When it comes to boardroom bad behaviour, investment managers certainly talk a good game.
The multi-trillion pound fund management industry should hold great sway over the shenanigans at major companies – and they like to mouth off about how they could hold firms accountable.
But there does seem to be a gap between their actions and their words – it is as if the corporate governance departments and the fund managers who hold the voting rights do not talk to each other. And I suspect that is because they do not.
They have got different interests. Corporate governance departments are all about building reputations – though often they seem to care more about their own than the companies they actually invest in. It is a back-slapping exercise to prove how worthy and wonderful they are.
More women on boards, more control over remuneration policies, more accountability in takeover battles and so on. These are commendable targets that all well-run companies should aim for – if I only thought investment houses were really prepared to act on it.
The problem is that the money men always win, and that is why frequently the corporate governance targets are quickly forgotten by the fund managers who want to make a profit for their investors. All of this came to my mind when the corporate watchdog, the Financial Reporting Council last week revealed its latest proposals for a corporate governance code.
Specifically this latest upheaval has been prompted over the scandals of the collapse of Carillion and the vast bonus payouts for directors of house builder Persimmon, which saw its chief executive dubbed Mr £131m.
It will make no difference.
I suppose the real question is whether investors really care.
I am not an ethical investing convert, but badly run companies are harmful to wealth accumulation, and that is the point of investing, after all. Controlling rogue boardrooms and bad chief executives is why companies have shareholders.
But it is hard for investors to be engaged in a process from which they are detached by the process of owning shares.
In investment funds we delegate that responsibility to the fund manager, but how do you know how they voted? You do not because they will not tell you and frequently the votes of major shareholders are undeclared.
And even if you hold a share directly through a platform you cannot properly have your say as the platform holds your voting rights. It is technically possible, but practically unlikely. Of course this is all assuming investors are astute enough to actually realise when a company holds its annual general meeting.
It all ends up being a mess. But the end result is that neither the fund managers nor the companies are accountable. This allows hedge funds and other short-term investors to have an even greater say over companies which, in the long run, is no good for the wider health of the UK plc.