2020 MM&K / GECN Global Research
In 2019 MM&K, together with our partners in the GECN Group (Global Governance and Executive Compensation Group) researched the Global Trends in Corporate Governance – investors perspective. The outcomes of this research are present in the Executive Summary (click here to request a copy).
25 global investors were interviewed to understand the key issues for them and to identify upcoming trends in Corporate Governance around the world. Board effectiveness appears to be a key issue for investors from Australia and Asia. To the EU, UK and US investors the ESG (environmental, social, and governance) is the main concern.
The G – Governance is currently one of the most regulated aspects of ESG in the UK. There are two codes published, that companies could adopt:
• 2018 UK Corporate Governance Code (applies to accounting periods beginning on or after 1 January 2019);
• 2018 QCA Corporate Governance Code (update of the 2013 QCA Corporate Governance Code).
The E and S – Environmental and Social aspects are less defined at the moment. The 2020 UK Stewardship Code is addressing the whole ESG issue. However, the 2020 Code does not define Environmental and Social measures, only mentioning the climate change issue.
Based on the interviews conducted, climate change is in the lead for the majority of respondents. Some respondents suggest that there will be no material change unless the relevant metrics are incorporated into pay structures.
However, for companies to successfully tackle the whole of the ESG issue, they will need to defining the E and S aspects beyond climate change – “What does ESG mean for us?”. To help our clients and to find out what is the current practice around the world, we will focus our 2020 Research on the ESG being addressed around the world.
For further information contact Margarita Skripina.