UK: ICSA consults on the effectiveness of the independent evaluation of listed company boards

In the statement published last year following its insolvency and corporate governance consultation, the Department for Business, Energy and Industrial Strategy stated that it had invited ICSA to convene a group with the purpose of identifying ways to improve the quality and effectiveness of board evaluations: see here (pdf, para. 1.66). The group has been formed and a day or so ago published a consultation paper: see here (pdf). The paper begins by seeking views on the purpose of board evaluation before summarising the evidence regarding current practice. It then invites suggestions and views on various matters and proposals, including a code of practice for the providers of board evaluation services and voluntary principles for listed companies when engaging external reviewers.

UK: ICSA / IA guidance - the stakeholder voice in board decision making

ICSA and the Investment Association have published a guidance document titled The Stakeholder Voice in Board Decision-Making: see here (pdf). The guidance - welcomed by the Government and Financial Reporting Council - contains ten core principles, and its purpose is "...to help company bards think about how to ensure they understand and weigh up the interests of their key stakeholders when taking strategic decisions".

UK: ICSA consultation on the practice of minuting meetings

ICSA - the Institute of Chartered Secretaries and Administrators - has published a consultation paper on the practice of minuting meetings: see here (pdf). The role, purpose and standard of minutes has been the subject of recent Parliamentary attention: see the letter sent by the Rt Hon Andrew Tyrie MP, chairman of the Treasury Committee, to the chief executive of ICSA: here (pdf). Indeed, the first question asked by ICSA in its consultation paper is this: what is the principal function of meeting minutes?

UK: IBE report - FTSE350 board committees - corporate responsibility, sustainability and ethics

The Institute of Business Ethics, in conjunction with ICSA and Mazars, has published a report exploring the role of FTSE350 board committees formed with specific responsibility for corporate responsibility, sustainability or ethics: see here (pdf). The report notes that 30 companies in the FTSE100 and 25 in the FTSE250 have formed such committees; these committees are more common in sectors with reputation and regulatory risk (e.g., banking, mining, defence). The report also explores the mandate given to such committees. An overview of the report is available here (pdf).

UK: ICSA report - "The company secretary: building trust through governance"

ICSA has published a report titled The Company Secretary - building trust through governance: see here. The report, which draws on research led by Professors Andrew and Nada Kakabadse, notes that many of those interviewed - including chairmen - recognise the important and unique function performed by the company secretary. Many company secretaries, however, said that their role was largely taken for granted and often improperly utilised. The report identifies and explains how high performing company secretaries are able to contribute to good governance through helping to build trust.

UK: ICSA consultation on the content of annual reports

ICSA has published a short consultation paper seeking views on a contents list for company annual reports, the purpose of which is to assist those preparing reports: see here (pdf). The consultation is being published following a request from the Department for Business, Innovation and Skills.

UK: ICSA publishes stewardship dialogue guidance

The Institute of Chartered Secretaries and Administrators has published guidance titled Enhancing Stewardship Dialogue, the purpose of which is to facilitate good engagement practices between boards and their shareholders: see here (pdf). Further background information is available here.

UK: ICSA consultation - improving engagement practices between companies and institutional investors

The Institute of Chartered Secretaries and Administrators, in conjunction with the Investor Stewardship Working Party (a group of six institutional investors), has published a consultation paper titled Improving engagement practices between companies and institutional investors: see here (pdf). The purpose of the consultation is to seek views on various matters in order to prepare guidance on good engagement practice.

UK: survey of board evaluations - ICSA report

ICSA has published the results of its annual survey of how board evaluations have been carried out by the largest UK listed companies: see here (pdf). The survey reports that 33 of the 200 companies in the survey undertook some form of external board evaluation. The UK's Corporate Governance Code, published last year, recommends that evaluation of FTSE350 company boards should be externally facilitated at least every three years (Code Provision B.6.2). Main Principle B.6. states that the board should, on an annual basis, evaluate its own performance and that of its committees and individual directors.

UK: ICSA publishes new terms of reference guidance for board committees

The Institute of Chartered Secretaries and Administrators has published new guidance on the terms of reference for the audit, risk, nomination and remuneration committees: see here.

UK: ICSA publishes draft guidance - improving board effectiveness

The Institute of Chartered Secretaries and Administrators has published for consultation draft guidance designed to assist boards in their implementation of the UK Corporate Governance Code. Titled Improving Board Effectiveness, the guidance is available here (pdf). It is expected that the final version of the guidance will be submitted to the Financial Reporting Council later this year to replace the existing Higgs guidance.

UK: ICSA review of the Higgs guidance - consultation responses published

Earlier this year the Institute of Chartered Secretaries and Administrators began a review of the Higgs guidance with the publication of a consultation paper titled Improving Board Effectiveness (available here, pdf). The paper set out a suggested framework for new guidance around five areas: [1] roles and responsibilities of the board and its members; [2] skill levels in the boardroom; [3] board decision-making; [4] the individual on the board; and [5] accountability.

