And credit rating agencies should be not-for-profit organisations, argues Stephen Lloyd of Bates Wells & Braithwaite
Not-for-profit organisations should run credit rating agencies and audit quoted companies, a charity lawyer has said.
During a lecture on Capitalism in Crisis at Cass Business School last night, Stephen Lloyd, a senior partner at law firm Bates Wells & Braithwaite, said the private sector should be learning lessons from charities in the wake of the financial crisis.
"In the past 20 years, charities have been urged to act more like businesses," he said. "The time has come for businesses to act more like charities."
Lloyd argued that the statutory auditing of quoted companies should be carried out by community interest companies, which would be regulated by a new public companies audit office and financed by a statutory levy.
He also said that credit rating agencies, which are able to profit from giving high ratings to risky financial products, should also be transformed into not-for-profit organisations controlled by key stakeholders.