New transparency over resilience and assurance for big business
A factual overview of new draft regulations that will require very large companies to report more effectively on business resilience and assurance.
Documents
Details
The government withdrew these draft regulations on 16 October 2023. This press release explains why the legislation was withdrawn.
The draft Companies (Strategic Report and Directors’ Report) (Amendment) Regulations were laid in Parliament on 19 July 2023. They are subject to debate and approval by the House of Commons and the House of Lords. If approved, they will come into force from the start of 2025.
They will require very large companies (with at least 750 employees and an annual turnover of £750 million or more) to:
- explain how they are managing significant risks, and building or maintaining resilience
- demonstrate that they have enough realised profits to pay any dividend (or make any other distribution of profit), and explain the company’s approach to making dividends and other profit distributions over the short and medium term
- describe the actions taken by the directors to prevent or detect major fraud
- explain how the company assures the quality and reliability of its corporate reporting
Follow the link above for an overview of the draft regulations, including explanations of the 4 new reporting measures.
The new measures respond to lessons learned from major and sudden corporate collapses in recent years, including that of Carillion. They form part of the government’s wider audit and corporate governance reform plans, as consulted on through the March 2021 White Paper on ‘Restoring Trust in Audit and Corporate Governance’ and finalised in the Government’s May 2022 response to that White Paper consultation.
Last updated 20 October 2023 + show all updates
-
The government withdrew these draft regulations on 16 October 2023. Link of press release explaining why the legislation was withdrawn added to page.
-
First published.