In a response to the Walker Review, the IMA supports ruling out legislative proposals and not adopting a rules-based approach and says managers have an important role to play in ensuring good governance but argues they do not run companies, set strategy or have inside information.
IMA corporate governance director of Liz Murrall says: “We think that proposals that address systemic issues, such as risk and remuneration, in banks and other major financial institutions should be implemented by way of FSA guidance rather than via the combined code as is suggested.
“The combined code applies to all listed companies – not all financial institutions that pose systemic risks are listed, and many listed companies do not give rise to systemic issues.”
The Walker Review looks at the future of corporate governance in the financial services industry and proposes measures to improve the quality of bank boards.
Sir David Walker is expected to publish his final recommendations at the end of November.