Michael Grade became chairman in April 2004

Speaking at a media conference in Oxford he said the BBC needed to change to ensure effective regulation.

He added that any reforms had to ensure the independence of the BBC and accountability to licence fee payers.

Mr Grade was appointed chairman following a turbulent time at the BBC in the wake of the Hutton Report.

The report criticised the BBC for its handling of a news report on the Iraq war and led to resignations of director general Greg Dyke and chairman Gavyn Davies.

'Objectivity guaranteed'

Mr Grade told the Oxford Media Convention he was aware when he took the job that there needed to be a building of confidence that the governors could represent the public interest.

"Our new system is up and running. Although not complete in every detail yet, it is delivering," he said.

"It's already clear that it does enable us to engage closely enough to scrutinise management activity, while at the same time giving us enough distance and formality of process to guarantee objectivity on behalf of licence-fee payers.