Link: Higgs special report
As the FRC deadline for submitting responses for the consultation process passed earlier this week, yet more opposition to the way the code has been set out has emerged from the London Stock Exchange, while it has also been reported that many of the executives on the FRC are opposed to the proposals.
‘We are for Higgs, but for Higgs to be translated into a revised code in a different way,’ said Don Cruickshank, chairman at the LSE. He argued that the number of rules contained in the current code could create a mindset of ‘anything is allowed as long as it is not precluded’.
On the other side of the debate, leaders of major fund management companies have warned the FRC not to delay the implementation of the code or to make far-reaching changes to its structure.
In a letter to the Financial Times, the heads of investment firms, such as Axa, Hermes, Schroder, Jupiter and ISIS, said that some ‘constructive refinement’ of the code’s wording may prove useful, but wholesale changes were not necessary.
Accounting firm RSM Robson Rhodes also warned that the cost to UK plc of implementing the changes suggested in the Higgs report could be as much as £200m. This includes additional costs for headhunting, training, evaluation and increased salaries, amounting to about £100,000 for each of the UK’s 2,000 quoted companies.