As the company’s 13 non-executive directors sit down around the expansive boardroom table, it seems like a normal day at the office. Only this time extra seats are needed – 13 more in fact, each to be filled by a lawyer engaged by each of the non-execs in attendance.
It may be an apocryphal tale but if it’s a scenario that has not been witnessed already, expect to it to happen some time soon.
There has been so much corporate governance legislation on both sides of the Atlantic over the last year that keeping up with the new rules is a full-time job.
Much of that reform is requiring non-execs to take a more active role in policing company affairs – and with that additional power comes additional accountability. No wonder the lawyers are close by.
In the UK at least it is the Higgs report driving this. But Higgs has only been part of the reform story. Ever since the problems at Enron first surfaced, battalions of regulators and scores of hastily-formed committees have been asking themselves two questions: could it happen here and how can we ensure it doesn’t.
/i> made an early contribution to the debate when we published our manifesto last January. The proposed reforms went wider than Enron – indeed Andersen was still a brand name worth fighting for then.
But last week saw perhaps the most significant intervention – publication of the keenly-awaited DTI report on the future of the accountancy profession.
You could be forgiven for thinking it a damp squib though one senior partner tried to present it to me as ’20 lashes when we could have had 30′.
No one would argue that the DTI has not shaken accountancy to its foundations.
However, the accountancy industry is not off the hook yet.
A sniff of scandal and expect those committees to be hastily recalled.
- Damian Wild is editor at Accountancy Age.
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