Tuesday, 30 November 2010

UK: the Government's Growth Review and corporate governance

HM Treasury and the Department for Business, Innovation and Skills published a policy document yesterday titled The path to strong, sustainable and balanced growth: see here (pdf). The document refers to the Government's review of corporate governance and states (at paras. 1.42 and 1.43):

For a more competitive economy, the Government must also ensure that long-term growth is not compromised by short-term volatility, or that its benefits are captured by a few at the expense of the many who provide the capital. The Government has launched a review into corporate governance to investigate issues including the problems of short-termism, investor engagement, directors’ remuneration, and the economic case for takeovers. This will be one of the Government’s priority areas over the coming months. The Government will also consider the role of directors and shareholders and ask fundamental questions about shareholder engagement, market short-termism and the long-term sustainability of UK companies".

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