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The UK Corporate Governance Code and Irish Stock Exchange Annex
(known…
The UK Corporate Governance Code and Irish Stock Exchange Annex
(known as ‘The Combined Code on Corporate Governance’)
The aim: to provide a set of principles that ensure the company directors take responsibility for their actions and provide sufficient disclosure at regular intervals on the financial status of their company.
Mainly used by companies quoted on the UK stock exchange, but many Irish companies, both private and public, elect to adhere to these rules.
Principles
Accountability
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The board should establish arrangements for maintaining an appropriate relationship with the company’s auditor
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Remuneration
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Levels of remuneration should be sufficient to attract, retain and motivate directors of an appropriate quality to run the company successfully, but the company should avoid paying more than necessary.
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Effectiveness
There should be a formal, transparent procedure for the appointment of new directors to the board.
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The board and its committees should have the skills, experience and independence and knowledge to enable them to discharge their duties effectively.
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Leadership
Clear division of responsibilities between running of the board and the executive responsibility for the running of the company’s business.
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Listed companies are expected to comply with the Code, although they are not legally mandated to do so.
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If a company wishes to depart from any of the provisions of the Code, they must give an explanation in their annual report as to why they are not complying with the code (‘comply or explain’ principle).