Financial Reporting Council (FRC) announcement

FRC announces gender diversity changes to be made to the Code for financial years beginning on or after 1 October 2012.

The UK Corporate Governance Code is to be revised following the FRC’s consultation on boardroom gender diversity which closed in July. Lord Davies’ report in February rejected statutory quotas for women on boards but recommended that the FRC should make further amendments to the Code to require listed companies to establish a boardroom diversity policy, including measurable objectives for implementing the policy, and be required to disclose their progress towards meeting those objectives every year.

The FRC consulted on whether:

  • listed companies should establish and report against a boardroom diversity policy
  • changes were necessary to address diversity as part of the board effectiveness
  • the possible contents of a gender diversity policy should be included and
  • the timing of any changes to the Code.

Read the FRC's press release and feedback statement 

It is worth noting that there are other initiatives in this area - the EU, as part of its strategy for equality, is looking for all companies to promise to have at least 30% female board members by 2015 and 40% by 2020. The position will be reviewed in March 2012 to decide whether further action is needed. BIS will also be consulting on recommendations that listed companies should disclose each year the proportion of women on their board, the number of women in the workforce generally and in senior positions.

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