UK: reforming corporate governance - another suggestion from Lord Myners

Today's Financial Times reports another suggestion from Lord Myners, HM Treasury's Financial Services Secretary, regarding bank corporate governance: non-voting shares. The FT reports:

Companies should issue non-voting shares to allow more activist shareholders to take a greater role in corporate governance issues, Lord Myners has suggested, in the latest of a flurry of controversial ideas put forward by the City minister. Under the latest proposal, Lord Myners said companies could make a 1-for-1 issue of non-voting shares to existing shareholders. These could then be traded in the market alongside voting shares.

'Those shareholders who value the right to engage and to vote would tend, if the price was right, to switch their investment from the new non-voting shares they receive into the additional purchases of old voting shares,' he said in a letter to commentary service Breakingviews. 'Investors with no intention of getting involved in stewardship, and who find voting and pressure to do so tiresome, would sell their old voting shares and add an equivalent interest in the new non-voting shares.' "