UK: the Plan for Growth and corporate governance

HM Treasury and the Department for Business, Innovation and Skills published A Plan for Growth yesterday, described in its introduction as "an urgent call for action": see here (pdf). The document contains a section on corporate governance, defined as "the framework established through legislation, regulation and practice by which companies are directed or controlled" (para. 2.133). In this section proposals are outlined which, in the Government's view, will improve corporate governance, including:

• Reducing the number of companies required to be audited and pressing the European Commission to remove the audit requirement for most medium sized companies as part of a revised audit directive (expected, the Government states, in November 2011).
• Changing the law in 2012 to exempt many subsidiaries from producing audited accounts and encouraging the European Commission to exempt the smallest companies from reporting requirements.
• Requesting the Office of Fair Trading to investigate whether clauses in lending agreements made by banks are unfairly restricting competition in the audit market [in this context, the report refers to work by the OECD, available here (pdf)].
• Simplifying the narrative reporting requirements for quoted companies (views will be sought from business by the end of July 2011).
• Modernising the legislative framework governing mutuals. 

The Government also explains, at para. 2.139, that it will publish in the summer this year "the next steps" of its review of corporate governance and economic short-termism.