Question

Cadbury committee on corporate governance

Answer 1

'Cadbury Committee' was set up in May 1991 with a view to overcome the huge problems of scams and failures occurring in the corporate sector worldwide in the late 1980s and the early 1990s. It was formed by the Financial Reporting Council, the London Stock of Exchange and the accountancy profession, with the main aim of addressing the financial aspects of Corporate Governance. Other objectives include:

(i) uplift the low level of confidence both in financial reporting and in the ability of auditors to provide the safeguards which the users of company's reports sought and expected;

(ii) review the structure, rights and roles of board of directors, shareholders and auditors by making them more effective and accountable;

(iii) address various aspects of accountancy profession and make appropriate recommendations, wherever necessary;

(iv) raise the standard of corporate governance; etc. Keeping this in view, the Committee published its final report on 1st December 1992