HC Deb 26 February 1980 vol 979 cc1177-8

'In any company with a paid up capital of £100,000 or more the shareholders shall at the Annual General Meeting appoint a Special Audit Committee on the following terms:—

  1. (a) all members of the Board of the Company shall be completely and expressly excluded from membership of the Special Audit Committee, and no relative of any Director nor any person holding shares in the Company shall be a member of the Committee;
  2. (b) the Committee shall consist of not less than three nor more than six persons and shall be authorised to employ professional staff to carry out its duties;
  3. (c) funds for the work of the Committee shall be voted by the shareholders at the Annual General Meeting;
  4. (d) the Committee and its staff shall have an unqualified right at any reasonable hour and without notice to examine the books, records, documents, vouchers, ledgers, contracts or any papers whatsoever relating to the business of the Company or the remuneration of any Director or employee of the Company;
  5. (e) the Committee shall report at least annually to the shareholders and may report at any time on any matter which in their judgment should be brought to the attention of the shareholders, and may also if they think fit make reports to the Department of Trade.
This section shall not be construed as overriding the normal statutory duties of the Company's duly appointed auditors.'—[Mr. Hooley.]

Brought up, and read the First time.

Mr. Frank Hooley (Sheffield, Heeley)

I beg to move, That the clause be read a Second time.

Mr. Deputy Speaker

With this we may take the following:

New clause 29—Audit Committees:

'(1) The agenda of every annual general meeting of a major public company shall include either—

  1. (a) the report of the audit committee of the board to the members, or
  2. (b) consideration of the appointment of an audit committee of the board.

(2) The report of the audit committee of the board to the members of any company shall state in what ways if any the practice of the company or of the audit committee has differed from the practice required to conform with the provisions of Schedule () to this Act (Constitution and Functions of Audit Committees).

(3) In this section a major public company shall mean any company registered in Great stock exchange if at any time within a period of five sears ending on the last day of its last Britain whose shares are listed on a recognised accounting reference period being a day not more than 12 months after the passing of this Act, the company has—

  1. (a) employed a number of employees in excess of 25,000; or
  2. (b) had total net assets in excess of £200 million.'.

New clause 30—Appointment of Non-Executive Directors:

'(1) Every company to which this section of this Act applies shall either—

  1. (a) have in addition to any other directors not less than three directors who shall be non-executive directors of the company, or
  2. (b) shall include in the agenda of the annual general meeting the consideration of the appointment of non-executive directors of the company.

(2) This section of this Act shall apply to any company registered in Great Britain whose shares are listed on a recognised stock exchange.

(3) The remuneration to be paid to the non-executive directors shall be decided by the members at each annual general meeting of the company and shall be at the discretion of the members, notwithstanding any provisions in the articles of the company governing the remuneration of directors.

Amendment No. 383, which proposes to insert a new schedule—