The corridors of power …

Her performance in Brussels last week, when she held key talks with Harvey Pitt, chairman of the US Securities and Exchange Commission over the contentious legislation rushed through after Enron, is known to have impressed the prime minister.

Pitt was in Brussels to listen to deep-seated worries about the so-called Sarbanes-Oxley Act which threatens to bind foreign firms and companies to US laws.

It is accepted in Downing Street that Johnson’s intervention played a not inconsiderable part in the outcome which, at the least, is the possibility of a compromise.

European companies using the US capital markets are looking for exemption from these new laws which are considered heavy-handed and stretch beyond the shores of the United States to affect such foreign companies.

Pitt stressed that scandals and corporate governance are not simply US problems and that was why the new laws had been framed in the way they had.

But Johnson was quick to point out that the US laws were not appropriate in the UK where she claimed corporate regulation was markedly different from the US.

After the meeting Pitt told his colleagues that she had gone a considerable way to convincing him that UK practice was more robust than that of his own country.

Johnson was candid enough to admit, however, that it was not impossible for an Enron-type collapse in this country.

But it was partly her candour and partly her comprehensive exposition of UK rules which may have driven Pitt to consider exempting areas of Europe from this new legislation.

  • Chris Moncrieff, a senior political analyst at PA news.

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