Non-execs influence to grow post-Enron
The influence of non-executive directors is set to increase in the wake of the Enron scandal, according to a new survey.
But there was a stark warning they would also face greater risks as they came into the firing line of corporate failures.
According to Ernst & Young, two out of three board directors of top 500 companies in the UK said the influence of non-execs would increase, especially in the technology and financial services sectors.
The survey found that the twin pressures of globalisation and difficult economic conditions would ensure non-execs would have more of a prominent role within an organisation.
‘The Enron situation will give further impetus to extending the role that non-executives will be expected to play in the effective running and control of business,’ E&Y’s Gerald Russell said.
But the risks would also increase as their legal responsibilities came to the fore – Lord Wakeham, a non-executive director at Enron, is facing investigation over his role at the failed energy company.