Baroness Hogg will have to call on her years of experience for her new role as chairman of the FRC
Baroness Hogg, current chairman of the FTSE 100 private equity kings 3i, is
to become chairman of the Financial Reporting Council. That places her at the
centre of the some of the most hotly contested regulatory debates affecting the
Lady Hogg will take over from the current chairman of the FRC, Sir
Christopher Hogg, in May after her appointment was announced by business
secretary Peter Mandelson.
And she’ll have time on her hands. Lady Hogg is about to end her long
association with 3i. Her resignation as chairman came towards the end of last
year, though reasons for her departure have yet to emerge.
Her association with the City goes far beyond 3i. Her career began as a writer
at The Economist in 1967, where she became economics editor. She went on to work
for many newspapers, including The Times, The Independent and The Daily
Telegraph, as well as a short spell at Channel 4 News.
In 1990 she became the head of John Major’s policy unit and later wrote a
well-known book about the then Prime Minister, Too Close to Call.
She has a lot of experience to call upon, which is exactly what she will need
when navigating the murky regulatory waters of financial reporting.
What happens next?
The two-day-a-week role will offer Lady Hogg the ability to pick and choose
which areas she wants to concentrate on.
Sir Christopher Hogg’s involvement with governance issues owes as much to his
personal interest in the area, as it does to his corporate background. As head
of the governance committee within the FRC, Lady Hogg will likely continue this
involvement. This will see her front and centre when the body releases its new
corporate governance code, currently on exhibition.
This week’s release of a new code for the audit industry will put her in an
unprecedented position, the head of a body that is the custodian of governance
standards within the audit industry.
The year ahead may also see Lady Hogg wade into the contentious
audit/non-audit area, as she oversees the release of new guidance currently
being investigated by the FRC at the behest of the Treasury select committee.
The investigation is looking at the highly controversial area of restricting the
value of non-audit work an auditor can take from an audit client. The probe
could also lead to increasing transparency around how auditors are selected.
Without her predecessor’s elder-statesman-like presence it remains to be seen
how she will balance the competing political and commercial interests in this
Well-known in corporate and media circles, she has earned vital kudos which
will aid her in dealing with the contentious issues ahead. She is one of two
fresh faces at the FRC, joining the new chief executive Stephen Haddrill, who
began late last year.