The chairman of a prominent non-executive director network has rejected calls for a new commission on corporate governance in the UK.
Barry Gamble of RussamNED says that non-executive directors are already challenging chief executives.
In a letter for the Financial Times Gamble writes: “There are already in place adequate codes and best practice to guide boards. While not all corporate governance is perfect, the vast majority of non-executive directors work diligently to ensure that executives are always subject to constructive challenge and that disclosures ensure shareholders are kept fully informed.”
Gamble’s letter comes in response to calls for a commission to take a broad look at UK governance.
Anthony Carey, head of board practice at professional services firm Mazars, said in a letter to the FT: “It will be a quarter of century next year since the publication of the Cadbury report and the development of the UK’s first corporate governance code.
“Progress has been made on a number of issues since then, but it would be timely for a corporate governance commission to be set up to look at reforms needed to enable companies to achieve long-term sustainable success that benefits all their direct stakeholders and wider society.”
Carey said a commission could look at corporate values; board composition; and “engagement with and fair treatment of stakeholders, including the setting of remuneration across the business”. Carey said it could also look at shareholders having due regard to the beneficiaries of the shares they hold.
Carey said a commission would support the government’s green paper on governance, which is already under consultation.
Carey’s call came in response to a study from Lancaster University Management School, which found a “negligible” relationship between executive pay and performance.
The authors said: “Our findings suggest a material disconnect between pay and fundamental value generation.”