Corporate governance and the fate of NEDs

摘要

Reasonable risk-taking is a necessary part of business but risk aversion could become the preferred stance of non-executives. Many hopes for the improvement of standards of corporate governance depend upon the role of non-executive directors (NEDs). Since the Higgs report on corporate governance was published in 2003 and largely endorsed, the workload and responsibilities of NEDs have multiplied. At the same time, there has been a tendency to expect that non-executives should have relevant skills and experience. Doubtless this has been a sensible development but it has had the effect of increasing expectations and the risks that non-executives must accept.