Apologies for just posting a splurge of text, but this section of Andy Haldane's evidence to the Tyrie commission caught my eye. John Thurso's question is good, and he gets extra points for a great mixed metaphor (barking up a blind alley indeed!):
Q620 John Thurso: You make exactly that point—I found it a fascinating lecture to read. I will move on to shareholders, if I may. If you look at both Walker and Kay, they saythat what we really need to do is get shareholders more engaged. You are making the point that they are actually a fraction of the stakeholder community. Are we actually barking up a bit of blind alley if we look to enfranchise shareholders and bring them into this, in that, first, banks stocks are now a commodity that is traded on a very short term; secondly, as you point out, they are a very small part of the overall picture; and thirdly, they do not have any real control? The more we look to shareholders, the less we are keeping our eye on the ball of what we really ought to be doing.
Andy Haldane: I think that the conclusions of John Kay’s review of short-termism, broadly defined, were well targeted in empowering the asset managers, who these days hold the power when it comes to managing shares in many companies, not just banking companies. I though that the John Kay proposals, having shareholders sit up and pay somewhat greater attention than they have hitherto, were very sensible to lean against the endless corporation problem. However, I think the point you raise is right: there are stakeholders beyond shareholders about whom we might think more imaginatively. Other company law and rules in other countries do take them seriously. Existing company law in the UK does have these “have regards”—this broader set of stakeholders—but it is not clear to me how much regard is paid to that broader set of stakeholders in the actual running of firms, not just banks.