Good corporate governance and effective investor stewardship are cornerstones of sustainable corporate success. Institutional investors also have a fiduciary duty to appropriately represent the interests of their investor base (many of whom are small investors) through active engagement with their portfolio companies.

The legal duty of directors is too permissive and needs to be tightened up for the benefit of all concerned. A sensible balance needs to be struck in order to allow directors to make good business judgements in the normal course, on the one hand, and to enable directors who have failed in their legal duty to be sued, on the other.

Standard Life Investments called for Murdoch to step down as Chairman of BSkyB and voted against his re-election as a director. Guy Jubb said, ‘We explained to [Nicholas] Ferguson that the unsuccessful bid approach from News Corporation had magnified the conflicts of interest which the independent non-executive directors have to deal with and, therefore, that it is inappropriate that the group’s board (or indeed the board of any company) is led by a representative of its largest shareholder and putative offeror.’

Guy Jubb was Deputy Chair of the ICAS Working Group which developed proposals contained in its thought leadership report about the role of assurance to inspire trust in corporate reporting. It addresses issues such as the responsibilities of boards and their audit committees, the role of corporate reporting and engagement with shareholders.

One of Guy Jubb’s key recommendations is that shareholders in general, and institutional shareholders, in particular, should be more assertive in the way they challenge boards regarding the decisions they make, and their corporate governance.