Director of investment affairs Peter Montagnon told BBC Radio 4’s Today Programme on Saturday that Myners was correct to identify the problem of the “ownerless corporation” but warned that creating different classes of shareholder or limiting the right to sell shares at any time would have dangerous implications.
He said: “In what he is saying there is a lot of danger, because if you tell institutions that they can’t sell whatever happens, then they are sometimes going to have to hang on and cause their customers and clients – who are savers and pensioners – a loss because they can’t sell. You have to retain the right to sell even when you want to engage as a good owner.
Montagnon suggested the French system which offers greater voting rights to long-term investors encouraged companies to assemble a core of committed investors with an interest in supporting the board rather than demanding enhanced accountability.
He warned that discriminating between the kinds of shareholders could damage confidence in the market.
He said: “We need to do more to build up a critical mass of good long-term shareholders who are going to work together to solve this problem.”