Capital Markets Update – December 2019

Business Meeting 10 Print publication


Welcome to the current edition of Capital Markets Update, the monthly briefing from the Corporate Group at Walker Morris rounding up the previous month’s regulatory developments within the equity capital markets and looking ahead to future developments.

November’s news

Investment Association publishes updated Principles of Remuneration

On 1 November 2019, the Investment Association (IA) published updated Principles of Remuneration which set out investor expectations and best practice for executive remuneration.

BEIS publishes recommendations following collapse of Thomas Cook

On 4 November 2019, the Business, Energy and Industrial Strategy Committee (BEIS) published a Letter to the Business Secretary, Andrea Leadsom, setting out the Committee’s conclusions and recommendations on corporate governance, executive pay and bonuses, and audit reform following the collapse of Thomas Cook.

Proxy guidelines published by Glass Lewis

On 4 November 2019, Glass Lewis published its proxy paper guidelines for the UK.

Capital Markets Union legislative reforms

On 8 November 2019, the Council of the European Union issued a Press Release announcing that it has adopted a number of legislative reforms which form part of the progress towards the Capital Markets Union.

ISS announces 2020 benchmark policies

On 11 November 2019, Institutional Shareholder Services (ISS) issued a Press Release announcing that it had published its benchmark policy updates for 2020. The policy is effective for meetings on or after 1 February 2020.

Hampton-Alexander Review on gender balance published

On 13 November 2019, the Hampton-Alexander Review published its 2019 Report on progress made towards improving gender balance in FTSE 350 companies.

FCA publishes consultation on regulatory fees

On 13 November 2019, the Financial Conduct Authority (FCA) published Consultation Paper 19/30 on its policy proposals for regulatory fees and levies for 2020/21. The consultation closes on 13 January 2020.

IA publishes report on sustainability and responsible investment

On 18 November 2019, the Investment Association (IA) published its Final Report following the consultation into sustainability and responsible investment reporting.

FCA publishes Handbook Notice 71

On 22 November 2019, the FCA published Handbook Notice 71 which covers changes made in October and November 2019 to the FCA Handbook and other material.

IoD announces a manifesto for corporate governance

On 22 November 2019, the Institute of Directors (IoD) published a Manifesto for corporate governance which proposes ten policy initiatives for the next Government. The policy initiatives include establishing an independent Corporate Governance Commission (alongside the new Audit, Reporting and Governance Authority).

FCA publishes Primary Market Bulletin 25

On 27 November 2019, the FCA published Primary Market Bulletin 25, its newsletter for primary market participants in which, amongst other things, it includes a draft best practice note regarding inside information aimed at industry regulators, Government departments and public bodies.

FMLC responds to MAR consultation

On 29 November 2019, the Financial Markets Law Committee (FMLC) published its response to the European Securities and Markets Authority (ESMA)’s consultation into the Market Abuse Regulation (MAR). The response focuses on two issues: amendment of the definition of inside information and whether spot FX contracts should be brought within the scope of MAR.

Looking ahead to December 2019

1 December 2019 – ESMA guidelines on risk factors under the Prospectus Regulation begin to apply.

6 December 2019 – Closing date for the International Corporate Governance Network’s second annual stewardship survey.

9 December 2019 – Senior Managers and Certification Regime apply to all regulated firms authorised under the FSMA 2000.

11 December 2019 – Application date for delegated regulations regarding European social entrepreneurship funds and venture capital funds.

15 December 2019 – Revisions to FRC’s 2016 Ethical and Auditing Standards apply to the audit of financial periods commencing on or after this date.

31 December 2019 – Closing date for applications to the UK Stewardship Code 2012 after which it will be replaced by the UK Stewardship Code 2020.