask my erstwhile peers who chair FTSE 100 companies what they thought of the combined code, three years after the substantial revisions that flowed from the Higgs report on non-executive directors (NEDs). I expected perhaps 30 to respond to my request to meet them. In the event, I met more than twice that number face to face and several more responded in writing.
The starting point was to air criticisms of the code. Most chairmen still believe it is over-prescriptive and underplays their role.
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