Q&A
Determining applicable rules on corporate governance for UK listed companies depends on what market the shares are listed. Companies may have a premium listing, a standard listing or have shares admitted to trading on AIM.
Rules on corporate governance for UK listed companies are highest for premium listed companies.
Some AIM and standard listed companies may elect to hold themselves to the same or similar standards as premium listed companies.
Externally managed investment companies will often follow the AIC Code of Corporate Governance.
Corporate governance for premium listed companies
Under Rule 9.8.6R(5) and (6) the Listing Rules, all UK premium listed companies are required to comply with (or explain the reasons for non-compliance) with the FRC Corporate Governance Code and report upon that compliance in their annual accounts.
Corporate governance for standard listed companies
A company with a standard listing is not required to comply with the FRC Corporate Governance Code.
However, if the issuer is a UK company then under DTR 7.2 the company is required to include a corporate governance statement in the directors annual report setting out what corporate governance code it has adopted.
Corporate governance for AIM companies
Under AIM Rule 26, AIM companies must provide details on their website of the recognised corporate governance code that the company has decided to apply, how the company complies with that code, and where it departs from it including an explanation of the reasons for doing so.
The information should be reviewed annually and the date it was last reviewed should be included (AIM Rule 26). Many AIM companies adopt the QCA Corporate Governance Code or FRC Corporate Governance Code which premium listed companies are required to comply with (or explain the reasons for non-compliance) under the Listing Rules.
Published – 16/04/21
