The Financial Reporting Council (FRC) has today published new guidance to encourage the boards of listed companies to consider how they can lead their companies most effectively. This new guidance replaces ' Good Practice Suggestions from the Higgs Report' so the Higgs Guidance as it was known has been withdrawn.
The new guidance relates to the sections of the UK Corporate Governance Code that deal with leadership and the effectiveness of the board, and addresses such issues as: the roles of the chairman, senior independent director, other directors and the company secretary; decision-making policies and processes; board composition and succession planning and evaluating the performance of the board and directors.
This new guidance which relates primarily to sections A and B of the UK Corporate Governance Code on the leadership and effectiveness of the board will be a really useful tool for boards and their advisers. It is available from the FRC website.
The great virtue of the guidance is that it is not prescriptive and it does not set out 'the right way' to apply the Code. However, it will stimulate boards to think about how they can carry out their role most effectively and this is a much welcome piece of guidance for boards and those that support them.