The Financial Reporting Council (FRC) has announced plans for a major review of the UK Corporate Governance Code in response to its work done on corporate culture and succession planning, and the issues raised in the Government’s Green Paper and the BEIS Select Committee inquiry.
In its response to the Government’s Green Paper on Corporate Governance Reform the FRC will consider:
- the importance of helping boards take better account of stakeholder views;
- linking executive remuneration with performance; and
- extending the FRC’s enforcement powers to ensure that disciplinary action can be taken against all directors where there have been financial reporting breaches.
The review is expected to build on current strengths of UK Governance such as the unitary board, strong shareholder rights, the role of stewardship and the “comply or explain” approach, but will also focus on the growing demands on the Corporate Governance framework.
The FRC plans to undertake a full consultation with a wide range of stakeholder and have established a Stakeholder Advisory Panel of high profile representatives from a variety of sectors to assist them through the process.
The consultation on FRC proposal is expected later in 2017, based on the outcome of the review of the Government’s response to its Green Paper.
If you feel that issues highlighted in this article are likely to affect your reporting and would like to discuss this further with one of our specialist, you can contact AVEY of London on:
Tel: 01707 691 783
Email: info@aveyoflondon.co.uk
This guidance is designed to alert to an important issue of general application. It is not intended to be a definitive statement covering all aspects of the related legislation. It is only a brief summary and no action should be taken without consulting the detailed legislation or seeking professional advice. No responsibility for any person acting or referring to act as a result of any material contained in this guidance can be accepted by AVEY of London.