Finance directors are evenly split over increasing the influence of non-executive directors in the wake of the Enron scandal.
In this week’s Accountancy Age/Reed Accountancy survey, 42% of FDs objected to beefing up the role of NEDs while an almost identical 41% favoured increasing influence over their accounting and audit decisions.
One FD said NEDs should only advise on matters of general trading. He said: ‘Accounting and audit discussions should be left to directors and senior managers – who have been employed to carry out that role.’
Another said NEDs already had a ‘fair degree of influence’ but they need to ‘ensure they use it properly’. Another concluded: ‘Lets be honest, they don’t know enough of what’s going on to make any sort of informed decision.’
Among those who wanted the NEDs’ role strengthened, one FD said the Enron scandal had brought the matter to the front of his directors’ minds and as a result they have more influence over accounting and decisions.
The FD of Twickenham Plating Group, Robert Dearing, said: ‘Overall it’s not a bad idea and there’s no reason why they shouldn’t have influence’
However, one stated: ‘Morally yes, but not in my company!’
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