According to the Daily Record, Dave King has been sacked from the board of Rangers Football Club PLC. Mr King took up a place on the board in 2000.
This has not yet been formally confirmed, either on the Rangers section of the PLUS SX newswire or on Rangers’ own website. Indeed Rangers website still does not list new director Andrew Ellis as a Director. However, Gordon Smith and Ali Russell, who are not Directors, are pictured.
By my reckoning, if it is correct regarding Mr King, then Rangers Football Club PLC has only two directors left: Craig Whyte and Mr Ellis.
Mr Ellis is a non-executive Director.
The Business Link website is helpful in determining what executive and non-executive Directors are meant to do.
“Types of directors
There are two types of director, executive and non-executive. There is no legal distinction made between executive and non-executive directors – the difference is that non-executive directors do not get involved in the day-to-day running of the business.
Executive directors perform operational and strategic business functions such as:
- managing people
- looking after assets
- hiring and firing
- entering into contracts
Non-executive directors use their experience and expertise to provide independent advice and objectivity, and they usually have a role in monitoring executive management. A non-executive director might be appointed to carry out a specialist role on a part-time basis or for their expertise in specific activities, such as strategy and contract negotiation.
They usually work part time, attending board meetings and spending time on specific projects.
Non-executive directors bring an objective view of the business, can improve the board’s effectiveness at relatively low cost and provide valuable business connections.”
In 2003 the Higgs Report was released. This document attempted to deal with various corporate problems by emphasising and strengthening the role of the non-exec as as independent protector of shareholders’ interests and as someone to exercise some restraint on the execs.
Derek Higgs made various recommendations for quoted companies (Rangers Football Club PLC is a quoted, though suspended, company.)
A Board of directors should be of appropriate size. At least half the directors should be non-execs. The non-execs should be independent.
The Chairman and Chief Executive should not be the same person.
A Senior Independent Director should be appointed to whom shareholders could come with concerns, rather than having to go to the execs.
The non-execs should meet at least once a year without the execs, and this should be recorded in the Annual Report.
At that time the average board of a listed company comprised 7. Three execs, three non execs and a Chairman.
As regards non-execs it was recommened that they satisfy themselves that financial information is accurate and that risk management processes are in place and robust.
Rangers however seem to have a new idea. The “non exec” Mr Ellis is either there to have a day to day role, in which case he is not an non-exec, and even if he is truly a non exec, he cannot be an independent one due to his close connections with Mr Whyte.
There is therefore no independent scrutiny of what Mr Whyte does, and as a result the 26,000 or so small shareholders for whom Mr Johnston and the IBC expressed concern at the time of the takeover have no one to represent their interests.
Mr Whyte has taken the unusual stance recently of meeting some of the fans’ organisations, including some with less than angelic reputations. He has eschewed the normal methods of releasing information regarding cash flow, profit information and details regarding accounts and AGM’s via press release, and through the proper channels.
Concerns have been raised that his method of releasing such “market sensitive” information could be in breach of the rules. This may explain his wish to de-list from PLUS SX once a year from the takeover has passed.
It may be that Mr Whyte has a raft of new directors, both exec and non-exec, to step in.
Perhaps Ali Russell and Gordon Smith will officially be elevated to the Board.
Till then it seems that Mr Whyte pays as much attention to the needs of good corporate governance as he does to filing deadlines and fixing statutory meetings!