Institutional investors 'should be more active'

Institutional investors need to be more active in their role, a review has stated.

Sir David Walker called for institutional investors to be ’less passive and prepared to engage earlier’ if they spot failings in the governance of their establishment.

The Walker Review of Corporate Governance has concluded that financial organisations need non-executives to have more power in terms of strategy and risk assessment.

Financial institutions, which could include private banks, are also advised to take steps to make institutional shareholders more active.

Sir David stated: ’Improved governance can play an important complementary role by instilling greater confidence in the way banks are being run by their boards and overseen by their owners.’

In related private banking news, the Treasury recently announced proposals to give greater protection to mortgage borrowers.

Among the plans is a proposal that would give the Financial Services Authority the power to regulate second-charge and buy-to-let mortgages.ADNFCR-2318-ID-19482019-ADNFCR