FRC’s corporate governance reporting review finds room for improvement

Companies continue to improve their reporting against the U.K.’s Corporate Governance Code, but the lack of detail about the outcomes and impacts of governance policies hampers proper understanding of how risks are being managed.

The Financial Reporting Council’s (FRC) annual review of corporate governance reporting, published Thursday, finds that while reporting has improved year on year, there are “few companies whose disclosures meet the highest standards.”

The FRC found while companies are moving toward greater transparency and more disclosure—particularly in terms of departure from the code—there is little meaningful explanation about why they have chosen to explain rather than comply.