Category Archives: Corporate Governance

Recruiter places ‘phoenix’ firm into liquidation just months after repurchase erased millions in debt

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New company reportedly quickly fell behind with promised repayments to administrator

A recruitment executive who was allowed to buy back the assets of his bust company in instalments, despite it accumulating almost £3m of debt, has placed his new business into liquidation after falling behind with promised payments to the administrator.

The news is the latest event to raise questions about the practice of “phoenixism”, accounting’s controversial art of liquidating companies to allow directors to return with a new entity, free of debts.

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UK asks banks for feelgood stories about keeping out dirty money

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City firms tapped for case studies to try to convince global watchdog that London has cleaned up its act

The government is asking bankers and lawyers to provide feelgood stories about how they blocked dirty money from entering the UK, as ministers try to prove the UK’s money-laundering controls are working.

The Treasury’s call for evidence is meant to illustrate that the UK has upped its game when it comes to preventing financial crime, particularly since its last dismal assessment by the Financial Action Task Force (FATF) global crime watchdog in 2018, which fuelled allegations that London had become a hub for “dirty money”.

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Ex-Barclays boss denies having sex with a woman dressed as Snow White

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Jes Staley made the comments to US lawmakers investigating his links to Jeffrey Epstein

The former Barclays boss Jes Staley has denied having sex with a woman dressed as Snow White, after being questioned about an infamous email exchange about Disney princesses with Jeffrey Epstein.

The comments were detailed in newly released transcripts from a closed-door interview last month with US lawmakers as part of their investigation into Epstein, who died in prison in August 2019 while awaiting trial on child sex-trafficking charges.

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Pay gap widens as UK bosses get 130 times average worker’s salary

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In its final report the High Pay Centre says the median remuneration of a FTSE 100 CEO has risen to a record £5.06m

The bosses of Britain’s largest listed companies received record pay last year, fuelling the widest earnings gap with workers in eight years.

Median pay for FTSE 100 chief executives hit £5.06m in the last financial year, according to data released by the High Pay Centre, an 8.6% increase on £4.66m the previous year and the highest level on record.

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Thames Water creditors seek talks with Burnham as nationalisation looms

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Consortium preparing for potential legal battle amid reports new PM could put the company into temporary public ownership

The group of investors pursuing a rescue bid for Thames Water have said they are willing to discuss greater public control but are also preparing for a potential multi-billion pound legal battle amid reports that Andy Burnham could temporarily nationalise the company.

London & Valley Water (L&VW), a consortium of 100 institutional investors that hold £17bn of the company’s £21bn debt, has said it is open to government involvement with Thames Water, but indicated that this does not include public ownership in the struggling company.

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Australian medical college leader suspended from position over alleged health and safety breach

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Dr Sharmila Chandran suspended until 20 September as Royal Australasian College of Physicians agrees to work with regulator to meet its obligations

The charities regulator has suspended the president-elect of one of Australia’s oldest medical colleges for allegedly contravening a direction from the NSW work health and safety watchdog.

The Australian Charities and Not-for-profits Commission (ACNC) on Monday issued a notice suspending Dr Sharmila Chandran as a responsible person of the Royal Australasian College of Physicians, which is a registered charity, until 20 September.

SafeWork NSW advised that Chandran’s alleged failure to comply with a directive not to contact RACP staff was exposing them to “immediate and serious risks” to their psychological health and safety, the ACNC said in a public statement.

The intervention follows months of conflict within the RACP’s board, which culminated in an extraordinary general meeting last month to which police were called.

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HSBC ‘reviewing’ private school perk for bankers in Hong Kong

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Hundreds of senior staff in territory benefit from nearly £30,000-a-year grant per child not available to staff in group’s other hubs

HSBC is reportedly reviewing a perk that covers school fees for bankers in Hong Kong as part of a big overhaul of the bank under its chief executive, Georges Elhedery.

Europe’s largest bank is considering whether to scrap the perk for new employees or make changes to total compensation, Bloomberg News reported. No decisions have been made yet.

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Nationwide could have first customer on board for nearly 25 years

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James Sherwin-Smith will be up for election after securing more than 250 nominations to run alongside existing directors

Nationwide building society could have a customer on its board for the first time in nearly a quarter of a century after one of its longtime members secured enough support for a spot on the lender’s annual ballot.

James Sherwin-Smith will be up for board elections at Nationwide’s annual general meeting (AGM) in July, having gathered more than the 250 peer nominations necessary to run alongside existing directors.

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Ban corporate donations to UK political parties to protect elections, says thinktank

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CenTax warns bill under debate in parliament has ‘easily exploitable’ loopholes and will not prevent foreign interference

Political donations by companies should be banned to protect UK elections from foreign interference, a thinktank has warned.

In the first big overhaul of election funding in 26 years, ministers have pledged to “keep British democracy safe” by closing a loophole that allows individuals not eligible to vote in Britain to donate to political parties through UK-registered companies.

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John Lewis pays first annual staff bonus in four years as profits rise

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Payment of 2% at employee-owned partnership follows sales increase to £13.4bn

The owner of John Lewis and Waitrose has paid an annual bonus to workers for the first time in four years after underlying profits rose by 6%.

The retail group’s 69,000 employees – which it calls partners – will share £35m, the equivalent of 2% of salary, after it recorded an increase in sales and profits. The payout amounts to about one extra week of pay.

