IOD Manifesto: Corporate Governance
Corporate governance is a key driver of business behaviour and economic performance. Improving the standards of governance at UK firms is a crucial endeavour, helping to safeguard against preventable failures. And yet it historically tends to feature very sparingly in the manifestos of most political parties. To fill this gap, the IoD is proposing 10 policy initiatives which will reinforce the UK’s pre-eminent position in the global corporate governance space. Several of these proposals offer lawmakers a governance mechanism through which business can regain the trust of wider society while at the same time avoiding an extreme lurch to heavy-handed regulation or outright nationalisation. For example, the introduction of a code of conduct for board members could exert a significant impact on business behaviour. And the establishment of a new legal vehicle through which to organise government outsourcing activities – the Public Service Corporation – represents an innovative way of achieving balance between various stakeholder interests in an increasingly politicised area of the economy. These proposals are illustrative of an emerging policy trend – the growing role of corporate governance in addressing a wide range of economic and social challenges, not least the overwhelming issue of climate change.
Director General, Institute of Directors