“We welcome that the FRC’s revised Corporate Governance Code places a greater emphasis on the relationship that the business has with its employees. The new Code requires boards to focus much more on providing opportunities for employee voice and ensuring workforce policies and practices are consistent with the company’s values and support its long-term success. The workforce is fundamental to any businesses success but all too often, its voice is not heard at the top levels of organisations. The updated Code is a step in the right direction for ensuring that employee opinions are taken into account on the issues that matter most.
“It’s also encouraging to see the updated Code place increased emphasis on organisations’ culture and how they preserve value over the long-term. We welcome the fact that in future, companies will be required to set out much more clearly in the annual report how they assess and monitor their culture and the actions they are taking to address problems where practices or behaviours don’t align to their stated values.
“The singular focus on short-term gains for financial stakeholders that has guided so many businesses in the past keeps on creating problems for organisations around trust and stability. We see this through inexplicably high pay-outs for some FTSE 100 CEOs and through numerous corporate scandals that are created in the rush for financial gain. We hope that the new Code goes some way towards instilling better behaviours in business and better outcomes for all stakeholders.”
