UK: auditors' reports and the Companies Act (2006) - APB guidance

The Auditing Practices Board (APB) has today issued Bulletin 2008/9: Miscellaneous Reports by Auditors Required by the United Kingdom Companies Act 2006. The Bulletin provides guidance on those reports and statements required to be made by a statutory auditor which are not dealt with in earlier APB bulletins. 

Uganda: company law reform

Uganda's Companies Act (1961) is based on UK legislation - the Companies Act (1948) - that has long since been replaced. Several years ago the Uganda Law Reform Commission published a report in which recommendations were made for the reform of Ugandan company law. It now appears - from this report - that Uganda will introduce a new Companies Act in 2009. 

Spain: Unified Good Governance Code available on ECGI website

The European Corporate Governance Institute website now contains a copy (in English) of the Spanish Unified Good Governance Code. The Code adopts the comply or explain approach and makes clear that it is for shareholders to evaluate the explanations provided by companies with regard to their degree of compliance with the Code. 

Interestingly, the Code does not take a position on the desirability of one person occupying the position of chairman and chief executive but, where this takes place, it recommends that:

...an independent director should be empowered to request the calling of board meetings or the inclusion of new business on the agenda; to coordinate and give voice to the concerns of external directors; and to lead the board's evaluation of the Chairman".

UK: The Climate Change Bill and company reporting

[Update (28 November): see here]. Yesterday the Climate Change Bill received its third reading in the House of Commons. The Bill now enters the ping-pong stage before receiving Royal Assent. The Bill contains new provisions concerning companies' reporting of their carbon emissions. New Clause 17, titled "Regulations about reporting by companies", provides:

(1) The Secretary of State must, not later than 6th April 2012— (a) make regulations under section 416(4) of the Companies Act 2006 (c. 46) requiring the directors’ report of a company to contain such information as may be specified in the regulations about emissions of greenhouse gases from activities for which the company is responsible, or (b) lay before Parliament a report explaining why no such regulations have been made.

(2) Subsection (1)(a) is complied with if regulations are made containing provision in relation to companies, and emissions, of a description specified in the regulations.

Additionally, new clause 5 provides:

(1) Any company that is required to produce a business review under section 417 of the Companies Act 2006 (c.46) must have regard to any guidance issued under section 80 of this Act when reporting on greenhouse gas emissions.

(2) The Secretary of State may by order provide that any company that is required to produce a business review that includes information on environment matters (including the impact of the company’s business on the environment) under section 417(5) of the Companies Act (c.46) must include information on greenhouse gas emissions, and in doing so have regard to any guidance issued under section 80 of this Act.

(3) The Secretary of State may by order provide that compliance with guidance issued under Section 80 of this Act will be presumed to constitute compliance with section 417 of the Companies Act 2006 (c.46).

(4) The Secretary of State must make provision under either subsection (2) or subsection (3) before 1st April 2010.

(5) The expiry of the period mentioned in subsection (4) does not affect the power of the Secretary of State to make further provision by order under subsections (2) and (3).

(6) The Secretary of State shall, when setting carbon budget pursuant to section 4 of this Act, lay before Parliament a report on any changes to any guidance issued hereunder which the Secretary of State believes are necessary to promote the achievement of any carbon targets.

(7) Any order under this section is subject to affirmative resolution procedure.

According to Government minister Joan Ruddock MP (Hansard: 28/10/08, col 814), these new provisions:

are designed to reinforce our [the Government's] commitment to the importance of corporate transparency and to taking forward the process as quickly as possible. We will consult publicly next year on the detail of how companies’ carbon emissions should be defined and measured. The outcome of that consultation, which will include close work with individual stakeholder groups, will be reflected in the guidance on measurement of emissions that the Government are required to publish by 1 October 2009".

The provisions have been discussed in the Financial Times newspaper - see here. 

UK: the Bank of England's Financial Stability Report

The Bank of England has today published its Financial Stability Report. The Report provides an overview of the events leading to the crisis in financial markets and the response of the UK authorities (including the Banking Bill, currently before Parliament). Section 6 of the report, titled "the medium term agenda", concludes:

the events of the past year or so clearly highlight the need for a fundamental overhaul of the regulatory safeguards used to mitigate systemic risk within the financial system".