FRC outlines new governance standards

Those with private wealth invested in listed companies could get more power over its operations as a result of new governance standards issued by the Financial Reporting Council (FRC).

Among the changes to the existing code is the need for all directors of firms inside the FTSE 350 to be re-elected annually in order to increase accountability to shareholders, as well as regular development reviews being held by chairmen to help boost board performance.

The new edition of the regulations is due to be introduced at the end of next month and chairman of the FRC Baroness Hogg said the alterations ’are designed to reinforce board quality, focus on risk and accountability to shareholders’.

However, the Association of Investment Companies has disagreed with the changes, with director general Ian Sayers stating ’investors already have enough power’ in terms of voting on board members.

Mr Sayers added is it ’essential’ governance of standards at firms is conducted in an ’intelligent manner’.ADNFCR-2318-ID-19806928-ADNFCR