For immediate release: Thursday 3 November 2005

IMA CONCERN OVER REQUIREMENTS ON TRANSPARENCY IN VOTING

Responding to the Company Law Reform Bill published today, Richard Saunders, Chief Executive of the IMA, commented,

“ IMA supports transparency of voting by institutional investors and disclosure to clients on how their shares are voted, but we have serious concerns over the introduction of reserve powers to make it mandatory for institutional investors to disclose publicly how their shares have been voted.  This requirement will increase costs and compliance burdens with no benefits in terms of improved corporate governance. The Government has, moreover, seriously underestimated how much such a regime will cost.”

IMA also welcomes clarification that accounts will have to be prepared so that they show a true and fair view and that auditors will have to form an opinion on that basis.

-Ends-

Notes to Editors

1.  A copy of the Bill can be found here.
2.  Clause 866 covers the exercise of voting rights by institutional investors
3.  Clauses 366 and 482 cover the requirement for accounts to give a true and fair view and for auditors to give an opinion thereon.

For further information please contact:
Mona Patel, Head of Communications, IMA, 020 7831 0898

Out of hours contact:
Mona Patel, Head of Communications, IMA, 07834 089332