The Quoted Companies Alliance (QCA) in the UK has published a review of corporate governance disclosures made by small and mid-sized quoted companies.
The review looked at 100 small and mid-sized quoted companies across a range of sectors and London markets to establish if they met the minimum disclosure requirements set out in the 2013 QCA Corporate Governance Code for Small and Mid-Sized companies.
The review found that while levels of behaviour varied across the differing disclosure requirements, there were some obvious areas of improvement for the majority.
The report contains five "governance reporting tips" as follows:
- Focus on what is important – companies should think about the message they want to convey in their annual report and accounts, and use it as an opportunity to sell their company's story;
- Explain what you do – investors do not necessarily want blind compliance and box-ticking – they want to understand what governance structures and processes you have in place and why;
- Link your company's strategy, governance and risk – everyone accepts that this is difficult to do but it is important to investors that companies try to articulate this clearly;
- Use the reporting cycle to tell a story – write in your company's voice and tone; don't hide bad news; and deliver your company's messages in a clear and confident manner; and
- Board evaluation can help your company improve its governance – board evaluation and disclosures on this can help demonstrate to investors a process of continuous improvement.