As part of our Year of Corporate Governance, we held our Corporate Governance Forum on 12 June 2018 at Haberdashers' Hall in central London, with over 80 small and mid-size quoted company directors in attendance.
Following the publication of the revised QCA Corporate Governance Code, the forum was particularly timely for small and mid-size quoted companies wishing to adopt good governance practices and comply with the recent changes to the AIM Rules for Companies – which will require all quoted companies to state which recognised corporate governance code they follow – coming into effect on 28 September 2018.
Please see below highlights from our keynote speaker, Jessica Ground.
Jessica Ground: Keynote Speaker
We were delighted to welcome Jessica Ground, Global Head of Stewardship at Schroders, as the Forum’s keynote speaker.
She began by providing a brief overview of the QCA Corporate Governance Code’s ten principles.
Jessica advised small and mid-size quoted companies to:
- Never allow corporate governance to become a box ticking exercise.
- Ensure that boards are working with their executive teams to show shareholders that they are taking genuinely long-term decisions in the interests of all their relevant stakeholders.
- Note that, with regards to remuneration, many shareholders become sceptical if companies are unwilling to set targets for their executives which do not exceed one year: why would investors invest in the long-term, if the executive team are not?
- Take into account the fact that governments are increasingly taking measures to respond to societal concerns about how companies conduct themselves. Companies should therefore ensure that they consider a wide range of stakeholder interests, with a focus on how this could impact on their future long-term success.
- Remember that non-executive directors can often be the most cost-efficient consultants that your company can acquire, and are a great way of increasing a company’s capacity.
- Acknowledge the importance and value of board diversity in all its forms. A range of studies indicate that more diverse boards make better decisions which in turn enhance a company’s performance. Small and mid-size quoted companies willing to import the broadest range of skills and experience into their boards will therefore reap the benefits.
- With regards to succession planning, companies should begin preparations on the first day of a new chief executive’s (or a chief financial officer’s) tenure. This will ensure that an efficient and emotion-free process is established.
For more from the QCA Corporate Governance Forum 2018, see also:
- Highlights from the first panel session on the QCA Code in context: principles, disclosures and adoptions
- Highlights from the second panel session on how different users judge a company’s corporate governance behaviour