‘Box-ticking’ Higgs may be watered down

Higgs report in detail

This was the suggestion, following statements made by the Financial Reporting Council, the new independent accounting watchdog.

The FRC was reported in the Times as saying: ‘Obviously we are not going to chuck the responses out.’

Complaints against Higgs include the recommendation that a company chairman be banned from heading up the nominations committee and the recommendation that senior independent non-execs consult directly with shareholders.

FTSE 100 member Legal & General complained about the ‘box-ticking’ mentality of the report. It said the philosophy of ‘comply or explain’ was too prescriptive.

The FRC is using the Higgs report and the accompanying Smith report on audit committees to draw up a new code of conduct for corporate governance.

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