On 5 December the Financial Reporting Council (FRC) published proposals for the latest revisions to the UK Corporate Governance Code (the Code), which are due to be published by June 2018 and will be effective for all accounting periods beginning on or after 1 January 2019. NEDonBoard is currently consulting the NEDs & Board Members community in order to send the appropriate answer by Feb 15th, 2018.
Q1. Do you have any concerns in relation to the proposed Code application date?
Q2. Do you have any comments on the revised Guidance?
Q3. Do you agree that the proposed methods in Provision 3 are sufficient to achieve meaningful engagement?
Q4. Do you consider that we should include more specific reference to the UN SDGs or other NGO principles, either in the Code or in the Guidance?
Q5. Do you agree that 20 per cent is ‘significant’ and that an update should be published no later than six months after the vote?
Q6. Do you agree with the removal of the exemption for companies below the FTSE 350 to have an independent board evaluation every three years? If not, please provide information relating to the potential costs and other burdens involved.
Q7. Do you agree that nine years, as applied to non-executive directors and chairs, is an appropriate time period to be considered independent?
Q8. Do you agree that it is not necessary to provide for a maximum period of tenure?
Q9. Do you agree that the overall changes proposed in Section 3 of revised Code will lead to more action to build diversity in the boardroom, in the executive pipeline and in the company as a whole?
Q10. Do you agree with extending the Hampton-Alexander recommendation beyond the FTSE 350? If not, please provide information relating to the potential costs and other burdens involved.
Q11. What are your views on encouraging companies to report on levels of ethnicity in executive pipelines? Please provide information relating to the practical implications, potential costs and other burdens involved, and to which companies it should apply.
Q12. Do you agree with retaining the requirements included in the current Code, even though there is some duplication with the Listing Rules, the Disclosure and Transparency Rules or Companies Act?
Q13. Do you support the removal to the Guidance of the requirement currently retained in C.3.3 of the current Code? If not, please give reasons.
Q14. Do you agree with the wider remit for the remuneration committee and what are your views on the most effective way to discharge this new responsibility, and how might this operate in practice?
Q15. Can you suggest other ways in which the Code could support executive remuneration that drives long-term sustainable performance?
Q16. Do you think the changes proposed will give meaningful impetus to boards in exercising discretion?