UK Corporate Governance Code Definition

GLOSSARY

What does UK Corporate Governance Code mean?

A code of principles to do with the way in which companies, particularly quoted companies, should behave in relation to their proper management

Formerly Combined Code, so-called because it incorporates codes from a variety of proponents, including Cadbury, Greenbury, Higgs, Hampel, Turnbull and several others, which individually were limited but collectively had greater impact.

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Managing discussion and shareholders' questions—listed company AGMs—checklist

Managing discussion and shareholders' questions—listed company AGMs—checklist This checklist provides guidance on the questions and discussions at Annual General Meetings (AGMs) of listed public companies and AIM companies. It covers legal aspects, corporate governance best practice and practical guidance, as well as tips for the chair and company secretary in preparing for debate and unexpected events at a company's AGM. The chair of the meeting is responsible for managing discussion at the meeting and must do so in an impartial manner. It is the chair’s role to keep discussion under control and to decide when to close discussion on a particular matter once they consider that it has been debated sufficiently and has enabled a range of views to be heard. When the UK was a member of the EU, Directive 2007/36/EC (the Shareholder Rights Directive) codified the right of shareholders to have questions answered at general meetings. The Directive was implemented in the UK by the Companies (Shareholders' Rights) Regulations 2009 which amended Part 13 of the Companies Act...

FCA consultation paper tracker—2019 [Archived]

FCA consultation paper tracker—2019 [Archived] This tracker sets out the consultation papers published by Financial Conduct Authority (FCA) in 2019, along with the publication of any subsequent rules and guidance. For details of FCA consultation papers from other years, see: FCA consultation paper trackers. For details of Prudential Regulation authority (PRA) and Financial Services Authority (FSA) consultation papers, see: • PRA consultation paper tracker [Archived] • FSA consultation paper tracker [Archived] Topic area Consultation Paper Description Publication date End of consultation period Policy Statement/Handbook Notice BrexitAuthorisation, approval and supervisionComplaints, compensation and claims managementRegulation of capital marketsPayment services and systems Regulation of personal pension and stakeholder products CP19/33: Quarterly Consultation No 26 The Financial Conduct Authority (FCA) has published Quarterly Consultation Paper No 26 (CP19/33), in which it consults on proposed miscellaneous amendments to the FCA Handbook:—clarification of the rules relating to Financial Services Compensation Scheme claims against appointed representatives and principals—changes to the Listing Rules’ requirements, which cross-refer to the Prospectus Regulation, for information to...

The UK Corporate Governance Code

The UK Corporate governance Code (the UKCG Code) is an important part of the UK’s corporate governance regime. It is administered by the Financial Reporting Council (FRC).Evolution of the UKCG CodeFollowing a number of high profile corporate scandals, the Committee on the Financial Aspects of Corporate Governance was established in May 1991 to review the aspects of corporate governance relating to financial reporting and accountability. The committee was chaired by Sir Adrian Cadbury and its final report, The financial aspects of corporate governance, was published in December 1992 (it is usually known as the Cadbury Report).The Cadbury Report contained a number of recommendations to raise standards in relation to the control and reporting functions of boards of directors, as well as the role of auditors, which were gathered together in a Code of Best Practice. Listed companies were required by the then Listing Rules to state in their report and accounts whether or not they complied with that Code of Best Practice and to identify, and give reasons for, any...

The corporate governance statement

The UK Corporate governance Code (UKCG Code) sets out standards of good practice in relation to leadership and effectiveness of the board of directors, remuneration, accountability, transparency and relations with shareholders.The FRC’s UKCG Code and associated guidance such as the Guidance on Board Effectiveness applies to companies with a listing of equity shares in the equity shares (commercial companies) category.In January 2024, the FRC published a new version of the UKCG Code (2024 UKCG Code). The 2024 UKCG Code applies to companies with a listing of equity shares in the equity shares (commercial companies) category with accounting periods beginning on or after 1 January 2025, with the exception of Provision 29 regarding internal controls, which applies to companies with accounting periods beginning on or after 1 January 2026. For details on the changes made to the UKCG Code, see News Analysis: UK Corporate Governance Code 2024 published—what’s changed? and Practice Note: The UK Corporate Governance Code.For a general overview of the application, purpose and provisions of the UKCG Code, see...

