British banks ‘should disclose £1m earners’

Sir David Walker, the former Morgan Stanley chairman tasked with reviewing the corporate governance of banks in the light of the recent crisis, has recommended that all British banks should be forced to publicly disclose the number of their employees who earn more than £1m per year.

In his final report for the Government, Sir David also said non-executive directors should be given greater powers to monitor banks' risk-taking and pay deals.

"The fundamental change needed is to make the boardroom a more challenging environment than it has often been in the past," Sir David wrote. "This requires non-executives able to devote sufficient time to the role in order to assess risk and ask tough questions about strategy."

Chancellor Alistair Darling said Sir David's proposals were "the blueprint for how banks must be run in the future". The £1m disclosure rule will now be included in the new Financial Services Bill - the bill which, if it is enacted, will give the FSA the power to overrule any bank pay deals it finds excessive.

Some of the other proposals Sir David had been mooting are not included in his final report, however. The idea that the FSA should question big shareholders who sell bank stakes in order to understand their motives was deemed too "intrusive" and has been dropped. ·