Register to get free articles
Want unlimited access? View Plans
Already have an account? Sign in
The Association of Chartered Certified Accountants has urged the Financial Reporting Council not to row back on UK investor governance commitments on sustainability.
In response to the FRC’s consultation on its Stewardship Code, the accountancy body has questioned whether the proposed revised definition of ‘stewardship’ could be interpreted as a scaling back of intent on sustainability.
While the ACCA said it welcomes the FRC’s move to update important investor governance to enable tailored guidance, it is uneasy with the financial council’s proposed removal of ‘environment’ from the proposed Stewardship definition.
Mike Suffield, director of policy and insights at ACCA, said: “Climate-related disclosures continue to mature globally, shifting from tick-box statements to demonstrable action. This is reflected in recent regulatory developments, such as the International Sustainability Standards Board (ISSB) IFRS S1 and S2.
“In the light of these trends, we are concerned about the message that this proposed change would send to the market.”
ACCA is, however, supportive of the overall proposed updating and backs the FRC’s efforts to bring about a more streamlined approach to reporting, saying that a tailored framework can “equip signatories with a better understanding of stewardship and its purpose”.
Rachael Johnson, head of risk management and corporate governance for policy & insights at ACCA, added: “We want to emphasise the importance of understanding rising expectations of different investors to push company boards about risk oversight and continuous monitoring of it given today’s polycrisis norm.
“We support enhanced transparency on the outcomes of different stewardship relationships, rather than the events themselves. It also is crucial to ensure that both cultural and conduct risks are included given today’s rapid digital transformations.”
