Don’t rely on Compliance

Box-ticking executive

The UK has recently suffered the collapse and liquidation of its second biggest construction company and one of its biggest providers of construction and services to the state through the Private Finance Initiative (PFI). Up till this point, Carillion, the UK’s second biggest construction company, passed all the formal tests: unqualified audit reports from KPMG, compliance with the Corporate Governance Code and cooperation with the Stewardship Code. However, analysts have been predicting problems for some time, having analysed its accounts and spoken to its suppliers and customers, and its shares were shorted by hedge funds for several years before its demise.

So what price compliance? This disaster prompted us to look back at the corporate scandals which have led to regulatory responses and to consider, yet again, why these successive regulations have consistently failed to prevent subsequent scandals.


What is ESG? Can it really unlock Brand Value?

ESG is now mainstream and holistic Corporate Governance now drives brand value. But exactly what is ESG? We look at its origins in Responsible Investing and the principles thereof, various interpretations of ESG and its evolution towards complete acceptance by the investment community of the effect of holistic corporate governance on sustainability (in the widest sense) and hence brand value.


Corporate Governance and Islamic Principles

As the western world has been working to improve corporate governance in the years since the Cadbury Report of 1992, the Muslim world has been addressing the issue of how to reconcile the principles developed in the various codes with Islamic principles. We look at how these principles might be incorporated into western Codes and our Golden Rules.


Innovation: Corporate Governance’s hidden but vital contribution

innovation: corporate governance's hidden but vital contribution

Good corporate governance must encourage innovation to drive productivity, which creates high profits, well-paid employment and social benefits


Risk Management and Corporate Governance: Topical or Typical?


Risk Management is the latest topic to get our Golden Rules treatment, this time with a convenient Infographic. We look at the different types of risk and how our cardinal principles of good corporate governance can guide identification and management of these risks.


Shareholder Value and Corporate Governance

shareholder-valueHas Alfred Rappaport been unfairly judged?

A recent article by Professor Alfred Rappaport in the Financial Times defended his very influential and widely followed philosophy of the primary importance of the pursuit of shareholder value. This has come under increasing criticism in recent years, as the concept of a more balanced stakeholder approach has gained wider acceptance, and particularly as capitalism itself has come under fire since the 2008 financial collapse. So we thought it would be interesting to go back to the source of the controversy and review Prof. Rappaport’s defining book, Creating Shareholder Value, thirty years after its publication, in the light of current views about corporate governance, and see whether we agreed with Prof. Rappaport’s self-justification.