CORE & Amnesty International UK Joint Submission to the FRC Consultation on Proposed Revisions to the Corporate Governance CodeThursday, March 1st, 2018
CORE and Amnesty International UK have made a joint submission to the Financial Reporting Council (FRC) consultation on proposed revisions to the Corporate Governance Code and Stewardship Code.
Corporate scandals both here and abroad have highlighted the systemic problems with the UK corporate governance model. The recent collapse of Carillion, for instance, illustrated the significant social costs that result from corporations run only in the short-term interests of their shareholders and directors’ pay packets.
The proposed revisions to the Corporate Governance Code take steps in the right direction, but do not go far enough. Our submission argues that company boards must integrate a wider set of considerations into their decision making processes including workers, external stakeholders and the environment. Only then will companies focus on their own long-term success and the benefits they can create for society as a whole.
The submission also addresses:
- The proposals to put workers on boards/ proposed ‘workforce engagement mechanisms’.
- Performance-related pay and the suggested extension of remuneration committee’s powers.
- The need for both the Corporate Governance Code and Stewardship Code to refer to international human rights norms, including the UNGPs and OECD Guidelines for Multinational Enterprises.
- More stringent guidelines for investors on how to carry out their stewardship responsibilities.