Accountant and consultancy Moore Stephens has said the need to comply with corporate governance requirements is still being underestimated or ignored by large sectors of the insurance industry in spite of the very visible interest being taken by the regulators.
Writing in the firm's Insured Interest newsletter, Moore Stephens partner Simon Gallagher said: “It has been argued that there are too many codes covering corporate governance. But this should not be seen as a barrier, rather a source of useful guidance to the development of a firm's very own code. Companies should be creating principles that fit their own corporate profile and at the same time satisfy the regulators.
“Appropriate internal and external challenges need to be put in place to ensure the efficient long-term and day-to-day running of the business.
"Internal challenges include ensuring that the board is made up of the right people, with the courage and experience to challenge one another and demand accountability at senior management level. External controls include the appointment of appropriately qualified non-executive directors, who might include senior managers from distinct area of the business.”
Gallagher concluded: “The insurance industry needs to think seriously about corporate governance, and about getting the right procedures and the right people in place. It needs to address internal policies and systems.
"There is room for much more creative thinking. If the issue is not addressed by the industry, it is the regulators who will be doing the thinking for those who have neglected this important area of their business.”
