Co-op Reforms 'A Welcome Break from the Failings of the Past' - Says IoD
(Targeted News Service Via Acquire Media NewsEdge) LONDON, Aug. 8 -- The Institute of Directors issued the following news release:
Commenting on the Co-op's proposed reforms to its governance structure, Oliver Parry, Corporate Governance Adviser at the Institute of Directors, said:
"In broad terms, the proposals announced today by the Co-op are a step in the right direction and a welcome break from the failings of the past. They appear to have listened to members' views that overhaul of the Board was needed. Nonetheless, the overall governance structure at the Co-op remains somewhat confusing. Indeed, the Co-op group needs to adapt its governance model to the realities of the modern global economy, just as private sector boards have needed to become more professional over the last decade.
"We welcome the creation of a more independently minded board, which will hopefully give the Co-op the necessary expertise and experience to oversee a business of this size and complexity. It is also pleasing to see the board cut from 18 to 9 members.
"However, we remain concerned that of the 9 members of the Board, 3 will still be elected by other members. Without an entirely independently appointed board, there remain concerns about how much independent oversight the board will be able to exercise. This was an opportunity for a decisive change of direction for the Co-op and whilst significant progress has been made, we would like them to have gone further in addressing their governance problems.
"An entirely professional board of directors, appointed on the basis of objective criteria and skill requirements, would have offered the Co-op the best chance of sustaining its distinctive mutual values and traditions. This is only the first step on the ladder to the group reforming itself and we would urge members of the Co-op to look closely at the proposals laid out today and to consider carefully whether enough has been done to reassure them that the governance arrangements will provide the stability this organisation needs."
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