Industry update

Following the UK Chancellor’s recent Mansion House speech, HM Treasury have published a document entitled ‘A new chapter for financial services’ that lays down, in broad terms, some of the measures the UK government plans to take on a range of matters to help the UK financial services sector evolve and thrive.

The plans are split into four key areas:

  • An open and global financial hub
    The government have attempted to achieve this through their partnership with Singapore, the work with the US on the Financial Regulatory Working Group, granting packages of equivalence decisions across regulations for EEA countries and legislation to meet G20 commitments. They plan further measures which will include delivering an agreement with Switzerland and promoting high international standards on financial stability, innovation, and sustainability. Looking forward, HMT are looking to make further equivalence assessments and decisions in relation to other jurisdictions and increase relationships with large emerging markets including China, Brazil, and India.

  • A sector at the forefront of technology and innovation
    HM Government continue to focus on cementing the UK’s reputation as global hub for fintech by responding to the recommendations of the Kalifa Review (which looked at the UK FinTech industry). As a result, the government has started to assess the case for a new form of money (we await with interest what this will be) and have established the Bank of International Settlements UK Innovation Hub. There are plans to develop a new sandbox to promote technological change for financial market infrastructures. HMG is keen to harness new technologies such as cryptoassets and stablecoins, while protecting access to cash through legislation. This is reflected in a long-term vision for UK payments networks.

  • A world-leader in green finance
    The government have committed to making disclosures aligned with the Taskforce on Climate-Related Financial Disclosures (“TCFD”) mandatory by 2025 – with most in place by 2023 (for more information see the below item and see our item on Corporate Reporting in the April Registry Round-up). The Green Financing Framework sets out how ‘Green Gilts’ will finance those projects designed to tackle climate change.

    The financial services sector will be asked to commit to net zero emissions, combat greenwashing, and improve disclosures on how they manage risks – and opportunities in line with commitments made on climate change. These disclosures will improve the ability of Investors to judge the environmental impacts of their investments.

  • A competitive marketplace promoting effective use of capital
    To date, the government have taken the first steps in amending the country’s regulatory regime since leaving the EU by introducing the Financial Services Act 2021. They commissioned Lord Hill’s review on the listing regime and accepted all the recommendations.
    Further plans include a further regulatory framework review with a consultation due in the autumn of 2021. They intend to consult on reforms to the prospectus regime, the capital markets regime, and the prudential regulatory regime for insurance firms.

CPU’s View

We welcome the government’s plans for the future of the financial services sector which will, as we have seen from Lord Hill’s review, affect the equity markets. But the government have continued to be silent on the introduction of dematerialisation, having taken the active decision to remove such requirements from their onshoring of the Central Securities Depositary Regulation. As Ireland begin the work to introduce dematerialisation along the lines of the published industry model that was devised in 2014 by issuers, registrars and other market participants, the UK stands still. And without action, the UK will become one of a very few markets in the world without a fully dematerialised market structure. The optics are difficult to reconcile.

As one of Computershare’s final acts as Chair of the Registrars Group, we ramped up the lobbying efforts that have been ongoing with BEIS and HMT by expressing our concerns directly to the Secretary of State, believing that full-market dematerialisation, achieved in an appropriate way, has the potential to delivery long-term benefits to all market participants including issuers and investors.

The Quoted Companies Alliance (QCA) have published a practical guide to aid companies in assessing and enhancing their approach to board performance reviews. It looks improve the engagement with, and outputs from board assessments, and establish a board culture designed around continuous improvement.

The guidance is based on research conducted by Henley Business School for the QCA which looked at how growth companies are conducting reviews, what variations may exist based on company size or stage of development, and what good practice looks like.

The guidance is free for QCA members or available to buy for non-members.

CPU’s View

This follows on from the recent consultation and recommendations from the ICSA “Review of the effectiveness of independent board evaluation in the UK listed sector” which sets out a series of recommendations for boards and providers.

There is no debate that for a board to be effective, they must continually monitor and improve their performance. Regular Board Performance Reviews help inform and influence succession planning by identify strengths and highlight areas for further improvement. They are a vital tool for well-rounded and diverse boards. We welcome this guidance as part of the continuing move to shift the perception of board reviews as a compliance obligation which result in generic ‘boilerplate’ evaluation reporting to a constructive exercise that delivers greater accountability to shareholders and wider stakeholder groups.

The Financial Conduct Authority have published a consultation considering their proposals to require standard listed companies to make further climate related financial disclosures.

Following the introduction of Listing Rule 9.8.6(8) that requires listed companies to report on climate related matters in line with the TCFD recommendations that came into force for financial years starting on or after 1 January 2021, this consultation looks to expand the requirement even further. For accounting periods beginning on or after 1 January 2022, companies would be required to provide a statement in their annual financial report that sets out whether their disclosures are consistent with the TCFD recommendations.

The consultation is seeking feedback on whether and how to extend the existing requirements for equity securities, debt securities and Global Depository Receipts. At the same time the FCA is seeking views on ESG integration in UK capital markets as it looks to generate discussion and engage stakeholders.

The consultation closes on 10 September with the FCA aiming to publish the final rules by the end of 2021.

