DP19/1: Building a regulatory framework for effective stewardship

Open discussion: DP19/1
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This joint discussion paper with the Financial Reporting Council (FRC) is about the importance of effective stewardship. It examines what effective stewardship should look like, what the minimum expectations should be for financial services firms that invest for clients and beneficiaries, the standards the UK should aspire to and how these could be achieved.

Show DP19/1 (PDF)

It is one of two papers published today that propose new measures on how to encourage effective stewardship in the interest of consumers. We are also publishing a consultation paper on regulatory measures to implement the provisions of the amended Shareholder Rights Directive (SRD II) for FCA-regulated life insurers and asset managers, as well as for issuers (of shares) in respect of related party transactions.

We have worked closely with the Department for Business, Energy and Industrial Strategy, Her Majesty’s Treasury, the Department for Work and Pensions and the FRC to develop these papers, which encourage effective stewardship in the interest of consumers. In a separate Consultation Paper, the FRC sets out proposed revisions to its Stewardship Code which aim to consolidate and maintain the UK’s strong reputation on stewardship internationally.

Who this applies to

This DP is relevant to FCA-regulated asset management firms and life insurers. It will also affect issuers, public companies and signatories to the Stewardship Code, and may be of interest to a wider range of stakeholders including pension schemes and their trustees, proxy advisers, investment consultants and industry groups or trade bodies.

Others who may be interested include companies and issuers, policy-makers and regulatory bodies, consumers, charities and civil society groups, industry experts, academics and think tanks.

​​What you need to do

Please send us your comments by 30 April 2019.

Online response form

You can also:

  • email your responses to: [email protected] or
  • write to: Mark Manning, Financial Conduct Authority, 12 Endeavour Square, London E20 1JN

Next steps

We will consider your responses and publish a feedback statement later in the financial year 2019/20.