More red flags are going up related to the growing extent of regulatory creep in the boardroom, according to an article Pinsent Masons relating to its Horizon Lectures Series. It cites Johannna Waterous CBE, a major player on UK boards and business (RSA, Rexam and non-exec at Wm Morrsion), who indicated that strict regulatory measures have gone too far and are having an unwelcome impact on board decision making. "The regulatory tsunami across Britain means that listed company boards are afraid to fail", she is quoted as saying. She rightly posits that the strength of a board isn't really known till times of crisis, which can take many shapes and forms. Waterous also recommends that boards get to know thier investors before a crisis happens. "Don't leave it to a crisis to get to know your investors", she urges. She also indicates CEO selection is the hardest decision and comes down to judgement. "A gap in leadership is sometimes a dangerous condition" Waterous says. In reading this, I thought of recent troubles at a certain UK Plc in which leadership gaps whrere clearly present, leading to financial mis-statements and an investigation.
Lastly, she warms against the great danger of groupthink and believes strongly in diversity of experience, expertise and perspectives. The full article can be viewed here: http://www.out-law.com/en/articles/2014/november/regulatory-tsunami-driving-fear-of-failure-culture-in-british-business-/.
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