CPU’s View

It is an undeniable fact that climate change is one of the greatest threats to people and our planet. The financial risk that climate change poses to the global economy is ever-growing. Shareholders and wider stakeholder groups, including financial markets, need transparency from companies through clear and comprehensive disclosures on climate-related risk and opportunities. Computershare welcomes a more sustainable future and eagerly anticipate the publication of the final rules on the standardisation of this type of reporting.


In one of the FCA’s latest Primary Market Bulletins, the Authority announced a consultation on a guidance note regarding the adoption of the ESMA guidelines on disclosures in relation to the Prospectus Regulation.

While the final report on the guidelines were reported by ESMA in July 2020, they didn’t come into force until the end of the Brexit transition period and so were not folded into UK law. However, the FCA have been clear that issuers need to continue to have regard for the recommendations.

Now the FCA is proposing to create a new technical note to adapt the ESMA guidelines as FCA guidance.

The consultation closes on the 4 August.


An updated edition of the Guernsey’s Financial Services Commission Corporate Governance Code has been released and will apply to financial years starting on or after 1 October 2021. It has been amended to include a new rule concerning climate change (Rule 5.2.1) which requires a board to consider the impact of climate change on the organisation’s strategy and risk profile and where appropriate make timely related disclosures.


The Financial Conduct Authority have issued a consultation on a series of proposed reforms that have stemmed from the recent review conducted by Lord Hill on the listing regime.

The consultation looks to introduce reforms to improve the effectiveness of UK primary markets, and also a discussion of how it might continue to develop the regime to ensure that the UK remains competitive.

The FCA will be consulting on:

  • Allowing a targeted form of dual class share structures to encourage innovative, founder-led companies into listing on public markets sooner;
  • Reducing the amount of shares an issuer is required to have in public hands from 25% to 10% so as to reduce potential barriers for issuers; and
  • Making minor changes to the Listing Rules, Disclosure Guidance & Transparency Rules and the Prospectus Regulation Rules so as to simplify the rulebooks, reflect changes in technology and market practices.
  • The consultation also includes a discussion which seeks views on the overall structure of the listing regime and if wider reaching reforms could help to improve longer-term effectiveness.

The consultation will last for 10 weeks ending on the 14 September 2021 and subject to the feedback of the consultation it is anticipated that relevant rules will be introduced before the end of 2021.

Corporate Governance Factbook

The OECD have released their 2021 edition of the Corporate Governance Factbook. The book looks at four areas of governance across 50 jurisdictions.

The factbook provides information on the institutional, legal and regulatory frameworks worldwide and breaks it down in to the global market and corporate ownership landscape (chapter one), the corporate governance and institutional framework (chapter two), the rights of shareholders and key ownership functions (chapter three) and the corporate board of directors (chapter four).

Companies will need to consider the impact the Corporate Governance Factbook may have on their global entities and reporting. Our Company Secretarial team would be happy to discuss this further, including best practice.


Georgeson market update

Georgeson is a leading Corporate Governance advisory and Shareholder Engagement company, and part of the Computershare group

Our original research on the ESG policies and practices of 400 of the largest global institutional asset managers and owners across 29 countries found that out of the hundreds of ESG data products available, large institutional investors tend to focus on only 39 providers. Similarly, with respect to reporting frameworks, our research identified five primary investor-favoured organisations, which narrows further still based on geography.

To learn more about top investors’ data usage practices, ESG integration approach and disclosure expectations, and how to streamline your approach to ESG, download our latest white paper here.


Bloomberg reports that Shareholder Activism Campaigns Rebound Out of Pandemic.

“Shareholder activists, fresh from stepping up their campaigns by a third in the first half of the year, are expected to be emboldened by an economic rebound for the rest of 2021. The total number of activist campaigns launched through June 21 at companies with a market value of more than $1 billion reached 116, up from 87 over the same period in 2020 and 115 in 2019, according to data compiled by Bloomberg. The first six months of the year marked a rebound in activism generally as the economy started to recover from the pandemic. Advisers expect that momentum to continue into the second half of the year and into 2022 and beyond. This year’s proxy season will largely be remembered for the unexpected victory of first-time activist Engine No. 1 over Exxon Mobil Corp. and the lift it gave to activist investors focused on environmental, social and governance issues. The little-known fund managed to win three seats on the board of the oil and gas giant despite owning only a 0.02% stake. It’s something other companies will need to take heed of heading into next proxy season, said David Rosewater, Morgan Stanley’s global head of shareholder activism and corporate defense. ESG issues are now at the forefront of a lot of campaigns, and front of mind for a lot of investors, he said.”


Reuters reports that New global sustainability disclosure board draws heavyweight backing.

“Former European Central Bank President Jean-Claude Trichet will head an advisory group on setting up a global board for sustainability-related company disclosures, the IFRS Foundation said on Monday. The new International Sustainability Standards Board (ISSB), due to be unveiled ahead of the COP26 U.N. climate change conference in Glasgow in November, aims to replace a patchwork of voluntary guidance with a single set of global norms for firms reporting the impact of climate change on their business. The IFRS Foundation already oversees the International Accounting Standards Board, which writes accounting rules used in over 140 countries, and the SSB would be a parallel board.”