UK: BBA conference speeches

The British Bankers' Association held its Annual International Banking Conference yesterday. Many of the speakers considered corporate governance; their speeches are available here. In his speech, the Financial Services Secretary to the Treasury, Lord Myners, observed:

It is clear that corporate governance failures materially contributed to the financial crisis. The OECD’s assessment is stark: weaknesses in remuneration, risk management, board practice and the exercise of shareholder rights resulted in excessive risk taking. These issues must be addressed. The UK is a thought leader in addressing such issues: through the FSA’s work on remuneration and director quality; through Sir David Walker’s review of the governance of financial institutions; and with the FRC’s current review of the Combined Code.

But I believe that our journey of reflection needs to take us to a deeper level than previous expeditions under the captaincy of Cadbury and Higgs etc. In particular, many of the tenets of modern portfolio theory and the presumed strong version of the efficient markets hypothesis deserve to be questioned".