FRC: Boardroom diversity rules strengthened
Companies are now required to report on progress towards boardroom diversity after the FRC changed the UK Corporate Governance Code
STRENGTHENED BOARDROOM diversity rules will require listed companies to report on progress made in changing the traditional boardroom demographic.
Changes to the Financial Reporting Council’s UK Corporate Governance Code build upon the diversity principle first introduced in June 2010.
Chairman Baroness Hogg (pictured) said gender diversity strengthens board effectiveness by reducing the risk of “groupthink”, better exploiting the talent pool and keeping companies in touch with their customers.
“The changes we are announcing today, which were strongly supported in our consultation, will reinforce the code’s principles by requiring companies to report on measurable objectives and progress in this important area. We believe this gives a further opportunity to show that Britain’s “comply or explain”, code-based approach can deliver a flexible and rapid response and is therefore preferable to detailed legal regulation, and we urge companies to demonstrate this as quickly as possible,” she concluded.