The Walker Review

Sir David Walker’s report on the governance of banks and other financial institutions was published in November 2009. The report can be found at:

Walker Review of Corporate Governance of UK Banking Industry

The FRC’s statement welcoming the Walker Report can be found at: http://www.frc.org.uk/press/pub2174.html. The FRC agreed to implement those recommendations that it considers should apply to all listed companies. Further details were set out in the FRC’s report on its own review of the Combined Code that concluded in December 2009. Copies of the report can be found at: http://www.frc.org.uk/corporate/reviewCombined.cfm.

Some of the recommendations have been implemented through revisions to the Code (now renamed the UK Corporate Governance Code). The Code will apply to financial years beginning on or after 29 June 2010. Some recommendations will be implemented through revisions to other FRC guidance, such as the Turnbull Guidance on internal control and “Good Practice Suggestions from the Higgs Report” (the Higgs Guidance). The Code and Guidance can be found at: http://www.frc.org.uk/corporate/ukcgcode.cfm

The FRC has asked the Institute of Chartered Secretaries and Administrators (ICSA) to undertake an exercise to update the Higgs Guidance on its behalf. ICSA has formed a steering group to oversee this exercise.

ICSA began consultation on draft updated guidance in July 2010. A link to the consultation document, can be found in the attached press notice. Consultation closes on 14 October 2010.

Sir David Walker also recommended that the FRC’s remit should be extended to cover the development and encouragement of adherence by institutional investors to best practice in stewardship of UK listed companies. The FRC has agreed to the Government’s request that it should take responsibility for a stewardship code for institutional investors. A consultation document on this subject was issued on 19 January 2010. Further details can be found at: http://www.frc.org.uk/corporate/investorgovernance.cfm

Sir David also asked that the FRC website provide a link to the website of the new Remuneration Consultants Group, which has published a code of conduct for remuneration consultants. Further details of the Group and code of conduct are available at:

Remuneration Consultants Group

Other recommendations in the Walker Report will be implemented by the FSA. The FSA issued a consultation paper on governance and approved persons in January 2010. The consultation paper can be found at: http://www.fsa.gov.uk/pages/Library/Policy/CP/2010/10_03.shtml.