Annual Report and Accounts 2016
According to the Financial Reporting Council (FRC), corporate governance is about what the board of a company does and how it sets the values of the company and hence, is to be distinguished from the day to day operational management of the company by full time executives.
The revised UK Corporate Governance Code (now referred to as the Code in the currently applicable version) applies to accounting periods beginning on or after 1 October 2014. The Code consists of principles and provisions with the flexibility of a "comply or explain" discretionary approach. It has been enduring and is widely accepted as a guide based on the underlying principles of accountability, transparency, probity and focus on the sustainable success of an entity over the longer term.
Two principal conclusions drawn by the FRC in its review leading to the Code were that more attention had to be paid to following the spirit of the Code as well as its letter and secondly, that the impact of stakeholders in monitoring the Code should be enhanced by better interaction between the Board and its stakeholders.
The Code sets out standards of good practice under the main criteria of Board leadership and effectiveness, remuneration, accountability and relations with stakeholders.
Although the CBI is not a publicly listed company it does where appropriate try to meet the principles of the Code on a comply or explain basis. In 2016 there have been, and are planned, a number of actions to improve CBI compliance with the Code:
The Board met formally four times in 2016 and the attendance is as follow: