RBS has rejected calls to set up a shareholder committee as part of its corporate governance structures.

Small shareholder body ShareSoc reacted by vowing to fight the decision, and calling it “unreasonable obstruction of shareholder democracy”.

ShareSoc chairman Mark Northway said: “It is disappointing that, instead of leading from the front on corporate governance, RBS have instead chosen to try to thwart this initiative.

“This behaviour by the directors of a company that is majority owned by the UK government underlines the broad reticence of UK boards to address the breakdown of the agency model and the rights of shareholders.

“There is more work to do at RBS before the government places its 73% holding back into the market.”

Scotland’s Herald newspaper reported the bank as saying it prefers to use the model outlined in the UK government’s green paper discussion document, which proposes stakeholder engagement involving employees and suppliers in addition to shareholders.

The Herald quotes RBS chairman Howard Davies saying he believes the bank should be “strengthening the voice of employees, our customers and wider stakeholders.”