More than 60 per cent of bosses back corporate governance reform

More than 60 per cent of bosses support sweeping reforms to corporate governance, according to a survey by the Institute of Directors (IoD).

The IoD surveyed 34,000 company directors to help shape its submission to the UK government’s consultation on corporate governance, which closes on Friday.

Stephen Martin, director general of the IoD, told The Herald: “For small companies, any new reporting requirements would be excessive, but there is a real appetite in the business community for a new code for large private firms.

“A private code would have to be less prescriptive than the one for listed corporations, based on broad governance principles rather than a lot of tick-box compliance.

“If they get this right, the Government could really help to make boardrooms more transparent, and improve the functioning of these companies.”

He also said there was “too little transparency around executive pay” at the UK’s largest listed companies and this had led to a loss in public confidence.

Mr Martin said: “The IoD has warned for some time that executive pay at the UK’s biggest companies is posing a threat to the reputation of all businesses, and we’ve called on boards to simplify and moderate pay.

“The year’s AGM season will be a big test for the FTSE. If boards don’t get out in front of shareholder and public anger, they will only push politicians closer to regulating.”