Revised Corporate Governance now implemented
A revised UK Corporate Governance Code (CGC) will come into force for the accounting periods beginning 1st January 2019.
The revised CGC was put forth by the Financial Reporting Council (FRC) as an initiative to “restore public trust” in businesses.
The revision now means that all companies who have a “premium listing” of equity shares within the UK are now required to also report the CGC within their annual reports and accounts.
By doing so, the FRC also aims to promote “transparency and integrity” within business generally, as a way of financial reporting and monitoring, in which the definition of Corporate Governance itself is “the system by which companies are directed and controlled”.
Following from this, the UK Government also plans to introduce “secondary legislation” which shall be applicable to all companies, both public and private, within the UK to demonstrate how their directors comply with Section 172 of 2006 Companies Act in relation to a Directors Duties.
The revised CGC is also exempt for all companies which are below the FTSE 320. This is because CGC is aimed specifically at “premium listed” companies, in which via CGC should have the “highest levels of governance”.
The sections within the revised code which are as follows:
- Leadership and Purpose
- Division of responsibilities between board members
- Composition, succession and evaluation of the board
To read more about the revised UK CGC, please click here.
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