) The Greenbury Committee 8

This committee was setup in January 1995 to identify good practices by the
Confederation of British Industry (CBI), in determining directors’
remuneration and to prepare
a code of such practices

for use by public limited

companies of United Kingdom.
The committee aimed to provide an answer to the general concerns about the
accountability by the proper a

llocation of responsibility for determining

directors’ remuneration, the proper reporting to shareholders and greater
transparency in the process.
The committee produced the Gr

eenbury Code of Best Practice which was

divided into the four sections : Remmuneration Committee, Disclosures,
Remuneration Policy and Service Contracts

and Compensation.
The Greenbury committee recommended that UK companies should
implement the code as set out to the fullest extent practicable, that they should
make annual compliance statements, and that investor institutions should use
their power to ensure that the best practice is followed.