Principles and Provisions Flashcards
Relevant principles for financial reporting
Principle M
Principle N
Relevant provision for shareholder engagement
3
41
5 sections of the UK Corp Governance Code 2024
Section 1 (A-E) - Board leadership and company purpose
Section 2 (F-I) - Division of responsibilities
Section 3 (J-L) - Composition, succession and evaluation
Section 4 (M-O) - Audit, risk and internal control
Section 5 (P-R) - Remuneration
Principle J (appointments)
Appointments to the board should be subject to a formal, rigorous and transparent procedure
Appointments should be based on merit and objective criteria
Principle J (diversity)
Board appointments and succession planning should promote diversity of gender and social and ethnic backgrounds aswell as cognitive and personal strengths
Principle J (succession planning)
Effective succession plan should be in place for board and senior management
Principle K (succession planning)
Consideration should be given to the length of service of the board as a whole and membership should be regularly refreshed
What is provision 17?
Nom Co. Lead process for appointments
Orderly succession plan for board and senior management
Section 4 - Audit, risk and internal control, principles?
M N O
M - Board establish formal and transparent policies and procedures. Independent and effectives of audits
N - Board present a fair, balanced and understanding assessment of the companies position and prospects
O - Board establish and maintain effective risk management and internal control framework
When is provision 31 relevant and what is it?
Section 4 - audit, risk and internal control
Viability statement required by listed companies
Taking into account companies current position and principal risks.
Board explain how it has assessed prospect of the company, over what people and why period as appropriate
Provision 3 when relevant?
Shareholder engagement
Chair seek regular engagement with major SH
Understand views on governance and performance
When is provision 41 relevant?
Remuneration committee and shareholder engagement
When is principle K relevant?
Overall composition of board - appropriate balance of skills and experience
Succession planning - consideration given to length of service of board as a whole and membership refreshed regularly
What are the 6 principles of
‘The Wates Corporate Governance Principles for Large Private Companies’?
Principle 1 - Purpose and Leadership
Principle 2 - Board Composition
Principle 3 - Director Responsibilities
Principle 4 - Opportunity and Risk
Principle 5 - Remuneration
Principe 6 - Stakeholder Relationships and Engagement
What is Provision 16 of The Code?
Directors should have access to cosec advice
