Winds of change breathe new life into trust boards

Investment trusts

Legal changes in November 2003 that required boards to justify their choice of investment manager have resulted in better corporate governance and a greater emphasis on shareholder value

The independence of investment trust boards has been enhanced by the Association of Investment Trust Companies' code of Corporate Governance, while the changes to the listing rules and the conduct of business rules in 2003 has rejuvenated their role as the counter-weight to the investment manager. The board is made up of a number of non-executive directors and a chairman, all of whom are employed in a part-time capacity and balance their duties to shareholders with a full-time career or busy retirement. Their role is to run the investment trust company on behalf of the shareholders, to app...