2018 saw the publication of an updated UK Corporate Governance Code, the introduction of new corporate governance reporting requirements in The Companies (Miscellaneous Reporting) Regulations 2018 as well as the establishment of the Wates Corporate Governance Principles for Large Private Companies. The regulations and corporate governance provisions apply in relation to the financial years of companies beginning on or after 1st January 2019. Related post: Changes to corporate governance in the UK
In Q4 2019, NEDonBoard organised round-tables discussions with experienced NEDs and chairs from a variety of backgrounds and industries, with the objective to discuss the aforementioned changes affecting UK boardrooms and the resulting consequences for NEDs as individual professionals.
The discussions have highlighted that:
- There remains a lack of awareness of the UK Code in FTSE boardrooms, as many senior and experienced NEDs have not read the 2018 Code or do not fully understand its implications.
- This comes at a time of increased vulnerability of NEDs as individual professionals. Indeed, claims may be brought up against them by the Select Committee, regulators or shareholders, notably with the emergence of activism in the UK.
- There is also increased pressure from the public for NEDs to meet higher standards.
- The FRC does not promote the day-to-day implementation of the provisions of the UK Code, but NEDonBoard, the UK professional body for non-executive directors and board members does.
NEDonBoard hosted a panel discussion in January 2020 to promote and facilitate the understanding of the UK Corporate Governance Code and its implications to the community of NEDonBoard non-executive directors and board members. The panel discussion provided attendees practical recommendations on how to interpret the Code, protect yourself as a NED and implement a solid decision-making process at board level. The learning objectives of the panel were:
- Understand the context in which recent corporate governance changes have been adopted
- Increase your knowledge of the UK Corporate Governance Code
- Understand the implications of the Code
- Uncover board best practices to protect yourself as a NED and board member
Attending NEDonBoard panel events (or watching their replay) and investing in your professional development as a NED and board member demonstrate how you discharge your duty under section 172. Read the event headlines at this link.
Written by Elise Perraud, NEDonBoard COO
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