U.K.’s Financial Reporting Council Seeks Wider Enforcement Powers

The Financial Reporting Council (FRC) has asked for wider powers to investigate and take enforcement action against company directors for financial reporting and governance failures. In its response to the U.K. government’s Corporate Governance green paper, the regulator said its current powers are limited mainly to accountants and actuaries.

The FRC also called for stronger implementation of Section 172 of the UK Companies Act, which requires Directors to promote company success while considering employees, customers, suppliers, environmental impact, and long-term consequences. It said companies should provide clearer disclosures on how these duties are being fulfilled. The regulator proposed extending remuneration committee oversight to pay policies across organisations and linking executive compensation more closely to long-term business performance. It also suggested stricter reporting requirements for shareholder opposition to remuneration resolutions.

Separately, the Financial Conduct Authority (FCA) launched a consultation on changes to U.K. listing rules and primary capital markets regulations.