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The Association of International Certified Professional Accountants welcomes new FRC Corporate Governance Code

The new Code contains positive enhancements on culture and diversity but underplays the significance of business models for good corporate governance and board decision making.

The Association welcomes the launch of the new FRC Corporate Governance Code, in particular its focus on long term and sustainable business success. 

Building on the positive impact of the Code to-date, the Association is pleased to see further efforts to address trust in business through greater attention paid to ensuring the right company culture and diversity of board experience and skills.

However, the Association would have liked to have seen more emphasis placed on understanding business models, given they are instrumental in creating long term value and trust. The Association also remains concerned that too much weight has been placed on engaging the workforce at the expense of other stakeholders.

Andrew Harding FCMA, CGMA, Chief Executive – Management Accounting – at the Association of International Certified Professional Accountants commented:  

“We welcome the changes in the new Code but believe more prominence should have been given to understanding and developing resilient business models as the driver of value. Business model understanding is critical to decision-making and can help avoid the serious strategic missteps that lead to corporate failures. As the new Code is embedded into the business environment, we should not lose sight of the need to better apply business model understanding to risks and opportunities”.