Pre-appointment hearing with the Government’s preferred candidate for Chair of the Financial Reporting Council Contents

Appointment of the Chair of the Financial Reporting Council

1.On 10 July 2019, the Department for Business, Energy and Industrial Strategy (BEIS) announced the nomination of Simon Dingemans as the Government’s preferred candidate for the role of Chair of the Financial Reporting Council (FRC). The Secretary of State invited this Committee to hold a pre-appointment hearing and to report on Mr Dingemans’ suitability for the post.

2.Select committee pre-appointment hearings scrutinise the quality of ministerial decision-making, which is a proper part of ministerial accountability to Parliament; they provide public reassurance that those appointed to key public offices have been selected on merit; they provide public evidence of the independence of mind of the candidate; and they enhance the appointee’s legitimacy in undertaking his or her function, including providing the public with an insight into the candidate’s views on the policy issues related to the role.

3.On 12 June 2019, the House of Commons Liaison Committee published a report entitled Pre-Appointment Hearings, setting out revised guidelines for select committees carrying out pre-appointment hearings. The Liaison Committee noted that “Cabinet Office guidance requires the sponsor department to consult the Chair of the relevant select committee on the proposed selection process to fill a post subject to a pre-appointment hearing before any recruitment exercise begins. Committees may expect to receive drafts of the job description and person specification for comment”.1

4.Despite the Government’s commitment that its “preferred candidate for Chair of the regulator, and future Chairs, will appear before the Committee for pre-appointment scrutiny”,2 the Chair of the Committee was not consulted prior to the recruitment exercise being launched. The Committee did not receive drafts of the job description nor person specification for comment, and there was no reference to a pre-appointment hearing in the job description. We have not received an explanation from the Department as to why this was the case.

5.Cabinet Office guidance also states that “at least seven working days in advance of the scheduled date for the pre-appointment hearing, unless otherwise agreed, the Department should provide the relevant select committee with the information required to conduct pre-appointment scrutiny”. In this instance, the Committee was provided with the relevant information four working days ahead of the pre-appointment hearing. We have been frustrated by the Department’s engagement with us at all stages of the process. Pre-appointment hearings are a key part of scrutiny, and it is crucial that committees have the information they need in good time. We would like to put on record our frustration and dissatisfaction with the Department. We have not been told why the Chair was not consulted prior to the recruitment process being launched and at every stage of the process we have had to ask the Department for the information that should have been provided to us in a timely manner. Pre-appointment hearings are an important part of the scrutiny process; the Department should seek to facilitate the Committee’s work in this respect. The Department’s performance in this regard is no reflection on the candidate.

6.The nomination of Mr Dingemans as the Government’s preferred candidate followed the conclusion of an open recruitment campaign. Of the eight shortlisted candidates, three were women. Of the three appointable candidates, all were male and white with no declared disabilities. We have noted previously our disappointment and concern that so few public body chairs appointed by the Department are women. Again, whilst this is no reflection on Mr Dingemans as a candidate, it is an issue on which the Department is still not making visible progress.

7.The Committee held a pre-appointment hearing with Mr Dingemans on 17 July 2019. To inform the hearing, the Committee wrote to him on 3 July, seeking information on his interests and independence and his views on the FRC and its successor body. In accordance with the guidelines for pre-appointment hearings agreed by the Liaison Committee, we questioned Mr Dingemans on his personal independence and relevant financial interests.

8.The hearing addressed Mr Dingemans’ employment background and other experiences, plus a wide range of issues related to the FRC and its successor body the Audit, Reporting and Governance Authority, including audit reform, market surveillance, sanctions, stewardship and governance.

9.On the basis of the pre-appointment hearing, we are satisfied that Mr Dingemans has the professional competence and personal independence required of the Chair of the Financial Reporting Council. We endorse his appointment and wish him well for his tenure as Chair.

10.In endorsing this appointment, we make the following recommendations:

1 Liaison Committee, Third Report of Session 2017–19, Pre-Appointment Hearings, HC 2307, para 12

2 Business, Energy and Industrial Strategy, Eighteenth Special Report of Session 2017–19, The Future of Audit: Government Response to the Committee’s Nineteenth Report of Session 2017–19, HC 2296, p 10

Published: 22 July 2019