The "comply or explain" approach to guidance and provisions under the Combined Code provides the surest route to better corporate governance practice in BOFIs. The most critical need is for an environment in which the challenge of the executive is expected and achieved in the boardroom before decisions are taken on major risk and strategic issues. The remit and responsibility of board remuneration committees should be extended beyond board members to cover the whole entity. Performance conditions and deferment in respect of variable pay for executive board members and other senior executives should be materially more demanding than previously. The recommended disclosure should ensure that prospective clients know whether a fund manager in pitching for their business operates a model that includes engagement with long-term performance improvement.