The Financial Reporting Council (“FRC”) has recently published its response to a consultation on gender diversity on UK boards and concluded that two changes should be made to the UK Corporate Governance Code (“Code”) (the key source of corporate governance recommendations for companies with a premium London listing) with effect from 1 October 2012.

Background

The Code came into force in June 2010 and for the first time introduced the principle that the benefits of diversity (including gender) should be considered when searching for board candidates.

Following the introduction of the Code, Lord Davies of Abersoch was tasked with undertaking a review of gender equality on boards. The results of this were published in February this year in a paper entitled ‘Women on Boards’. The paper made a number of recommendations, for example, that quoted companies should disclose annually the proportion of women on the board and that all Chairmen of FTSE 350 companies should set out the percentage of women they aim to have on their boards in 2013 and 2015 (for further information see our previous update).