The chorus of scepticism that greeted Alistair Darling's appointment of Sir David Walker, the City grandee, to lead a government review into banks' corporate governance yesterday was deafening.

Not least after it emerged that Sir David will remain a senior adviser to Morgan Stanley. Apart from a three-year period when he chaired the London Investment Bankers' Association, Sir David worked at Morgan Stanley between 1994 and 2006, and retired as chairman of the bank's European arm.

The consultancy raises question marks over Sir David's independence and will add further fuel to yesterday's criticism of his appointment.

Vince Cable, the Liberal Democrat Treasury spokesman, called it a “classic Establishment cover-up”, while the Conservatives dismissed it as a “totally inadequate” response to the growing furore over bank bonuses.

Critics noted that the appointment of Sir David, who began his 48-year career at the Treasury, mimicked his task two years ago of formulating a code of conduct for the private equity industry. Sir David's review for the British Venture Capital Association was widely regarded as lacking bite at a time when venture capitalism was under intense scrutiny.

Sir David, 68, who lists his hobbies as music and long-distance walking, graduated from Queens' College, Cambridge, with a double first in economics. He worked at the Treasury from 1961 to 1977, although during this period he took a four-year sabbatical at the International Monetary Fund in Washington.

He then spent 15 years at the Bank of England before heading the Securities and Investments Board, the precursor to the Financial Services Authority, between 1988 and 1992. The following two years were spent as deputy chairman of Lloyds Bank.