Tuesday, 24 November 2009

Walker Review - what can we expect?

There was a lot of speculation in the papers this weekend about possible changes to the Walker Review recommendations. Most focus has been on this issue of disclosure of remuneration arrangements for highly-paid individuals below the board. Walker proposed this should be in bands, but others had pushed for individual details to be disclosed. According to reports in the papers it probably will be bands after all.

Cue much outrage from various quarters, but actually I'm not so sure. Firstly, it is the structure of these arrangements that is the most important. Secondly, as someone pointed out to me this afternoon, if investors want this information why don't they just ask for it? If institutions collectively called on BOFIs to disclose the data, could they really refuse? The problem is - as always - that very few institutions show any desire to take such an approach.

It also sounds like Walker will tweak the recommendation on non-exec time commitments. This is because of concerns that such a rule could stop chief execs from acting as NEDs on other boards. This was basically what he said to the Treasury select committee a couple of weeks back so I expect to see it.

There hasn't ben much speculation about the proposals on shareholder engagement which presumably means - if Walker has successfully stood his ground against the conservative end of the asset management business - that we can probably expect to see them unchanged. I'm interested to see if he has picked up on any of Paul Myners' ideas in respect of voting rights and, more recently, the need for a new investor representative organisation.

And fingers crossed for some movement on voting disclosure, but I'm not optimistic...

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