Select committee: Public Administration and Constitutional Affairs Committee
Recommendation 8
Seventh Report - The Role of Non-Executive Directors in Government
Published 20 Jun 2023
Paragraph 39
Public Administration and Constitutional Affairs Committee The Role of Non-Executive Directors in Government All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
The Committee recommends that the Corporate Governance Code is updated to reinstate the “independence” of non-executive board members, which was removed from the 2011 and 2017 editions of the Code. The updated Code should outline the expectation that Secretaries of State should avoid appointing individuals with clear political or personal connections, including former or current Special Advisers, serving Members of Parliament or Peers, to NED roles. In the event that any are appointed, there should be a clear justification for doing so in the governance statements of departments’ annual report and accounts.
From: Public Administration and Constitutional Affairs Committee, Seventh Report - The Role of Non-Executive Directors in Government (HC 318), paragraph 39, 20 June 2023
Government response
The government responded to the whole report on 8 September 2023 (deadline 1 September 2023).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government's response to the Committee's report is mixed: it agrees with some recommendations on transparency and appointments, and does not agree with others, including updating or replacing the Code by the end of the calendar year.
- On the Corporate Governance Code, the government "respectfully does not agree" that it should be updated or replaced by the end of the year; it "will consider" whether the Code "would benefit from some updates", wishing departments to "retain flexibility".
- It agrees that roles and responsibilities of non-executive board members and terms of reference should be published on departmental websites, and that departures from the Code should be reported in annual reports and accounts.
- On appointments, it says non-executive board member appointments are now regulated by the Commissioner for Public Appointments, a commitment it describes as "now been met". It does not agree that Peers should be restricted, and says an exclusion for former Special Advisers "would not align" with the Governance Code for Public Appointments.
- It does not agree that the Government Lead Non-Executive should act as a "quasi-regulator", and does not support routine publication of board minutes. It will "consider" the findings of the Governance and Accountability Review "in due course" once published.