The FRC has this week published a
consultation on the content, operation and oversight of a stewardship code that will set out good practice for institutional investors when engaging with the UK listed companies in which they invest.
The FRC agreed to take on responsibility of oversight of the proposed code at the request of the Government, following Sir David Walker’s report on the corporate governance of banks and other financial institutions in November 2009.
The FRC is seeking views on:
Whether the code published by the Institutional Shareholders’ Committee in November 2009 provides a suitable basis for the Stewardship Code, in either its existing or an amended form;
What the responsibilities for engagement of institutional shareholders and their agents are to the beneficial owners whose money they manage;
How adoption of the standards in the code by UK and foreign investors can be encouraged;
What information investors should disclose on their engagement policy and practice; and
What arrangements should be put in place to monitor how the code is applied.
Consultation ends on 16 April 2010 and the outcome of the consultation will be announced in May or June.