Remote working, social movements, digitalisation and rapidly evolving regulation are reshaping business. This pace of change and disruption makes robust governance frameworks vital.

“Techniques that might have worked even five years ago are already outdated,” says Victoria Geroe, ICAEW Corporate Governance and Stewardship Manager. “Every company now has a responsibility to review its governance frameworks and measure whether they still work.”

For chartered accountants, that means moving beyond compliance checks and asking: does this code of governance still fit how the business operates today?

“Too often, governance risks becoming a tick-box exercise,” Geroe says. “The documents are there, the policies are written, but unless they actually lead to effective decision-making, it’s just lip service.”

The weight of Provision 29

Boards will soon face a new duty. Effective from January 2026, the updated UK Corporate Governance Code introduces revisions to Provision 29, which requires directors to make a public declaration on the effectiveness of their internal controls and risk management frameworks.

This will tighten the board’s responsibility regarding their governance structures. “It’s going to force boards to think more deeply than before,” Geroe says. “If you sign that statement and something later goes wrong, the reputational hit is enormous. Investors will immediately question whether you really tested your controls.”

The Financial Reporting Council (FRC) publishes annual compliance reports. No board wants to be named as a poor example. “It’s not only about regulatory scrutiny. It’s about investor confidence and public trust.”

Comply or explain – and mean it

The UK’s governance model remains principles-based, built on the comply or explain approach. In practice, that means companies are not forced into blanket compliance. They can instead publish an explanation of why a certain provision does not suit them.

As the FRC CEO Richard Moriarty recently told an ICAEW audience, the regulator wants companies to take more risks, saying the system is not “comply or else”. The crucial point is that explanations must be transparent and comprehensive. Boilerplate won’t cut it.

Some high-growth companies, for example, might reasonably explain that certain risk controls are still being developed, while laying out a clear roadmap and timeline. But explanations cannot be open-ended. If boards choose not to comply, they’ll need to justify it again and again. It can’t be an excuse for ignoring governance in the long term.

Value for money

Research suggests that organisations without effective governance may not get value for money. A recent article by Grant Thornton Gibraltar highlighted the financial drag of poor governance structures.

“Good governance is often viewed as a cost or an administrative burden, but in reality, it is an investment in the long-term success and stability of a business. Without it, even the most promising ventures can falter (sometimes irreversibly) under the weight of poor decisions, unchecked risks, or behaviour that goes unchallenged,” according to the Grant Thornton article.

For accountants, the lesson is to quantify governance in business terms. Weak frameworks bring inefficiencies, increase risk exposure and reduce investor confidence. Strong frameworks protect value and make the organisation more attractive to capital.

“Investors like certainty,” Geroe says. “If companies can deviate from the Code whenever they want, that doesn’t help confidence in the UK market. The balance is to allow flexibility without eroding trust.”

The rise of the company secretary

Another shift is the changing role of the company secretary. Once seen as an administrative clerk, today’s company secretary is increasingly a strategic partner.

“Boards now rely on their company secretaries to horizon scan,” Geroe says. “They’re the ones who stay on top of emerging regulations, whether that’s sustainability disclosures, AI oversight, or ESG. They make sure compliance remains a focus without stifling growth.”

Failing to use the company secretary effectively leaves boards blind to upcoming regulatory and reputational risks, advisers warn.

Strengthening governance

Corporate governance experts from across this series point to several practical steps accountants can champion to help boards strengthen governance:

• Measure effectiveness: don’t just ask if controls exist, ask whether they work. Track decision quality and risk outcomes.
• Align with strategy: governance isn’t about slowing growth – the framework should support long-term value creation.
• Use explanations well: if you don’t comply, be transparent, time-bound and clear about when you will.
• Empower governance partners: company secretaries, internal auditors and non-executives must be treated as early-warning systems, not back-office support.
• Stress-test controls: regular scenarios and simulations provide evidence for the new Provision 29 declarations.
• Communicate openly: providing transparent updates to investors on governance issues builds confidence, even when challenges exist.

The underlying theme is the balance between compliance and flexibility, governance and growth, and principles and investor confidence.

For accountants, the message is clear. Strong governance is no longer just about compliance. It is about helping boards make better decisions, manage risks intelligently and build resilience in an uncertain world.