NAPF attacks companies for violations
The National Association of Pension Funds has criticised a number of the UK's leading companies for violating corporate governance rules.
The NAPF surveyed the top 350 listed companies in the UK to analyse compliance with the London Stock Exchange’s Combined Code on corporate governance, finding a number of violations.
The association found 54% of companies failed to ensure the independence of remuneration committees, and that nearly half had contract periods for executive directors exceeding the recommended 12-month period, including Cable & Wireless and SmithKline Beecham.
A small number, 7%, had failed to split the roles of chairman and chief executive.
These included PowerGen, Anglo American and ARM Holdings.
Bass was also identified in the survey but has recently split the role.
NAPF identified that 16% failed to meet the Code’s requirements on the membership of their audit committees.
The association also reported a number of companies that had failed to identify a senior independent director.
The survey showed there was straightforward non-compliance among 23% of the companies, though in a further 13% the independence of the director was questionable.
NAPF acknowledged that the position on overall compliance with the Code was better than the previous year but believed there was still room for improvement.