The FT has run a story today that I picked up upon my return from NYC. "Tide of regulation scares off budding non-execs" raises the lid on growing impact of regulation on bank boardroom norms, with greater levels of supervisory oversight, higher degrees of personal accountability via the senior managers regime (SMR), applications of a myriad of new rules, and the spectre of the regulator creeping in boardroom decision making/shadow involvment.
In the article, a number of search firms indicate that NED recruitment may get harder in the future for qualified canadidates. The combination for higher technical standards required plus diminished appetite for the expanded role could have a double impact upon candidate interest to join bank boards. Essentially, some directors increasingly feel the level of engagement required in the new environment exceeds that of typical board level oversight and monitoring and begins to approach that of operating management levels, resulting in a governance shock and even confusion over final operational responsibility for risk management and financial control.
Others say privately that the higher degree of oversight is a misnomer and being a NED has always carried this level of responsibility and accountability.
Which side of this argument is right? This article echoes the concerns raised in Canadian boardrooms found the Financial Post discussed on a blog post on October 26th here on my site.
Others say privately that the higher degree of oversight is a misnomer and being a NED has always carried this level of responsibility and accountability.
Which side of this argument is right? This article echoes the concerns raised in Canadian boardrooms found the Financial Post discussed on a blog post on October 26th here on my site.
The article can be found at http://www.ft.com/cms/s/0/e6aa70bc-4f02-11e4-9c88-00144feab7de.html#axzz3KxXcvr00.
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