Our new guide is an update of our previous document now that issuers have reported against the 2014 UK Corporate Governance Code for the first time.
Our views have not changed – in fact, if anything, they have been reinforced by what we’ve seen. The most successful disclosures, in our view, are those which:
We have also continued to test our thinking (and our suggested illustrative statement) on investor organisations, with very positive results. This document reflects their feedback and some refinement of our own views. In particular we have emphasised and added further comments to our illustrative statement on the importance of:
Overall, we have continued to see a steady upward trend in the quality of the disclosures companies have made. But there are still too many examples of boilerplate statements that could have been cut from one annual report and pasted into another, regardless of the nature of the company or the industry. This might, strictly speaking, be ‘compliant’ but it serves little purpose and completely fails to provide insight into risks to solvency and liquidity.
We hope that, whatever their approach in year one, this update will help companies think afresh about the viability statement in year two.