CBI calls for annual review of directors

CBI calls for annual review of directors

All board directors should be forced to face an annual performance review to ensure they are able to make a full contribution to the running of their company.

Link: IoD defends UK corporate controls

Such a move would flush out directors who had too many non-executive positions and were unable to cope with the demands of individual companies.

The proposal was put forward this week by the Confederation of British Industry as part of its submission to the government’s review of non-executive directors, chaired by Derek Higgs.

‘Every single company should have an annual performance review of every single board member,’ Digby Jones, secretary general of the CBI said.

The move would prevent ‘serial directorship’ directors, who over-stretched themselves and failed to spend adequate time with individual companies.

The CBI also called on non-executive directors to give a full explanation if they resigned from a board prematurely.

‘If there is a real problem in a business, it is very easy for a non-executive to say I’m out of here and I’ll claim I need to spend more time with my family,’ said Sir Nigel Rudd, chairman of the CBI’s boardroom issues committee.

But the CBI said making such disclosures public would be ‘divisive’, instead preferring the reasons for resignation to be passed on to all board members via the chairman of the company.

The CBI also called for greater shareholder involvement in setting original contracts with executive directors to avoid the perception of massive pay-offs for ‘failure’ if an executive were forced to resign.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource