02 December 2009
New business regulations proposed
Proposed reforms of the UK's Corporate Governance Code have been put forward.
The Financial Reporting Council (FRC), which is an independent regulator that helps to shape UK and influence European Union and global approaches to governance, has launched a consultation on the planned changes.
They are designed to take into account the lessons of the financial crisis.
Chairman of the council Sir Christopher Hogg suggested that the principal message that should be gleaned from the credit crunch is that individuals on boards must think deeply about their individual and collective roles and responsibilities.
"The FRC has not found evidence of serious failings in the governance of British business outside the banking sector. However, the proposed changes to the code are in our view sensible improvements," he stated.
Among the proposals put forward by the organisation was one concerning performance-related pay. The council suggested such remuneration should be aligned to the long-term interests of firms and to their policies on risks.