Faced with a problem, the classic government response is to set up a review. Often such reports languish ignored, their authors forgotten. This was not the case for Sir Derek Higgs, whose sudden death was announced on Tuesday. His 2003 review of the role of non-executive directors in UK companies broke ground when it was published and has framed the debate about boardroom duties ever since.

His review came in the wake of the Enron scandal. An inconclusive or complacent outcome would have increased pressure on ministers to bring in tighter regulation, as the US was doing. Executives who complained that Higgs was about box-ticking would have had far more to worry about if his report had led to government legislation.

Instead, the hard-hitting measures to improve boards’ answerability to shareholders are inherently flexible, because they are part of a code rather than set out in statute. Companies can choose not to comply and take the option of explaining themselves to investors.

Sir Derek was not the boardroom reformer central casting would have sent. In particular, he was a director of British Land, which he had advised as an investment banker and which was not seen as a model of good corporate governance when the review started.

So it is a powerful tribute to him that his report saw so clearly the need for an end to cosiness. It called for more – and more independent – non-executives, holding powerful positions on board committees. It wanted greater boardroom diversity. It promoted the role of the senior independent director, to whom investors could turn if relations with the chairman went wrong. And it demolished the idea that the obvious next step for a retiring chief executive was the chairmanship. At the time, many directors found such ideas outlandish: now they are orthodox, within the UK.

Of course, no report can guarantee ideal corporate conduct. Some non-execs will do too little, while some executives will enjoy too much power. But directors and investors have generally behaved with common sense to enable the system to work effectively.

There are tougher challenges ahead. When trading conditions worsen, it is easy for directors to allow initiatives such as board evaluation or succession planning to lapse as they focus on operational performance. That would be a mistake. The purpose of good governance is to reduce the cost of capital because investors face lower risks in well-governed companies. That should hold good in dark times even more than when the sun is shining.