ShareSoc is submitting a response to the BIS Discussion Paper on “Transparency & Trust” which can be read here: www.sharesoc.org/Transparency_&_Trust_ShareSoc_Response.pdf . This wide ranging consultation is on a number of proposals to tackle many problems in the modern corporate scene, with a particular focus on tax avoidance and money laundering. Knowing who controls and owns companies is one of the concerns, but it also aims to tackle incompetent and fraudulent directors. A summary of the key points ShareSoc made in our response is as follows:
1. We believe the beneficial owners of all shares held in nominee accounts should be declared and recorded on share registers (there are already provisions available to record and process this information in the Crest system for public companies and it would be easy to record it for private companies on their share registers). This would have very wide benefits in improving shareholder democracy in all companies, as it would be clear who your fellow shareholders are. This is a much simpler system that that proposed in the Discussion Paper (effectively requiring this information to be submitted and held by Companies House).
2. We agree with the suggestions that “bearer” shares should no longer be permitted and that corporate directors should be prohibited. We see no need for these archaic usages.
3. We support the proposals to improve the rights of creditors and liquidators to pursue claims and widen the scope of disqualification proceedings after the failure of a company.
4. We also support the concept of improving the education of all directors, particularly those involved in corporate failures.
But please read the Discussion Paper and our detailed submission if you have an interest in these matters as there are some very complex issues involved.