Government fails short-term test

Short-termism in corporate Britain can only be solved by company boards, and not by politicians, says the Institute of Directors.

Responding to a Government enquiry into short-termism, launched by Business Secretary Vince Cable, the IoD says governments, with their own short-termist tendencies, are not well placed to criticise companies for not always following a long-term strategy.

The IoD says it would be better if the Department for Business, Innovation and Skills (BIS) focused totally on supporting businesses and helping them create new jobs, rather than carrying out "yet another corporate governance enquiry."

IoD director-general Miles Templeman, said: "The main underlying causes of short-termism in corporate Britain cannot be overcome with new Government policies or regulations.

"Some short-termism is an inherent part of a stockmarket listing. Company boards need to become more active in ensuring that companies adopt a time horizon that maximises corporate value creation.

"With seven Business Secretaries in less than 10 years, politicians and governments are not particularly well placed to lecture corporate management teams on the need for continuity and a long-term strategy. Instead of yet another enquiry into corporate governance, the Business Department would be more effective if it focused all of its time on supporting businesses and helping them create new jobs."

Got a view? Leave a comment below.

CLICK HERE FOR The Star subscription offer. Use offer code STAOP0001 to get 25% off.

Follow The Star on Twitter and Facebook:

For breaking news and sport follow The Star on Twitter at www.twitter.com/sheffieldstar and Facebook at www.facebook.com/sheffieldstar.

JOIN THE STAR READER PANEL: The Star is YOUR newspaper, so tell us what you think about it and what you want to see - CLICK HERE.

Don't miss our daily pull-outs - only in the The Star: Monday Star Sport, Tuesday Class Act; Wednesday Business; Thursday Grassroots; Friday Time Out; Saturday Retro. Subscribe to The Star - CLICK HERE

READ MORE

Join the Star reader panel

Main news index

Your letters

Features

South Yorkshire's environmental news

Kids Zone

More business news

More Rotherham news

More Doncaster news

More Barnsley news

Latest sport