NORWAY/UK - Norges Bank Investment Management (NBIM), responsible for managing the assets of the NOK2.5trn (€290bn) Government Pension Fund - Global, has supported recommendations from the Walker Review for increased accountability but officials say they want it to go further.

In a letter of feedback into the review of UK banking corporate governance, NBIM, which invests around £32bn (€34.88bn) in UK equities, claimed recommendations which have relevance to the wider market - such as annual elections for chairman - should be written into the existing Combined Code for listed UK companies.

Any improvements specific to banks should then be adopted by the Financial Supervisory Authority (FSA) and incorporated into its rule-making, investigatory and enforcement powers. 

NBIM added that it wants the recommendations to go further and favours the requirement of annual elections for all directors of the board.

Anne Kvam, global head of corporate governance at NBIM, said: "This would address accountability. We should have an opportunity to get rid of directors that are not participating or doing a good job. It should not be a safe haven for three years."

She believes this should be the case for all companies in all sectors, as there is a fear that going forward there may be different codes and rules for different sectors, such as banking.

In the letter, NBIM argued that moving immediately to annual elections would ensure proper accountability for each individual directors' actions, and claimed where this requirement already exists "we have not witnessed any sudden or unjustifiable wholesale removal of a board. Such fears are misplaced. Shareholders must be trusted to act in the best interests of the company".

Kvam added: "We should move past the whole thing about it not being personal. It is personal. If the directors are not performing then we need to get rid of them, and we have to face that."

The organisation's officials also agreed with recent statements by Lord Myners suggesting shareholders must take front-line responsibility for the companies they have invested in. "We are willing to step up and take that responsibility," said Kvam. (See earlier IPE article: Myners wants legal governance duty for managers)

However, on the issue of remuneration NBIM is cautious about the use of a "say on pay" policy, as it believes the responsibility for these decisions rests with the board, and  investors can always change the board if they do not act correctly.

"We're not going to support 'say on pay'. The board manages the administration and we manage the board. If we start micro-managing that is not good corporate governance," added Kvam.

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email