25 July 2012
New forums should be created as a bridge between investors and financial services firms, it is believed.
According to a new review of the financial industry carried out by John Kay, a professor at the London School of Economics, firms need to focus on returns for savers and investors, rather than short-term rewards.
The review suggested that the pay and bonuses offered to employees working in the sector should match long-term goals instead of "short term gains".
Professor Kay said: "A lack of trust and poorly aligned incentives have helped create a culture of short-termism in our financial markets.
"This is undermining their role of supporting innovative, sustainable long-term business performance."
His report calls for the rules to be scrapped that make it mandatory for stock market-listed firms to publish updates each quarter.
The review was originally commissioned by Vince Cable, the country's business secretary.
Copyright Press Association 2012
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