Walker set to give go-ahead for tighter rules for directors
SIR David Walker will put forward plans for a major renovation of boardroom culture among UK financial institutions today, with the publication of his review of corporate governance.
Walker is expected to set out a series of radical proposals, which will include subjecting company directors to mandatory annual elections and the introduction of powerful risk committees strong enough to resist pressure from executives.
The City grandee, called in by the government to overhaul corporate governance, may also call for shareholder votes on remuneration reports to become binding, rather than simply advisory, in a bid to increase investor influence on corporate strategy.
Walker is understood to believe that the dislocation between shareholders and the companies in which they invest is a key factor contributing to the severity of the financial crisis. His proposals will also include forcing non-executive directors to receive formal training in the activities of the companies they represent, while they will be discouraged from taking too many boardroom roles.
The government is set to use Walker’s report to feed into proposals to curb risky pay policies and beef up risk management.