The Sunday Times has run a piece on March 1st on the divided governance landscape with respect to the subject of making senior directors liable for credit sanctions. The article, entitled Beware the boardroom blame game by Carly Chynoweth, says that all NED are alike, except for financial services, where, under the proposals, the chairman, senior NEDs and committee chairs will fall into a new scope of the senior management regime which aims to hold directors to account.
The proposal would mean that senior NEDs in PRA regulated firms would be held personally liable for company actions and need to be formally approved by the regulator before taking the post. The BBA has welcomed the proposals while others, such as Peter Hahn, a senior fellow at Cass Business School, fear that a system of two tier boards may develop with such a regime. The article quotes Martin Wheatley, CEO of the UK FSA, as saying "including all NEDs would be risk changing the whole nature of this vital role".
What do you think?
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