Risk managers challenge Combined Code review

Changes to the UK’s Combined Code that were published last June in response to the financial crisis are a “missed opportunity” and only represent a “minor improvement” in governance systems.

These are the findings that emerged from a workshop held by Heath Lambert at the last Airmic conference. More results are displayed in the images on the right. And the full report is available as an attachment.

Delegates also felt that a combination of prescriptive and principles based regulations were the best solution for the future. Over 90% of the respondents thought a combined approach was workable.

In June 2010 the Financial Reporting Council issued a review of the UK Corporate Governance Code. The workshop considered the main revisions to the code and delegates were asked to give their opinion on whether or not these are focused on the right areas.

Organisations should “think long and hard about the current effectiveness of governance standards in the UK and what is necessary to deliver the right combination of confidence and success,” said Nicola Harvey, chairman of Airmic and risk manager for auction house Christie’s.

Commenting on the results of the research Anthony Hilton, financial editor of the Evening Standard, said: “There is huge scepticism about the current system, the principles which drive it and whether it will live up to the expectations of its supporters. If ever there was a clarion call for an industry to think seriously about where it is heading, this is it.”