---

Dept of Trade and Industry

Answer

Mr. Gardiner: To ask the Chancellor of the Exchequer if he will make a statement on the timetable for implementation of the recommendations laid out in the Higgs report on non-executive directors. [94630] Ms Hewitt: I have been asked to reply. Most of the recommendations in Derek Higgs' report are for changes to the Combined Code. Derek Higgs expressed the hope that the changes would be introduced as soon as practically possible, preferably for reporting years starting on or after 1 July 2003. The Financial Reporting Council has invited comments by 14 April on the detailed drafting with a view to putting a revised code into effect on 1 July 2003 as suggested by Derek Higgs. The Government welcome this. It will then be for listed companies to comply with the new provisions or explain to shareholders why they have not done so. A group of business leaders and others is being formed under the leadership of Professor Laura Tyson, Dean of the London Business School, to consider how to bring to greater prominence candidates who could make an effective contribution to boards of listed companies. The group will report to me in May. The City of London Law Society and Institute of Chartered Secretaries and Administrators, together with the Association of British Insurers and the British Insurance Brokers' Association, will be developing guidance on directors' and officers' insurance. We will give careful consideration to Derek Higgs' recommendation as regards indemnifying directors in advance against costs of defending proceedings from the company itself, in the context of our wider reform of company law. The Lord Chancellor's Department is promoting active case management, as suggested in the report. We will ensure that the recommendation on considering the checklist in relation to new criminal sanctions on directors is drawn to the attention of those who may consider such legislation. Other recommendations are directed at individuals or boards or institutional investors. It will be for them to take forward the useful suggestions made.

Secondary information

Type

Written question

Reference

94630; 399 c482W;399 c480W

Session

2002-03

Subjects

Codes of practice Accountability Company law Companies Directors Insurance Public appointments Management Standards Financial Reporting Council Role and Effectiveness of Non-Executive Directors Review

Link

View this Written question on www.publications.parliament.uk