The Financial Reporting Council (FRC) has welcomed the recommendations of the independent advisory group's report on growing a culture of social impact investing in the UK.
The UK is a global leader in social impact investment. This report highlights opportunities for the FRC to improve public trust in business by promoting greater understanding of the broader social benefits generated by business and investors.
The FRC will shortly consult on changes to the UK Corporate Governance Code, including the need for companies to link corporate governance to purpose, undertake engagement with wider stakeholders, and consider how they benefit wider society.
Broader social impact
This consultation will include questions about the future direction of the UK Stewardship Code, including the extent to which the interests of wider stakeholders, and broader social impact, including environmental, social and governance factors are integrated into engagement and monitoring by investors.
The Strategic Report, supported by the FRC's Guidance, requires companies to report on environmental, employee, social, community and human rights matters.
As part of the FRC’s recent consultation on amendments to the Guidance on the Strategic Report the FRC encouraged companies to consider the impact of their activities on a wider group of stakeholders and those matters that contribute to the long term success of the company.
The FRC are currently reviewing the responses to its consultation and developing guidance which will take into account BEIS’s revision of reporting regulations requiring companies to explain how their directors comply with the requirement of Section 172.