UK Law and Practice Contributed by: Gareth Sykes, James Palmer, Isobel Hoyle and Hannah Whitney, Herbert Smith Freehills Kramer
The UK government has indicated that it intends to strengthen this reporting obligation, includ - ing by mandating certain content requirements and requiring publication on a government- sponsored website, though the timing for any changes is not known. In the interim, the UK government has published updated guidance for in-scope entities on the requirements of the Modern Slavery Act. 3. Management of the Company 3.1 Bodies or Functions Involved in Governance and Management The principal bodies and functions involved in the governance and management of a company in the UK are set out below. • The board of directors – as discussed in 4.3 Board Composition Requirements/Rec- ommendations , a company is required to appoint directors. The articles of association of the company will typically delegate man - agement of the company to the directors, enabling them to execute all the powers of the company. The composition and activities of a board of directors will vary depending on the company’s circumstances. Publicly listed company boards will include a number of non-executive directors in accordance with the provisions of the Governance Code. For companies which are not listed, the board is usually comprised of executive directors who are involved in the day-to-day management of the business. An unlisted company may appoint non-executive directors to the board, and the Wates Principles encourage large private companies to consider this. • The company secretary – it is a requirement under the Companies Act for a public com - pany to have a company secretary. Private
companies are not required to have a com - pany secretary. The role of the company secretary is to support the board and advise on corporate governance issues. • The executive management team – the responsibility of the executive team is to implement the board’s decisions and policies, and deal with the day-to-day management of the company. In unlisted companies, the executive team will often comprise of the same individuals as the board of directors. In a publicly listed company, the CEO and CFO will usually be directors of the company, with the remaining members of the executive team forming/sitting on an executive committee or equivalent. • Shareholders – the shareholders are the own - ers of the company, and those who hold the board of directors to account. The articles of association and the Companies Act provide that a number of decisions are reserved for shareholders (see 3.2 Decisions Made by Particular Bodies ). 3.2 Decisions Made by Particular Bodies Decision-making by a company is generally delegated to the board of directors in the com - pany’s articles of association (although there are some decisions that are reserved for the share - holders). The key decisions made at each level of the management of a company are as follows. • The board of directors – most decisions are made by the board of directors and will typically relate to the strategy and general management of the company. • The management team – where the manage - ment team is different to the board of direc - tors, it will make decisions on the day-to-day business of the company pursuant to powers delegated by the board of directors.
848 CHAMBERS.COM
Powered by FlippingBook