London gold trade agrees reforms to boost transparency
The pressure for change is increasing also because China, the metal's largest consumer and producer, is competing with London to increase market share as a price setter with a yuan-denominated gold benchmark.
Currently, the LBMA has a management committee made up of representatives from eight firms including six banks, which are also involved in the trading of bullion.
But a majority of members, including banks, refiners and dealers, voted on Wednesday to create an independent board of directors comprising two bank market makers and three LBMA members.
The LBMA's chief executive Ruth Crowell and two employees of the association would also be on the board.
"The new structure is congruent with new market conditions, so we will now have an independence and oversight governance that is needed," Sharps Pixley CEO Ross Norman told Reuters.
"The LBMA don't hide from the notion that the decision-making process currently can sometimes be slower than they would like and with a new board in place they will be able to push through and make quicker, better decisions," Norman said.
Bullion dealer Sharps Pixley is an ordinary member of the LBMA.
The need to make the $5 trillion a year over-the-counter market more transparent, profitable and liquid led the LBMA to formally ask exchanges and technology firms in October last year to bid for services such as a gold exchange or a clearing platform.
A decision on the winning bidder should be known in September.