Sir Stuart Etherington, chief executive of NCVO, has said credit ratings agencies should be not-for-profits by law, and has called for more charity sector leaders to sit on PLC boards.
Sir Stuart made the comments last night at an event called ‘Making Capitalism Responsible’ organised by think tank Oasis Charities Parliament, which had speeches on capitalism from Business Secretary Vince Cable, Sir Stuart and Richard Paton, a member of Occupy LSX.
In his speech, Sir Stuart said credit rating agencies were part of the problem with the financial system, and said by law they should be not-for-profits: “They downgrade the credit of countries forcing them to borrow at higher rates,” he said. “And these same agencies rate complex financial institutions while making money from them.”
“They are part of the problem, not the solution.”
He said a not-for-profit credit agency should be created to compete with current players.
Sir Stuart also called on government to revitalise a civil economy, with mutuals and co-operatives, addressing this specifically to the Liberal Democrat part of the coalition.
And he made a strong call for greater diversity on PLC boards, saying that too often there was no way in for some groups. “The make-up of many boards in the financial sector is not representative of anyone in this room,” he told the audience. “There are only two people from civil society on PLC boards - Jasmine Whitbread from Save the Children and Dame Mary Marsh from NSPCC.”
He continued that he was “sick” of companies saying that charity leaders would not understand the issues of a private company. “Many of our leaders do deal with complex and global issues which large companies also face,” he said.
At the event, Business Secretary Vince Cable agreed that it was vital that company boards became more diverse.
Acevo CEO Sir Stephen Bubb wrote to Vince Cable, Secretary of State for Business, Innovation and Skills, calling for more charity CEOs to be appointed to company boards near the start of the year.
NCVO is already acting on the issue. This week, it announced a series of seminars aiming to create links between talent in the voluntary sector and FTSE company boards.
