In late 2017, Sir James Wates CBE was invited by the UK government to lead the development of corporate governance principles for large & medium private companies and groups.
The resulting code – now known as the Wates Principles – was launched in December 2018, and provides a framework to help companies meet legal requirements while promoting long-term success.
Since 2019, all private companies have been obliged by law to include the Wates Principles in their financial reporting and Annual Reviews, to demonstrate how they have adopted these Corporate Governance best practices.
In a further update, the FRC* Wates Principles Whitepaper & Infographic Design(Financial Reporting Council) is demanding that UK firms demonstrably incorporate the Wates Principles by a deadline of June 2024.
*The FRC is the UK body which regulates auditors, accountants and actuaries, and sets the UK’s Corporate Governance and Stewardship Codes. The FRC promotes transparency and integrity in business.
An effective board develops and promotes the purpose of a company, and ensures that its values, strategy and culture align with that purpose.
Effective board composition requires an effective chair and a balance of skills, backgrounds, experience and knowledge, with individual directors having sufficient capacity to make a valuable contribution.
The board and individual directors should have a clear understanding of their accountability and responsibilities. The board’s policies and procedures should support effective decision-making and independent challenge.
A board should promote the long-term sustainable success of the company by identifying opportunities to create and preserve value, and establishing oversight for the identification and mitigation of risks.
A board should promote executive remuneration structures aligned to the long-term sustainable success of a company, taking into account pay and conditions elsewhere in the company.
Directors should foster effective stakeholder relationships aligned to the company’s purpose. The board is responsible for overseeing meaningful engagement with employees, and respect their views when making decisions.
The Government-mandated Wates principles were developed in response to a series of well-publicised governance controversies involving private companies, including the collapse of BHS.
Private UK companies and groups clearly have a great deal to do if they are to – as they will be obliged to do by 2024 – successfully implement the Wates and meet new reporting challenges.
A recent analysis of the category of companies obliged to adopt the Wates Principles which fall into the category also took in into account additional disclosures about boardroom diversity and remuneration:
Just have a google for ‘culture engagement tools’ and you’ll see the vast array of options on the market purporting to help companies adopt the Wates Principles.
No tool, however, can match the Tribe365 app in terms of a standalone plug-and-play solution which supports organisations as they take their culture framework compliance journey and adopt the Wates Principles.
Furthermore, the Tribe365 app has been created to help organisations and their teams maximise performance and productivity.
The Tribe365 app is available at £4 per team member per month, and can be initiated at the flick of a switch. Start the journey now and avoid any compliance pain later!
Speak to us today to start the journey towards happier and higher performing teams