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FRC consultation on UK Stewardship Code definition criticised as weakening environmental and social references; industry split over shift to ‘sustainability’ and financial materiality

Published on: 24 February 2025

Published by a Law360 reporter
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Hymans Robertson LLP

In a response dated 20 February 2025 to the FRC’s consultation on proposed updates to the UK Stewardship Code, Hymans Robertson LLP warned that the planned definition could be weakened. The FRC had stated in November 2024 that its refreshed, strengthened definition continues to stress the creation of long-term sustainable value for clients through effective stewardship. This definition sits within a broader suite of suggested amendments to the voluntary code, first set up in 2010 to boost transparency across investments.

Chris O'Bryen, investment associate consultant at Hymans Robertson, stated the proposed change risks undermining the Stewardship Code. He argued that taking out the wording diminishes the definition by removing an explicit nod to the environmental and social impacts businesses may have, as well as the scope for asset owners to foster positive, real-world results via stewardship activity...

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