Yesterday (16 October 2018), the QCA Annual General Meeting took place in London.
You can read the full QCA Annual Review 2018 paper here. It contains:
- Chairman's report
- Chief Executive's report
- Treasurer's report
- Board of directors
- Executive team
- Key achievements
- Directory of members
The Chief Executive's report is shared below:
Tim Ward, Chief Executive, Quoted Companies Alliance
I am delighted to report that the Quoted Companies Alliance is in good shape after a year of hard work. We have seen, for a variety of reasons explained below, an increase in our membership and a stabilisation of our finances. The latter is particularly welcome as costs, for instance premises, have increased over time. Our Treasurer, Paul Watts, explains this further in his report.
At the end of the year our membership stood at 272 firms, of which 178 are quoted companies. This has improved our finances together with an increase in sponsorship relating to our 25th Anniversary and our Year of Corporate Governance. I’d like to thank all those who sponsored the QCA over the last 12 months.
Corporate Governance has been the top subject for the QCA this year. Coinciding with the well-received new addition of our QCA Corporate Governance Code the London Stock Exchange changed their rules to require AIM companies to adopt a recognised corporate governance code. Over 400 companies were already referring to our code and following the rule change in September 2018 we are expecting a significant increase in that number. The increased visibility and activity surrounding this rule change and our publication has helped to increase our membership.
I think it is clear that our Code is recognised as being pragmatic and proportionate and, as a result, it is seen as the go-to choice for growing companies. It has been carefully and patiently developed by a working group of our Corporate Governance Expert Group and I would like to thank each of them for their diligent and very professional approach. They reviewed and drafted the document and took on board the feedback we received from the many external stakeholders that we consulted.
Members receive the QCA Code as part of their membership package. Others have to pay for it. We think this is fair. The UK Corporate Governance Code is paid for by the fees levied by the FRC; nothing comes for free.
As part of our work on the Code we have developed collateral material exclusively for our members as well as a workshop to help users to adopt the code as easily as possible. These have been very well received.
Our work has not been confined to the Code and AIM. We have continued to work on the Prospectus Regulation which affects Main Market companies in particular. We have provided feedback on the FRC’s UK Code consultation and have lobbied, with modest success, for the smaller listed company dispensations to be retained. And we have continued to highlight the damage being done by MiFID II on the availability of investment research on smaller quoted companies.
We are in the dark in the same way as everyone else on Brexit. We have had meetings with the Department for Exiting the EU, including a roundtable discussion involving 15 of our member companies with Philip Rycroft, Permanent Secretary at the Department for Exiting the European Union. This highlighted the need for more certainty over many companies’ non-UK EU workforce and the worries about attracting and retaining this valuable resource.
The FRC Review being undertaken by Sir John Kingman has attracted much attention. We see it as an opportunity to get proportionality on the agenda. There are many strong views about the future structure of the organisation, but we are concentrating on building a proportionate approach into the FRC’s constitution, more small-cap representation and a clear divide between standard setting and enforcement. It will be interesting to see what emerges from this review.
We are still present in Brussels on a regular basis. Legislation that is developing or about to be delivered in the EU is going to affect us in at least the short and medium term. It is essential that, as far as we can, we influence the outcome of this legislation that will affect small and mid-size quoted companies on the Main Market, AIM and NEX Exchange. We do this directly and through EuropeanIssuers, the Brussels based association representing European issuers.
Our events team have been very busy as well. We continue with our longstanding and very successful lunches with fund managers as well as our market maker events. Our Corporate Governance Forum which took place in June was attended by over 80 companies with Jessica Ground, Global Head of Stewardship at Schroders, as our keynote speaker and two panels of distinguished speakers. Our Annual Dinner was very well attended and we are grateful for the support of London Stock Exchange, BoardEx/The Deal, and Winterfloods in making this event such a success.
We are looking to build our membership package and, to this end, we are developing a series of “member-to-member” benefits. Members such as Norman Broadbent, Mattioli Woods, MEIS, Evalu8 are offering the membership discounts on valuable products and services. We encourage you all to look out for them and give the providers and us feedback on this service.
Looking forward, we will be setting “Building Better Boards” as our theme for 2019; this supports our work on corporate governance and is aimed at helping companies develop the practices and behaviours that will drive improved performance. We will continue to work on our tax representations to Government; on fighting MiFID II and its impact on investment research; delivering practical guidance for our members on a wide range of subjects; and delivering relevant technical events, dinners and roundtable discussions.
It leaves me to thank the team at the QCA who work very hard to provide all these things to the membership. Their focus is on ensuring that what we do has clarity, that people are aware of what we do and that everything we do is relevant to the needs of small and mid-size quoted companies. My thanks also go to the members of our seven expert groups who provide so much pro-bono support and professional input to our work; we could not operate at such a high level without them. My final thanks goes to our members for your continued support. We remain a not-for-profit membership organisation that only exists if our members see a benefit. Thank you all.