The consultation period ended in April and responses have now been published by ICSA: see here. A further consultation paper is expected within the next month or so.

UK: ICSA's board performance evaluation report

The Institute of Chartered Secretaries and Administrators has published a report in which it reviews the manner in which the top 200 listed companies (at the end of 2009) undertook and reported their annual evaluation of the performance of the board, the audit, nomination and remuneration committees and the individual members of the board in line with Principle A6 of the Combined Code: see here (pdf).

According to the report, 16% of companies undertook some form of external board evaluation process. The Financial Reporting Council, in its 2009 report on the Combined Code, stated (para. 3.41):

... the potential benefits resulting from the greater objectivity that an external facilitator can bring to the evaluation process are such that a provision should be added to the Code recommending external facilitation of the board review at least every three years. Those companies that consider this to be unnecessary or undesirable will, of course, continue to be able to choose to explain rather than comply. Those companies that choose to comply will be free to decide what form of external involvement would be most beneficial to them".

UK: GC100 responses - FRC stewardship code consultation and ICSA Higgs review

GC100 - the Association for the General Counsel and Company Secretaries of FTSE100 companies - has published its submissions to the FRC's stewardship code consultation and ICSA's Higgs guidance review: see, respectively, here (pdf) and here (pdf).

UK: ICSA response to FRC stewardship code consultation

The Institute of Chartered Secretaries and Administrators (ICSA) has published its response to the Financial Reporting Council consultation on the stewardship code for institutional investors: see here (pdf). ICSA supports the policy objectives identified by the FRC in its consultation paper (here, pdf) and is, in general, supportive of the principles in the code.

UK: ICSA review of the Higgs guidance - Company Law Committee response

The City of London Law Society Company Law Committee has published its response to ICSA's review of the Higgs guidance: see here (pdf). The Committee agrees with the aim of the review ("to offer guidance which, without being prescriptive, assists boards in understanding and implementing the purpose of the Code and, in so doing, delivers practical advice to boards on how they can apply the Code to enhance their effectiveness").

In section 1.1 of the first consultation paper (here, pdf) published as part of ICSA's review it was stated that the revised guidance would "refer to ethical sensitivity, and the need for the board to take account of ethical issues in setting business strategy and the manner in which business is undertaken". The Committee takes the view that this would not be useful for several reasons including the fact that including material on ethical issues may put at risk the largely uncontroversial nature of the Higgs guidance.

UK: ICSA responds to FRC Combined Code recommendations

The Institute of Chartered Secretaries and Administrators has published its response to the final report and recommendations published by the Financial Reporting Council in respect of its review of the Combined Code: see here (pdf).

ICSA supports in general the draft Code and the approach taken by the FRC but expresses reservations concerning annual election for the board and/or chairman. In this regard, ICSA states in its submission: "our strongly preferred route is to maintain the status quo of triennial elections".

UK: ICSA review of the Higgs Guidance - consultation paper published

The Financial Reporting Council, as part of its recent review of the Combined Code on Corporate Governance, commissioned the Institute of Chartered Secretaries and Administrators to review the Higgs guidance and to consider whether additional guidance was required. As part of its review, ICSA this week published a consultation paper titled Improving Board Effectiveness: see here (pdf).

The paper sets out a suggested framework for new guidance around five areas: [1] roles and responsibilities of the board and its members; [2] skill levels in the boardroom; [3] board decision-making; [4] the individual on the board; and [5] accountability. Responses should be submitted by 16 April. In June, ICSA will publish a further consultation paper with the aim of submitting completed guidance to the FRC in October.

UK: statements of capital under the Companies Act (2006) - BIS consultation

The Department for Business, Innovation and Skills has published a consultation paper concerning the financial information required in statements of capital under the Companies Act (2006). The consultation highlights problems with the current requirements - some of which were highlighted by ICSA earlier this year - and sets out a proposed response involving changes in the Act which BIS believes would simply the information required and avoid the need to disaggregate any information below the level of class of share.

UK: ICSA responds to FRC Combined Code and Walker reviews

The Institute of Chartered Secretaries and Administrators has published its response to the FRC's review of the effectiveness of the Combined Code and Sir David Walker's review of bank governance. Whilst welcoming in broad terms the work of the FRC and Sir David, ICSA makes clear that some of Sir David's recommendations should not be applied to all listed companies. For example, Sir David's seventh recommendation - the chairman should be expected to commit a substantial proportion of his or her time, probably not less than two-thirds, to the business - is described by ICSA as "too prescriptive" to apply to all listed companies.

Note: Sir David will be publishing final recommendations on November 26th.