Among the many failures that led to the disaster at the Royal Bank of Scotland, there was obviously a failure of corporate governance. So it is only right that, along with all the other regulatory reviews, there should be a review of the governance of corporate governance.

In Britain, this is partly a matter of self-regulation, with companies expected to follow the best practice corporate governance standards set out in the so-called Combined Code.

It is surely only a matter of time before some headline-grabbing politician identifies the root cause of all our problems: we have been letting the rascals regulate themselves. What do you expect?

So it is very sensible for the Financial Reporting Council, which acts as caretaker of the Code, to try to get its retaliation in first. And it is very sensible that it will work closely with Sir David Walker, who is conducting a separate review of governance of banks.

Quite what should come out of the reviews is a more difficult question.

Critics of the British approach to corporate governance - particularly in America - enjoy pointing out that RBS was, in fact, a model pupil. It did everything by the book, ticked all the boxes and filled page after page of its annual report with an exhaustive analysis of its corporate governance performance.

In particular, it had a separate, non-executive chairman - a central pillar of the UK code, but far from standard practice in the United States - a post is designed to restrain an over-mighty chief executive. Yet the RBS chairman Sir Tom McKillop failed to restrain Sir Fred Goodwin, with catastrophic consequences for the bank and the taxpayer.

American critics of the British system claim that we are so focused on ticking the boxes that it makes us complacent. It is one thing following all the rules, but boards also have to ensure that they are working in practice (not that the Americans have much to crow about: think Citigroup, Merrill Lynch, Lehman Brothers and Bear Stearns).

There are a few obvious areas the review should examine.

The roles of chairman, chief executive and senior non-executive director need to be better-defined. The code should encourage non-execs to seek outside advice on big decisions (had the RBS directors taken advice on the ABN Amro takeover, they might have been prepared to say no to Sir Fred). It should consider whether there should be special rules applying to banks - it would clearly be advantageous if at least the chairman and members of the risk committee of banks had specialist experience.

The review should consider ways to encourage more active involvement of shareholders in corporate governance questions. And not just traditional institutions, but also sovereign wealth funds and even hedge funds.

The problem with all this is that, however they are structured, boards are only as good as the people on them.

And, for many reasons, the job of non-executive director of a big company, let alone chairman of a bank, is not getting any more attractive. Even good people fail. Look at the RBS board. It included the likes of Peter Sutherland and Sir Steve Robson. And, given that so many reputations have been tarnished by the credit crisis, the pool of good people is shrinking.

But it would be a mistake to allow the few good people to take on too many jobs. As chairman of BP, Mr Sutherland is now supporting the reappointment as a director of Sir Tom, whom he helped to become chairman of RBS. Sir Tom, the man ultimately reponsible for Sir Fred's pension, even sits on the BP remuneration committee.

This sort of thing looks too much like crony capitalism and is a gift for those who want to overturn the whole system.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive