May 26, 2020

Revised QCA Code 2018

On 25 April 2018 the Quoted Companies Alliance published a revised version of its 2013 corporate governance code.

Key changes from the 2013 version include:

  • The principles have been redrafted so there are now 10, rather than 12.

  • A new principle has been added requiring companies to promote a corporate culture that is based on sound ethical values and behaviours.

  • The principles and the necessary disclosure sections have been merged so that the necessary disclosures now appear underneath the relevant principle.

  • The section on the effective application of the QCA Code has been substantially expanded and redrafted and now appears towards the beginning of the Code.

  • A new description of how a board is typically composed, how it works and the key challenges it faces regarding directors’ independence has been added.

  • The section on the effectiveness of the board and the appendices have been removed. They are now included in a separate document, the Corporate Governance Files. It is intended that these Files will be updated on a rolling basis, and also include a draft board resolution adopting the QCA Code for the purposes of AIM Rule 26.

  • There is less emphasis on the QCA Code being for small and mid-size quoted companies.

  • The new code may be suitable for privately-owned companies that wish to adopt good governance practices.

Interestingly, QCA research indicates that currently over half of the 900+ companies on AIM refer to the QCA Code. There is also, however, a significant minority of AIM companies that currently do not apply any code. The amendments to the AIM Rules in March 2018 will of course require all AIM companies to report against a recognised corporate governance code by 28 September 2018.

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About this Author

Adam Hastings Equity Market Lawyer UK Squire Patton Boggs

Adam is a partner in the Global Corporate Practice, with extensive experience in a variety of international corporate transactional and advisory work, focusing in particular on equity capital markets transactions and private and public companies operating in the mining and oil and gas sectors.

Prior to joining Squire Patton Boggs, Adam spent a number of years as a senior lawyer in the corporate energy and natural resources team of a large global law firm, based in London, and before that in the corporate team of an Australian national firm. His...

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