BusinessCorporate FinanceWalker proposes non-execs for buyout companies

Walker proposes non-execs for buyout companies

Greater financial transparency and corporate governance improvements central to private equity review

Sir David Walker will today reveal details of a review on transparency and
corporate governance among the UK’s larger private equity-backed companies.

The review, the PE industry’s first response to scathing criticism from
politicians and union leaders, is expected to float the idea of buyout firms
appointing external, non-executive directors to the boards of some companies
bought by private equity, reports the
Financial
Times
.

Sir David is expected to propose a code of conduct that would only apply to
buy-out firms that have acquired companies above a certain size, equivalent to
the FTSE 250 index, to be measured by the value of the acquired company and the
size of its workforce.

Proposals will include a recommendation for more disclosure about the
performance of buy-out funds. Sir David will urge regular communication with
staff at portfolio companies, and much greater disclosure on the debt structures
of portfolio companies, including repayment schedules and covenants for loans.

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