Vince Cable, the Secretary of State for Business, Innovation and Skills launched a new review of investor behaviour and equity markets at the ABI’s Biennial Conference on 22 June 2011. The review is being led by Professor John Kay, who will examine investment in UK equity markets and its impact on the long-term performance and governance of UK quoted companies. In the same speech the Secretary of State announced that he would be consulting in summer 2011 on changes to company reporting that will propose tougher provisions on disclosure of executive pay.

 The terms of the Kay Review are here

The Kay Review picks up similar themes to those in the Government’s consultation paper, titled “A long-term focus for corporate Britain”, published in 2010, on the perceived existence of short-termism and market failures in the UK equity markets. The Government will publish the next steps in that review in summer 2011.