The BEIS corporate governance inquiry report was published this week. I haven't yet had a chance to read it in detail but Alex Edmans, who gave both oral and written evidence has usefully summarised it here. He makes the very important point that evidence should be viewed with care and not cherry-picked, an issue that has plagued the debate on board gender diversity since Lord Davies' first report, which relied on a very selective review of the existing literature.
But taking a balanced view of available evidence also requires some thought about gaps. Conan Doyle and more recently Mark Haddon each constructed a plot on such a gap, the dog that didn't bark. While assisting ICAEW in providing a summary of the written consultation evidence to the committee, I noticed a significant absence of any comment from companies. Some reflection on this could be instructive. If corporate governance reform is to be effective, consensus has to be achieved not just among company stakeholders but with companies themselves: the process of building the Cadbury Code clearly demonstrated that. Stronger enforcement may not be the answer.
A fundamental review which addresses more directly the purpose of the corporate form is sorely needed. My letter on this appeared in the FT last Saturday.
