Link: Higgs special report
Both the Institute of Directors and the Confederation of British Industry agreed that concerns that appeared following the release of the report relate more to the way the combined code, which the report’s recommendations have been incorporated into, has been structured.
‘The problem is with the code rather than the text of the report,’ said Patricia Peter, corporate governance executive at the IoD. ‘We have concerns that it is too prescriptive and that even well known and respected firms may struggle to be in compliance.’
Peter added that it would be submitting its response to the Financial Reporting Council’s consultation process this week and makes many similar points to that which Wyman made at the annual ICAEW dinner last week.
The concern over the code was also echoed by CBI director general Digby Jones, especially relating to how ‘comply or explain’ might be interpreted. ‘Derek Higgs’ good intentions could become institutionalised over period of time so the only imprint left on the mind of the over zealous regulator or fund manager is “comply”,’ he said.
Wyman said that so far there had been no negative reactions to his speech, which recommended that the code be completely rewritten.
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