2009 Review of the Combined Code

On 1 December 2009 published a report on the findings of its review of the impact and effectiveness of the Combined Code. The report also sets out the actions that the FRC proposes to take as a result of the review. The main findings and actions are explained in the ‘Executive Summary’ section of the report.

 Final Report

As a result of this review the FRC is consulting on proposed revisions to the Code. Further details are available in the consultation paper.

 Consultation paper

The consultation closes on 5 March 2010. Comments on the proposals should be sent to codereview@frc.org.uk or in writing to:

Chris Hodge
Corporate Governance Unit
Financial Reporting Council
Fifth Floor
Aldwych House
71-91 Aldwych
London WC2B 4HN

The proposed revisions to the Code include some proposals intended to implement some of the recommendations in the Walker Report on the governance of banks and other financial institutions that the FRC considers should apply to all listed companies. Further details of the actions the FRC will be taking in response to the Walker review can be found at. http://www.frc.org.uk/corporate/walker.cfm

Background

On 18 March 2009 the Financial Reporting Council announced the latest in its series of regular reviews of the impact of the Combined Code on Corporate Governance. A call for evidence was issued inviting views on these questions:

• Which parts of the Code have worked well? Do any of them need further reinforcement?
• Have any parts of the Code inadvertently reduced the effectiveness of the board?
• Are there any aspects of good governance practice not currently addressed by the Code or its related guidance that should be?
• Is the ‘comply or explain’ mechanism operating effectively and, if not, how might its operation be improved?

Further details are available in the consultation paper:

 Review of the effectiveness of the Combined Code: Call for evidence

The consultation closed on 29 May 2009. Copies of the responses to the consultation can be found at: Responses to March consultation on the 2009 Review of the Combined Code 

The FRC has produced summaries of the main points made in these responses, and in a separate series of meetings with the chairmen of UK listed companies held between April and June 2009.

 Summary of Responses: Review of the effectiveness of the Combined Code (July 2009)

 Summary of FTSE Chairs meetings: Review of the effectiveness of the Combined Code (July 2009)

In addition the JCA Group conducted a series of interviews with investors, companies and advisers on behalf of the FRC to obtain their views on the effectiveness of shareholder engagement. A report on their findings can be found here.

On 28 July 2009 the FRC published a progress report on the current review of the Combined Code. The report identifies and invites views on the main issues to emerge from the first phase of the review.

 Progress Report: Review of the effectiveness of the Combined Code (July 2009)

Consultation on the issues raised in the progress report closed on 9 October. Copies of responses to the consultatns can be found at: Responses to July consultation on the 2009 Review of the Combined Code.