Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

MPs call for private firm corporate governance code after BHS

The work and pensions committee is calling for corporate governance and reporting requirements for public companies to be extended to private companies following the collapse of BHS.

In response to the government’s consultation on corporate reform, the committee said private firms should be held to account and company directors should have a duty to fund pension trustees to prevent another company collapsing “in the manner of BHS”.

The committee said its three-month inquiry into the collapse of BHS found a “near-complete absence” of good corporate governance.

The work and pensions committee is recommending that private companies with more than 5,000 pension scheme members should be made to uphold the corporate governance code. Arcadia, John Lewis, River Island and Clarks would all fall into this bracket.

Frank Field, chair of the committee, said: “For a company with a big social and economic footprint like BHS it is simply not enough to be accountable to shareholders – particularly when one shareholder owns most of the stock. The sorry tale of its sale and collapse was a result of gross failures of corporate governance.

“We have already expressed our grave concerns about corporate governance in the Green empire [Arcadia boss and former BHS owner Sir Philip Green], and we know the Arcadia pension fund is also now in substantial deficit. It can’t be right that basic information like the schedule of employer contributions and the length of the recovery plan is not in the public domain. If it goes under then levy-payers and pensioners foot the bill.”

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.