The Business, Innovation and Skills Select Committee in the House of Commons (Business Committee) has issued a report on its inquiry into the Kay Review of UK Equity Markets and Long-Term Decision Making (Kay review). A year on from its publication, the Business Committee has asked the Government to do more to drive the implementation of the Kay review. The Business Committee recommends, among other points, that the Government:
- brings forward the creation of the Investors' Forum, the finalisation of the Law Commission's work on the definition of fiduciary duty and the requirements for companies to consult with major investors over all board appointments;
- sets a minimum acceptable level of sign-up to the Stewardship Code. The Financial Reporting Council should consult on enhancing the Code to allow investment managers to focus on strategic issues of investee companies; and
- through FCA intervention, establishes the minimum proportion of institutional investors' annual commission that must be used in long-term investment research.
(Source: Third Report of Session: The Kay Review)