Would more time in the classroom improve the boardroom?
8 Dec 08
Very interesting conference last Friday. ICAS, supported by PricewaterhouseCoopers, brought together a panel of leading CAs to discuss the main corporate governance issues that have been thrown up by the recent problems in financial markets
Norman Murray, Chairman of Cairn Energy PLC; Frank Blin, Executive Chairman, Scotland, PricewaterhouseCoopers; Guy Jubb, Head of Corporate Governance, Standard Life Investments and Ian Paterson Brown, Chief Operating Officer, Ignis Asset Management all gave an excellent contribution to a lively debate with full audience participation.
Around 100 CAs attended and most filled in an ‘exit poll’ with 5 questions related to the issues discussed on the day.
The size of the positive response to one question surprised me. Some 84 per cent of respondents believed that non-executive directors should receive compulsory education and training to help them carry out properly their duties on the board.
I know that many non-executives already receive a proper induction process and are given open access to see at first hand their company’s locations and processes, but many aren’t so lucky. The increasing complexity of modern business means that non-executives need as much help as they can to understand the businesses that they are involved in. The need to understand business risk was possibly the strongest theme running through Friday’s event. The argument goes that a compulsory education process isn’t a bad way of helping our boardrooms to stay on top of all this.
Ultimately of course, this would need to be implemented by regulators. The ‘comply or explain’ nature of the Combined Code may mean that compulsory training and education goes against the grain. As every good board member would admit, the wisest mind has something yet to learn. Should regulation now require them to do that?