Chairmen do protest too much.

(From Financial Director)

Byline: Robert Bruce, a leading commentator on accountancy issues.

We can learn from the summer we have been enjoying this year. Areas of high pressure suck in wind and bluster, and the same, it seems, applies to the Higgs Report on non-executive directors. Now that the report has been finalised, we can look back and wonder in amazement at some of the daft things that were said.

The Combined Code now exists in its final form and we can move on. The whole ethos of 'comply or explain' will settle down. But it is important to look back at the sort of turbulence we had over the first six months of the year and analyse what brought it about, because it was the sort of episode that discredits the business world.

To outsiders, much of what was being suggested would, had they read it, have seemed like common sense. But the spectacle they would have viewed would not. Every successive wave of corporate governance reform comes with two predictable consequences. First the majority of companies in the FTSE-100 will announce they welcome the reforms because they are, in effect, a codification of best practice and so each particular company commenting is already high up there on the best practice charts. The second thing that happens is that a number of chairmen - the most pompous and self-important ones - announce that the new reforms are an absolute disaster, that they will lead people to concentrate on these nonsensical reforms rather than remaining focused on the business and that an outbreak of box-ticking will ensue.

The latter is one of those self-fulfilling prophecies. If this is really what they think, then they are bound to bluster about it so much that a significant number of people in the organisation will fulfil their wishes and reduce the reforms to useless bureaucracy. It doesn't do to fall out with this type of chairman. If he expects useless bureaucracy to be the result, then that's what he will get.

All this is just knee-jerk reaction, honed to perfection over the years since Sir Adrian Cadbury first embarked on the reforms that followed the great corporate scandals involving Robert Maxwell, Polly Peck and a host of companies and people which, if they still existed, would be providing the sort of nonsense we heard post-Higgs.