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FirstFT: UK government accused of failing to support accounting regulator

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The architect of an overhaul of the UK accounting regulator has accused the government of failing to support the industry watchdog responsible for promoting good corporate governance.

Sir John Kingman said it was inexplicable that ministers had not started the search for a new chair of the Financial Reporting Council almost 14 months after Simon Dingemans resigned.

Kingman said in a letter to the FT that the FRC, which is the custodian of the corporate governance code for listed companies, had made “good progress” under Sir Jon Thompson, its chief executive.

“Nevertheless, it is indefensible that the body responsible for promoting good corporate governance in Britain not only lost its chair more than a year ago, but is about to lose its excellent interim chair as well, and the government has inexplicably still not begun the process to appoint a successor,” added Kingman, chair of Legal and General.

Five more stories in the news

1. Pinault family joins European Spac push The French billionaire family is aiming to raise as much as €300m for a blank-cheque company that will focus on the entertainment and leisure industries. The special purpose acquisition vehicle, named I2PO, is being launched in Paris today.

2. US inflation picks up pace The pace of US consumer price increases accelerated unexpectedly in June, jumping 5.4 per cent from the previous year, challenging the view within the Federal Reserve and White House that high inflation will be temporary. What is driving US inflation higher? Colby Smith explains.

Line chart of Year-over-year change (%) showing US consumer price index soars

3. BBC’s political channel faces cuts BBC Parliament is facing significant cuts as the corporation seeks £1bn in savings to the overall budget by March 2022. The channel will scale back programming from the autumn, according to people with knowledge of the plans.

4. Biden to warn US companies on Hong Kong The White House plans to warn companies of the rising risks of operating in Hong Kong as China asserts more control over the financial hub. The move, which the sources said would probably come on Friday, would mark the first time the US has issued a business advisory for Hong Kong.

5. Goldman and JPMorgan pivot to M&A The two US banks have benefited from a boom in dealmaking activity as trading revenues plunged from record levels during the start of the pandemic. Both banks reported a surge in fees from advising on corporate acquisitions and IPOs during the second quarter, which helped offset declining returns from bond and stock trading.

Coronavirus digest

  • France will make vaccination compulsory for healthcare workers and will restrict access to cafés, restaurants and other venues to those with “health passports”.

  • The mayor of London and other UK leaders have broken with Boris Johnson’s government by insisting on mask wearing on public transport after most restrictions end in England next week.

  • Pop star Olivia Rodrigo will meet President Joe Biden and chief medical adviser Anthony Fauci today to promote vaccination among youths.

Follow the latest with our coronavirus live blog and sign up for our Coronavirus Business Update newsletter for more Covid-19 news.

The day ahead

Bastille Day If you are a French citizen, you can add to your liberté a side order of égalité and fraternité as Bastille Day is celebrated today. In Paris, President Emmanuel Macron will watch a military parade and honour health workers.

EU climate proposals The European Commission will unveil its long-anticipated “Fit for 55” package aimed at reducing net greenhouse gas emissions 55 per cent by 2030 from 1990 levels.

England T-Level reforms The government will announce plans to restructure the 16-plus education sector in an effort to boost take-up of vocational qualifications, despite backlash from technical college leaders.

US bank earnings Bank of America, Wells Fargo and Citigroup report earnings. Elsewhere in US finance, Jay Powell will offer the Fed’s semi-annual monetary policy report in a virtual hearing before the US House financial services committee.

What else we’re reading and watching

The G20 has failed to meet its challenges The lack of a truly global response to Covid-19 augurs badly for common action on climate change. Next to these global challenges, the agreements on corporate taxation and special drawing rights, welcome though they are, are not that important, writes Martin Wolf.

Martin Wolf: ‘We meet, fail and promise to do better next time. But then we fail again’
Martin Wolf: ‘We meet, fail and promise to do better next time. But then we fail again’ © James Ferguson

BHP rape cases Five years on from setting a goal of achieving a 50-50 gender balance by 2025, the world’s biggest miner is racing to reassure women that it can offer a safe working environment following allegations of two rapes in Western Australia.

Can the Olympics succeed behind closed doors? The Tokyo Games promised to revive Japan’s self-confidence after decades of economic stagnation, opening its doors to the world as an equal, and spiritually reconnected to the youthful nation of the 1964 games, when the country announced itself as a democratic power. Covid-19 threatens those goals.

Do you think the Tokyo Olympics should proceed as planned given the Covid-19 situation? Tell us what you think in our poll.

Time for AI to pull up a chair to the negotiating table Science fiction has sparked decades of debate about whether future wars will be made more deadly by weaponised artificial intelligence. But in the real world, AI is already being harnessed to broker peace, writes Helen Warrell.

What business leaders can do about biodiversity The World Economic Forum estimates that half of global GDP, or $44tn, depends on nature. Gillian Tett examines what business executives can do to protect environmental assets. Get the latest on socially responsible business with our Moral Money newsletter. Sign up here.

Video: What business leaders can do about biodiversity

Food & Drink

Grilled peaches and silken tofu Griddling peaches, as Ravinder Bhogal does in this recipe, ekes out their natural sweetness. They pair perfectly with the bittersweet Thai basil in the zesty gremolata.

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