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Billionaire Zara founder Amancio Ortega to receive €3.23bn dividend

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Payment for Inditex founder, the world’s 15 richest person, tops last year’s dividend of €3.1bn

The billionaire founder of Zara is to receive a company record €3.23bn (£2.8bn) dividend this year from the world’s biggest fashion retailer.

Amancio Ortega, who still controls 59% of Spain’s Inditex and whose daughter Marta Ortega Pérez is now chair, will receive half his dividend in May and half in November – as will other shareholders.

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UK recruiter emerges from insolvency for third time, avoiding millions owed in tax

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Hampshire business seems to have benefited from ‘phoenixism’, which costs the taxpayer about £800m a year

A UK recruitment business has been acquired out of administration for a third time in four years as part of a succession of deals that left some of the former management team in place and millions of pounds owed to the public purse.

The chain of insolvencies appears to contain more examples of phoenixism – a process when companies are liquidated and directors are able to rise from the ashes with a new entity, free of debts.

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UK accused of caving-in to British Virgin Islands over access to companies register

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Parliamentary group urges government to clamp down on overseas territories before flagship anti-corruption summit

The UK government has been accused of caving-in to pressure from the British Virgin Islands by allowing it to limit access to a register of company share ownership to only those deemed to have a legitimate interest.

The restriction, to be discussed at talks starting on Tuesday between Foreign Office ministers and leaders of the British overseas territories (BOTs) in London, is in defiance of legislation passed by the UK government as long ago as 2008 that would make the register available to all.

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Last Christmas, you gave us first class: Royal Mail turns Scrooge with gift to staff of second-class stamps

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Switch comes amid first festive season since Daniel Křetínský’s takeover of parent company IDS

Royal Mail says that it has “delivered Christmas” for more than 500 years, but this year many workers have been left feeling less than festive after the company downgraded a small gift to workers to second class.

The postal service, which traces its history back to the appointment of a “master of the posts” by Henry VIII in 1516, has given workers a collection of 50 Christmas stamps to recognise their work over the busiest time of year. In previous years, including in 2024, workers have received a book of 50 or 100 first-class stamps, but that has quietly been switched to second class this year.

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Australia could be a ‘dumping ground’ for goods made for us with forced labour, anti-slavery tsar warns

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Exclusive: Chris Evans says ‘blind spots’ in modern slavery laws means few prosecutions occur and some companies are ‘taking the mickey’ in their approach to reporting

Australia’s modern slavery laws are among the weakest in the developed world and the country risks becoming a “dumping ground” for goods made with forced labour, Australia’s first anti-slavery commissioner has said.

In a wide-ranging interview with Guardian Australia, the commissioner, Chris Evans – a former Labor senator and minister – said there were “blind spots” in Australia’s efforts that risked the country becoming a global laggard.

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Companies face prosecution risk as new fraud law comes into force

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CPS hails ‘major step forward’ in crime prevention with potential for companies to receive unlimited fines

Companies could be prosecuted and face unlimited fines if they fail to prevent fraud that their firm profits from under a corporate offence coming into force on Monday.

Under the new “failure to prevent fraud” law, large companies can be held criminally liable where an “employee, agent, subsidiary or other ‘associated person’” commits a fraud intending to benefit the organisation.

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Loan ‘irregularities’ led to collapse of Prax Lindsey oil refinery

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Administrator was appointed after parent company State Oil was given new information about £783m loan

The Prax Lindsey oil refinery collapsed after “material irregularities” were discovered in a complex £783m loan facility that funded the wider group, it has emerged.

The refinery on the Humber estuary in northern England – one of just five left in the UK, – was suddenly plunged into administration in late June, prompting calls from furious government ministers for an investigation into Winston Soosaipillai, Prax Group’s oil tycoon owner.

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Anger as Nationwide refuses members a binding vote on boss’s 43% pay hike

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Lender says Debbie Crosbie’s package ‘should compete with banks’ but critics say building societies are ‘supposed to be the good guys’

Nationwide is under fire for refusing to give members a binding vote on a controversial 43% pay rise for its chief executive, Debbie Crosbie, which could total up to £7m.

Campaigners say it leaves the mutual’s members with fewer rights than shareholders of listed UK banks and exposes a worrying “loophole” in building society rules.

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Taxpayers set for £10bn loss on NatWest as disgraced ex-boss takes £600k-a-year pension

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Government expected to sell last shares in banking group this week, drawing a line under 2008 financial crisis bailout

Fred “the Shred” Goodwin, the disgraced ex-boss of Royal Bank of Scotland, is estimated to be receiving an annual pension worth nearly £600,000, as the government prepares to declare a £10bn loss after selling its final stake in the bank as early as this week.

The banking group, now known as NatWest, is expected to return to full private ownership within days, drawing a line under a £45bn state bailout that saved the bank from the brink of collapse at the height of the 2008 financial crisis.

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Thames Water chair could face questions after comments to MPs on bonuses

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Exclusive: Sir Adrian Montague told select committee paying bonuses out of emergency £3bn loan was insisted upon by creditors

The chair of Thames Water could face more questions over his statement to parliament that large bonuses to be paid to senior bosses out of an emergency £3bn loan were insisted upon by creditors.

Sir Adrian Montague told the environment, food and rural affairs (Efra) select committee last week that the lenders had insisted that “very substantial” bonuses of up to 50% of salary should be paid to company executives from the controversial loan in order to retain key staff.

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