The concept of stewardship has been around for as long as people have been asserting ownership over more things than they can, literally, keep in view. People have a natural desire to instil accountability in those entrusted with managing other people’s assets and it’s from this instinct that corporate governance and audit were born. Developments in legislation and regulation, along with the ever increasing speed of decision-making required in the modern business world all test the existing stewardship model. On top of those pressures, the financial crisis has led to calls for an even more fundamental rethink of managed investment structures. Something has to give, hasn’t it?
The new auditor and audit committee reporting regime has been with us a year. Under pressure, will the existing stewardship model deliver the checks and balances investors really need?
Some ask how we can achieve more effective engagement between investors in and management of companies. But the question of who or what is an investor is a more pivotal question.
The traditional model of stewardship has taken a knock since the financial crisis. I believe too much pressure is put on companies and their non-executive directors to fix problems that should be more widely owned.
UK corporate governance was never intended to be one size fits all. I believe that businesses should identify what works for them and then be brave enough to choose explanation over tick-box compliance.
I believe that for boards to operate effectively they need diverse thinkers. A business that recognises the need for a range of thinking patterns, behaviours, problem-solving styles and strengths in leadership is actually aspiring to real inclusivity.
This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK.