Damian Walsh, Partner and Head of the Board and CEO practice at Savannah Group is leading a call-to-action for a change in the way corporate governance is measured, and with this a UK wide programme of board reviews and renewals. He is putting this task firmly at the feet of the Chairman of each and every FTSE 100 and 250 company.
Quite simply, the current measurement techniques for corporate governance is failing as a barometer of corporate success and is in desperate need of a shake-up. The current box-ticking – where quotas are becoming more important than quality – approaches are ineffective. They show absolutely no correlation between good governance and total shareholder return. After all, Carillion – and many of high-profile corporate failures – looked great on paper.
What current measures of corporate governance are failing to address is the competence and relevance of the individual directors and their effectiveness as a team. Unlocking and opening up board positions for a wider, more diverse pool of talent will help to bring in fresh ideas, approaches and experience.
Walsh believes that unless this is addressed soon there is a major risk that the FTSE 100 will continue to under-perform compared to its global peers. Not only will this damage the reputation of UK PLC, but it also risks further government intervention in the form of unnecessary regulation.
In addition to discussing the findings of a recent research report by Savannah into the current state of corporate governance, he can also give his opinion on those Chairmen who are getting it right. And those who have learned – or are learning – from their mistakes.
View the report here.