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| Version 1 | Version 2 |
|---|---|
| Vince Cable to call for corporate rethink at CBI forum | Vince Cable to call for corporate rethink at CBI forum |
| (about 6 hours later) | |
| Business Secretary Vince Cable is to call for a comprehensive rethink about how UK companies are run and how they should be bought and sold in future. | Business Secretary Vince Cable is to call for a comprehensive rethink about how UK companies are run and how they should be bought and sold in future. |
| He will ask the CBI conference how corporate governance should be reformed without discouraging investment. | He will ask the CBI conference how corporate governance should be reformed without discouraging investment. |
| Mr Cable will also question the process for the acquisition of other companies. | Mr Cable will also question the process for the acquisition of other companies. |
| Meanwhile, the CBI has warned that the UK will need to work hard to maintain its position against rising global competition for business investment. | Meanwhile, the CBI has warned that the UK will need to work hard to maintain its position against rising global competition for business investment. |
| Short-term goals | Short-term goals |
| Mr Cable told the BBC that a key strength of the UK economy has been its ability to attract foreign investment. "We have to build on that," he said. | |
| But he added that any investment must be for the long term. | |
| In a speech to the Liberal Democrats last month, Mr Cable spoke of the "murky world of corporate behaviour" which "takes no prisoners and kills competition where it can". | |
| The business secretary will now ask whether shareholders in one company should be consulted before their board buys another company - a reference to the fact that many Kraft shareholders did not want to buy Cadbury earlier this year. | The business secretary will now ask whether shareholders in one company should be consulted before their board buys another company - a reference to the fact that many Kraft shareholders did not want to buy Cadbury earlier this year. |
| Another of the 17 questions he will pose is whether British boards are too focused on short-term goals and whether shareholders should rein in company bosses more, especially when it comes to pay. | |
| Mr Cable will also tell the CBI that the best solutions are those which are owned and driven by market participants - especially investors and companies. | Mr Cable will also tell the CBI that the best solutions are those which are owned and driven by market participants - especially investors and companies. |
| 'Much to do' | 'Much to do' |
| Following a survey of 121 bosses of the biggest UK firms and large overseas companies operating in Britain, the CBI, which starts its annual conference in London on Monday, said the UK needed to cut regulation, and reduce both business and personal taxation. | |
| It added that the planning system and infrastructure also needed improving. | |
| The survey, which was co-produced by accountancy group Deloitte, said the UK scored highly for its economic stability. | The survey, which was co-produced by accountancy group Deloitte, said the UK scored highly for its economic stability. |
| However, respondents said the US, Canada, China and India were now seen as more attractive countries in which to invest. | |
| Richard Lambert, CBI director general, said: "Having acted fast to tackle the deficit, the government must now focus on how to attract more investment to the UK, if we are to create new jobs and grow the economy. | Richard Lambert, CBI director general, said: "Having acted fast to tackle the deficit, the government must now focus on how to attract more investment to the UK, if we are to create new jobs and grow the economy. |
| "The coalition's efforts to improve the general business climate are viewed favourably, but there is much to do to improve the UK's competitiveness as a destination for investment." | "The coalition's efforts to improve the general business climate are viewed favourably, but there is much to do to improve the UK's competitiveness as a destination for investment." |
| Mr Lambert told BBC Radio 4's Today programme that corporate taxation levels needed to be more competitive, while skills and transport issues needed to be addressed. | |
| "We have world class skills at the higher level but we do poorly on basic and intermediate skills, and we need to address our transport infrastructure which lags behind the rest of western Europe." | |
| The CBI said that while the UK still performed favourably, it had "lost ground over the past 10 years". | The CBI said that while the UK still performed favourably, it had "lost ground over the past 10 years". |
| It added that while the UK still performed strongly in areas such as good labour relations and flexible working practices, these issues were now seen as less important for firms making investment decisions. | It added that while the UK still performed strongly in areas such as good labour relations and flexible working practices, these issues were now seen as less important for firms making investment decisions. |
| Regarding sectors of the economy, the CBI said manufacturing companies were the least likely to invest in the UK, while financial firms and others in the service sector were more likely to view the UK in a favourable light. | |
| However, Mr Lambert said he was confident that the private sector in the UK would be able to soak up public sector job losses caused by the spending cuts, estimated to be up to 500,000 jobs. | |
| "Over the last 10 years, the private sector has, on average, created well over 200,000 jobs a year," he said. | |
| 'Great challenges' | 'Great challenges' |
| John Connolly, chief executive and senior partner of Deloitte, said: "If the UK economy is to continue its recovery, then growth and jobs will have to come from the private sector. | John Connolly, chief executive and senior partner of Deloitte, said: "If the UK economy is to continue its recovery, then growth and jobs will have to come from the private sector. |
| "One of the great challenges for policymakers is to provide the right conditions for companies to grow." | "One of the great challenges for policymakers is to provide the right conditions for companies to grow." |
| Mr Cable said he welcomed the fact the majority of bosses surveyed by the CBI said they expected the coalition government to improve the climate for businesses. | Mr Cable said he welcomed the fact the majority of bosses surveyed by the CBI said they expected the coalition government to improve the climate for businesses. |
| He said: "We want to provide an environment where businesses are confident to invest in the UK and today the prime minister and I will be talking to the CBI and setting out the government's strategy for growth. | He said: "We want to provide an environment where businesses are confident to invest in the UK and today the prime minister and I will be talking to the CBI and setting out the government's strategy for growth. |
| "We believe that to do this you have to get the fundamentals right so we will be looking across the whole range of economic policy - from tax to regulation, skills to science, infrastructure to competition policy, bank lending to trade - to make it easier for businesses to flourish." | "We believe that to do this you have to get the fundamentals right so we will be looking across the whole range of economic policy - from tax to regulation, skills to science, infrastructure to competition policy, bank lending to trade - to make it easier for businesses to flourish." |