The following Corporate practice note provides comprehensive and up to date legal information covering:
This Practice Note outlines the regulatory framework for remuneration of directors of quoted and unquoted traded companies against the current backdrop of increased shareholder activism and media attention on executive pay packages. It summarises the statutory directors' remuneration reporting regime for quoted companies and unquoted traded companies and notes relevant provisions of the Companies Act 2006 (CA 2006), Listing Rules, the UK Corporate Governance Code (UKCG Code) of the Financial Reporting Council (FRC) and best practice guidelines relating to executive remuneration.
The Companies, Limited Liability Partnerships and Partnerships (Amendment etc) (EU Exit) Regulations 2019, SI 2019/348 and the Accounts and Reports (Amendment) (EU Exit) Regulations 2019, SI 2019/145 amended the various definitions contained in the CA 2006 for a ‘traded company’ with effect from 11pm (GMT) on 31 December 2020 (IP completion day). For the purposes of this Practice Note, the main impact of these changes relate to:
CA 2006, ss 226A-226F (restrictions relating to remuneration or loss of office payments that are not consistent with the directors’ remuneration policy)
CA 2006, s 420 (duty to prepare a directors’ remuneration report)
CA 2006, ss 439–440 (quoted and traded companies: members’ approval of directors’ remuneration report and remuneration policy)
These provisions apply to quoted companies and from 10 June 2019 to unquoted traded companies. Before IP completion day, the expression ‘traded
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