Barclays to respond to concerns over Barrett appointment

Barclays yesterday signalled it would provide a speedy explanation for moving its chief executive into the chairman's role, after a series of City heavyweights publicly demanded the bank formally justify its decision.

A spokesperson for Barclays said it would be "prompt" in publishing the reasons for allowing Matt Barrett, the chief executive, to step into the chairman's seat at the end of next year - a move which flouts the Higgs code on corporate governance. Derek Higgs, who compiled the principles, said allowing chief executives to become chairmen of the same company could inhibit their ability to be independent and to hold executive directors properly to account. His code says if companies decide to break the rule, they ought to explain why to shareholders formally.

There is mounting pressure on Barclays to offer its reasons. David Prosser, the chief executive of the insurer Legal & General, which owns nearly 4 per cent of Barclays' shares, said yesterday: "We do expect Barclays to give its reasons in writing, in the spirit of the 'comply or explain' rule."

A spokesperson for the National Association of Pension Funds, which has been outspoken in its criticism of poor corporate governance in this year's annual general meeting season, said: "We are waiting for an explanation. Given that Barclays would have had its reasons in mind when Mr Barrett took the job, why shareholders have to wait to hear them is interesting."

Barclays responded to a letter from the Association of British Insurers on Friday asking for an explanation by saying it would offer one some time "next year". However, yesterday it seemed to commit itself to a speedier timetable.

Sir Peter Middleton is to retire as chairman of Barclays.