Lord Myners to join Co-op board
Former Treasury Minister Lord Myners has been appointed to the board of The Co-operative Group and will head up its review into how the troubled business is run.
Lord Paul Myners, whose previous City roles include as chairman of retail giant Marks & Spencer, will take on the newly created role of senior independent director at the mutual.
He will lead a review of the group's 160-year-old democratic process, as well as the make-up of its board and how it is chaired.
His appointment comes as the Co-op faces mounting questions over corporate governance standards following the scandal surrounding disgraced former Co-op Bank chairman Paul Flowers and financial woes at its banking arm.
Concerns have been raised over the appointment process to the mutual's board amid fears that ethical standards have taken precedence over experience when key figures have been appointed into power.
Ursula Lidbetter, the recently hired chair of The Co-op Group, said: " Our rules allow for the appointment of independent non-executive directors to strengthen the elected board members, and now is the right time to make that move."
She added: "We have made it clear that we need to modernise and to embed the very best standards of corporate governance - while also ensuring that the voices of all our members and customers resonate through the business.
"Paul is ideally placed to oversee that work given his extensive experience across business and public life."
The Co-op will further strengthen its board with another two independent non-executive directors, it added.
Lord Myners was appointed Treasury Minister in October 2008, at the height of the financial crisis - a role he held until May 2010.
He has also chaired a number of firms, including Land Securities and Guardian Media Group, and was previously deputy chairman of electricity provider PowerGen, since bought by German firm E.ON.
He said the Co-op group has a "long and proud history at the heart of communities up and down Britain".
But he added: "Right now it faces serious challenges in terms of business performance and ensuring that the right governance is in place to deliver in the interests of all its members and customers."
The Co-op pledged a root-and-branch review of its democratic structure and corporate governance last month following allegations over the behaviour of Mr Flowers, who has been bailed after being questioned by police officers investigating allegations of drug supply offences.
It emerged in parliamentary hearings that Mr Flowers notched up just four years of relevant banking experience - and those were gained while working at NatWest bank after leaving school more than 40 years ago.
He presided over the bank's board at a time when it incurred mounting losses and amassed a £1.5 billion black hole in its balance sheet.
It is now set to fall into the hands of a group of investors, including US hedge funds, and is expected to close around 50 of its 324 branches, leading to hefty lob losses.
There have also been worries over the make-up and appointment process to the wider group board.
Its democratic process sees directors voted for by members and the chairman can only be appointed from within its board.
The Co-op faces a full Treasury-led inquiry into the Co-op Bank's ailing finances and the decision to appoint Mr Flowers, while the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) are considering a formal enforcement investigation into the bank.
In July, the mutual appointed f ormer Treasury mandarin Sir Christopher Kelly to head an independent investigation into what went wrong at its banking business.