Well the rumours were true, the Financial Reporting Council has backed annual election of all directors, though only for the FTSE350. Quite a reasonable decision IMO since the threat of an entire board getting vote out has some validity in smaller companies. But to be honest I suspect they will move to annual elections in time too.
It will also be interesting to use this reform as a test case for future governance changes. Remember, opponents have argued that it will lead to more short-termism. Well, they've put forward the hypothesis and now we get to try the experiment. If, as I expect, there is no noticeable shift of this kind (nor numerous directors getting booted) this will be useful ammo for next time we hear these kinds of reactionary arguments.
To be honest, if I were lobbying against annual elections I would have used the futility Hirschman Special - it won't make any difference. You could back this with the stats showing how little opposition directors face to suggest that investors don't really use the power they have, so why extend it. I don't agree, but it's more plausible than the "Giant snakes will roam the land" taken line by companies (and some investors) opposed to the change.