Archives: Corporate Governance

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Changes to the Persons with Significant Control Regime

The Fourth Money Laundering Directive ((EU) 2015/849) (“MLD4″) must be transposed into national law by 26 June 2017. MLD4 requires (amongst other things)  corporate and other legal entities to disclose their beneficial owners. In many respects this is currently being done under the PSC regime. However, MLD4 goes further than the PSC regime in two … Continue Reading

New Long-Term Reporting Guidance

The Investment Association (“IA”) has published new guidance on long-term reporting which it is encouraging companies to adopt as soon as possible. This follows on from the IA’s call some 6 months ago to cease quarterly reporting in favour of more meaningful long-term reporting. The guidance applies to  companies whose shares are admitted to the Premium … Continue Reading

PIRC Shareowner Voting Guidelines 2017

PIRC has published the 2017 edition of its UK Shareowner Voting Guidelines, replacing last year’s version.  Additions to the guidelines include the following: PIRC will oppose the re-election of an executive chairman except in exceptional circumstances. PIRC supports the Hampton-Alexander Review and the Davies Review recommendation that 33% of board positions in FTSE 350 companies be held by women by … Continue Reading

Corporate Governance Changes Ahead?

If the Business, Energy and Industrial Strategy Committee’s recent report on its inquiry into corporate governance is anything to go by, we may be seeing significant changes ahead. Whilst the report does not believe that a fundamental overhaul of the current framework is necessary it makes a number of noteworthy recommendations, including: The UK Corporate Governance Code requiring informative narrative reporting … Continue Reading

Race in the Workplace

Last month Baroness McGregor-Smith published her review on race in the workplace, focusing on the issues affecting black and minority ethnic (BME) groups in the workplace. In all, the review made some 26 recommendations and estimated that the UK economy could benefit from a £24bn a year boost if BME talent was fully utilised. The government has now … Continue Reading

Reporting on Payment Practices and Performance

The government has published the Reporting on Payment Practices and Performance Regulations 2017. The regulations come into force on 6 April 2017 and, subject to certain exceptions, the duty to report will apply in relation to financial years beginning on or after 6 April 2017. The regulations only apply to “qualifying” companies incorporated within the UK. … Continue Reading

Remuneration Committee Challenges in 2017

Colleagues have published a new post,  That Was the Year That Was: Challenges in 2017 for Remuneration Committees, on the Compensation and Benefits Global Insights blog. Before the 2017 AGM season gets into full swing, this post looks back at what happened in the executive pay sphere during 2016 and looks forward to the challenges that remuneration … Continue Reading

PLSA Revised Corporate Governance Guidelines

The Pensions and Lifetime Savings Association (PLSA) has published a revised version of its Corporate Governance Policy and Voting Guidelines. The main changes in emphasis include the following: Leadership: In addition to a board’s accountability to shareholders for protecting and generating sustainable value over the long term, the Guidelines specifically state that directors are required … Continue Reading

AIM Disciplinary Notice: Breach of Rule 31

The London Stock Exchange has published AIM Disciplinary Notice 15. The AIM company involved has been privately censured and fined £75,000 for a breach of AIM Rule 31 (AIM company and directors’ responsibility for compliance). The AIM Disciplinary Committee (“ADC”) determined that the AIM company had failed to: Provide its nomad with information reasonably required to carry … Continue Reading

AIM Rules Social Media

AIM Regulation has published an Inside AIM update on how social media (such as “twitter”, Facebook and the company’s website) interacts with the disclosure obligations under the AIM Rules. It has also clarified that these forms of communication are subject to the same rules regarding disclosure of regulatory information. In addition, if disclosure by social … Continue Reading

Ethnic Diversity of UK Boards

The Parker Review Committee has published a consultation version of a report into the ethnic diversity of UK boards. The report finds that ethnic minority representation on the boards of FTSE 100 companies is disproportionately low, representing only 8% of the total director population compared to constituting 14% of the UK population. The report includes several recommendations … Continue Reading

ESMA Guidance on Market Soundings

The European Securities and Market Authority has published its final guidelines on the steps and the records that a person receiving a market sounding will have to consider and implement according to Article 11(11) of the Market Abuse Regulation (EU) No 596/2014 (MAR). A market sounding is the disclosure of information to one or more potential investors, … Continue Reading

“A change has got to come!”

A number of themes trailed in Theresa May’s first speech after securing the Conservative nomination,  were repeated at last week’s Conservative Party conference in Birmingham. The new Government reiterated its intention to occupy the centre ground of British politics and the delivery of this political objective will undoubtedly have implications for corporate Britain – in … Continue Reading

Corporate Governance Inquiry: Are Employee Representatives Coming to the Boardroom?

The Business, Innovation and Skills House of Commons Select Committee has launched an inquiry on corporate governance, focusing on directors’ duties, executive pay and the composition of boards. Interestingly, the inquiry raises the question, “Should there be worker representation on boards and/or remuneration committees?”. This echoes Theresa May’s speech on 11 July when she said … Continue Reading

Corporate Culture and the Role of Boards

Colleagues have published a post, Culture Club: FRC strengthens link between company values and executive remuneration on the Compensation and Benefits: Global Insights blog. The FRC Report, entitled “Corporate Culture and the Role of Boards“, covers many aspects of the actions and behaviours of a company in establishing, communicating and maintaining its culture and values.  The post explores the … Continue Reading

Updated Directors’ Remuneration Reporting Guidance

Colleagues have published a new post, The Executive Remuneration Games: updated guidance on the Compensation and Benefits Global Insights blog. The post looks at the GC100 and Investor Group’s recently published updated directors’ remuneration reporting guidance. This reflects the changes in practice since their original guidance in 2013 and the voting patterns of the 2016 AGM season.  The … Continue Reading

Final Report on Boardroom Pay

Colleagues have published a post on the Compensation and Benefits Global Insights blog regarding the Executive Remuneration Working Group’s (ERWG) much-anticipated final report on simplifying and re-aligning executive pay in the UK.  The ERWG hopes that this report will have a major influence on how executive remuneration in FTSE companies is structured. Read more here.  … Continue Reading

Employee/Consumer Representation On Company Boards ?

If Theresa May does go ahead and impose employee/consumer representation on company boards, there are likely to be unintended knock-on consequences.  In particular, it is likely to inhibit open discussion at board level because it is difficult to see an employee representative being able to withhold all board information from the employee constituency that they represent.  That … Continue Reading

Resolution for Disapplying Pre-Emption Rights

The Pre-Emption Group has published a monitoring report on the implementation of its 2015 Statement of Principles for disapplying pre-emption rights and a template resolution for disapplying pre-emption rights. The monitoring report reveals that the 2015 Statement of Principles was generally adhered to but, having considered the views of investor representatives on best practice, the Pre-Emption … Continue Reading

Revised CG Code and Guidance on Audit Committees

The Financial Reporting Council has published its final draft of the UK Corporate Governance Code which is expected to apply (subject to Parliamentary approval) to accounting periods beginning on or after 17 June 2016 and to all companies with a premium listing of equity shares regardless of whether they are incorporated in the UK or elsewhere. The draft follows … Continue Reading

Executive Remuneration: IA’s Interim Report

The Squire Patton Boggs’s Compensation and Benefits Global Insights blog is hosting a new post entitled “Shareholder Spring 2: Rabbit Emerges From The Hat”. The post looks at the Investment Association’s Interim Report which will be used to inform a revision of the IA’s “Principles of Remuneration”. Essentially, they are looking to fix an executive remuneration … Continue Reading
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