Relations with shareholders

Effective engagement between a company and its shareholders is viewed as an increasingly important aspect of corporate governance. It is thought to help improve long-term returns to shareholders and result in the efficient exercise of a company’s responsibilities.

A company with a listing of equity shares in the equity shares (commercial companies) category should have regard to the principles and provisions of the UK Corporate Governance Code (UKCG Code) concerning relations with its shareholders. Its shareholders may also wish to consider the principles of the UK Stewardship Code.

The UKCG Code and the UK Stewardship Code are each administered by the Financial Reporting Council (FRC). Their principles and provisions are supported by best practice guidelines, some published by the FRC itself and some by independent bodies, such as the Chartered Governance Institute (CGI).

For a detailed consideration of the regulation of, and guidance on, relations between companies listed in the commercial companies category and their shareholders, see Practice Note: Engagement with shareholders.

UKCG Code and FRC guidance on board effectiveness

The UKCG Code applies to companies listed in the commercial companies category whether in the UK or overseas.

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