“ It is difficult
to get a man
to understand something,
when his
salary depends
upon his not understanding it! ”
 
Upton Sinclair

There is plenty of press coverage as to the outrage of the public regarding the failure of highly paid company senior executives, especially in Banks, to manage risk in their businesses resulting in huge losses and consequent redundancies of the much lower paid staff. Blame is now being apportioned to anyone who holds responsibility and in particular the Chairman, Chief Executive and Non-Executive Directors (NEDs) on the Board.

There are now tougher measures to ensure that Officers of the Company and Non-Executives take their responsibilities more seriously. The UK corporate Governance Code has been published to replace the Combined Code and The FRC has published in March 2011 guidance on Board Effectiveness to cover the following:

• The Role of the Board and Directors
• Board support and the role of the Company Secretary
• Decision making
• Board composition and Succession Planning
• Evaluating the Performance of the Board of Directors
• Audit Risk and Remuneration
• Relations with Shareholders