Discover our 196 Practice Notes on UK Corporate Governance Code

Memorandum on the responsibilities and obligations of a director of an AIM company

Memorandum on the responsibilities and obligations of a director of an AIM company 1 Introduction 1.1 This memorandum has been prepared for the directors and proposed directors (the Directors) of the Company to provide a general introduction to the principal responsibilities and obligations of a director of a company whose shares are admitted, or will be admitted, to AIM, a market operated by London Stock Exchange plc (LSE). 1.2 Once a company’s securities are admitted to trading on AIM, a company and its directors are subject to an increased layer of regulation. This includes requirements set out in the AIM Rules for Companies published by the LSE (AIM Rules), the Disclosure Guidance and Transparency Rules sourcebook (DTRs), the Prospectus Rules and the Market Abuse Regulation. 1.3 As a Director, you will be responsible (individually and collectively with your fellow Directors) for the Company's compliance with these provisions. The LSE has the power to fine or publicly censure an AIM company in the case of a...

Executive service agreement

Executive service agreement This Agreement is made on [date] Parties 1 [Name of company], a company incorporated in England with registered number [number] whose registered office is at [address] (the Company); and 2 [Name of employee], of [address] (you). The parties agree: 1 Definitions and interpretation 1.1 In this Agreement the following expressions will, unless the context otherwise requires, have the meanings set opposite them: Basic Salary • the meaning given to it in Clause 8.1; [Board • [the directors of the Company present at a meeting (i) of directors of the Company or (ii) of a duly appointed committee of directors of the Company[, such meeting to be convened and quorate in accordance with the articles of association of the Company and the Companies Act 2006] OR the directors of the Company present at a meeting of directors of the Company[, such meeting to be convened and quorate in accordance with the articles of association of the Company and the Companies Act 2006] ];]...

Dive into our 24 Precedents related to UK Corporate Governance Code

Is there an exact origin or any authority for the notion of collective responsibility by a board of directors?

Is there an exact origin or any authority for the notion of collective responsibility by a board of directors? For companies subject to the Model articles—private limited company—after 28 April 2013, the wording in model article 3 is significant: ‘Subject to the articles, the directors are responsible for the management of the company’s business, for which purpose they may exercise all the powers of the company.’ Further, the opening words of model article 5 (delegation) are generally seen as confirming the concept of collective responsibility: ‘Subject to the articles, the directors may delegate any of the powers which are conferred on them under the articles….’ As referenced in Practice Note: Powers of directors, the concept of collective responsibility (in the context of authority of directors) is discussed in detail in Authority of individual directors: Butterworths Corporate Law Service, CL[10.19]–[10.20], most notably: ‘In considering the usual authority of directors it is as well to be reminded that they act as a board. An individual director, as such,...

Does a director seeking re-election at an AGM have to be present at the AGM?

Does a director seeking re-election at an AGM have to be present at the AGM? There is no requirement under the Companies Act 2006 (CA 2006) for a director to attend an annual general meeting (AGM) which will be considering a resolution for their re-election. However, in line with guidance offered by The Chartered Governance Institute (formerly known as ICSA: The Governance Institute) (CGI), The Chartered Governance Institute guide to best practice at annual general meetings [Archived], it will be viewed as best practice to ensure that, wherever possible, all directors attend the AGM. In particular, Section 2.1 of the guidance states: 'It is best practice to ensure that, wherever possible, all directors attend the AGM. Given what we have said about the AGM being the principal forum in which directors account to the shareholders for their stewardship of the company, we regard it as very important that all directors make themselves available to attend the company's AGM.' That being said, the caveat,

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Share Incentives weekly highlights—12 December 2024

This week's edition of Share Incentives weekly highlights includes (1) in relation to employee benefit trusts, the cases of JTC Employer Solutions Trustee Ltd v Garnett and also MR Currell Ltd v Revenue and Customs Commissioners, (2) the Welsh Government publishing its Budget for 2025–26, and (3) a consultation published by the Financial Conduct Authority which includes proposals for updating the FCA’s Handbook to align with the new edition of the UK Corporate Governance Code that was published in January 2024.

Environment weekly highlights—12 December 2024

This week's edition of Environment weekly highlights includes: news analysis on the 29th Conference of the Parties of the United Nations Framework Convention on Climate Change (COP29) outcomes, some of the key UK and international climate litigation developments in 2024 pertaining to the energy sector, the key takeaways and what is on the horizon for 2025 and beyond and insured losses from natural catastrophes projected to pass US$135bn in 2024, marking the fifth consecutive year in which the total exceeded US$100bn, according to a report by the Swiss Re Institute. It also covers Friends of the Earth (FoE), along with co-claimants, Doug Paulley and Kevin Jordan’s appeal against the High Court's October 2024 decision, which dismissed their legal challenge to the UK government's National Adaptation Programme 3 (NAP3) and the United Nations Environment Programme (UNEP)’s adjournment of negotiations for a legally binding global treaty on plastic pollution until 2025, following the conclusion of the fifth session in Busan, South Korea. In additions this week, the Department for Energy Security and...

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GLOSSARY