About the FRC FRC Operational Policies

FRC Operational Policies

Board Diversity Policy

The FRC understands and values the benefits that diversity can bring to its Board. A diverse Board includes and make good use of differences in the skills, experience, background, race, gender and other characteristics of Directors. These skills and backgrounds collectively represented on the Board should reflect the diverse nature of the environment in which the FRC and its stakeholders operate and, improve its effectiveness through diversity of approach and thought.

The Board, supported by its Nominations Committee, annually reviews the composition of the Board and considers the balance of competencies to ensure alignment to the FRC’s mission and strategic priorities; the environment in which it operates; the characteristics, perspectives, independence and diversity of Board members; how the Board works together; and other factors relevant to its effectiveness.

New appointments are made pursuant to the nomination of an Independent Assessor and based on an objective selection criteria highlighting the specific skills and experience needed to ensure a rounded Board and the diversity benefits each candidate can bring to the overall Board composition.

Objectives

The Board will, following recommendations from its Nominations Committee, agree annually measurable objectives for achieving diversity on the Board and its Conduct and Codes & Standards Committees. At the date of adoption of this Policy, the Board’s objective is to improve gender diversity over a three-year period by ensuring that at least one third of the Board and the Committees mentioned above will be comprised of women by the end of 2019 and that each of the Board and the Committees mentioned above has at least one person of colour by 2021.

The Board also places high emphasis on ensuring the development of diversity in the senior management roles within the FRC and supports and oversees the FRC’s objective of ensuring that approximately half of senior roles continue to be held by female executives. This objective is monitored by the Board and built into its assessment of executive performance.

Whether searches for appointment to the Board, the Committees mentioned above, or to the FRC’s senior executive are conducted by the FRC or by external search firms, they will identify and present qualified people of colour to be considered for the relevant vacancy.

Monitoring and Reporting

The Nominations Committee will report annually, in the corporate governance section of the FRC’s Annual Report, on the process used in relation to Board appointments. Such report will include a summary of this Policy, the measurable objectives set for implementing the Policy and progress made towards achieving those objectives.

Any nominations for appointment to the Board, the Conduct Committee and the Codes & Standards Committee will include reporting on compliance with this Policy or will explain any departures from the Policy.

The Nominations Committee will review the Policy, including its effectiveness, annually and recommend any revisions to the Board for approval.

This policy has the full support of the Chairman and the Board.

Adopted on 9 March 2017 and revised 5 July 2017.

Anti-bribery Policy

The Financial Reporting Council (FRC) requires all those who are associated with it to observe the highest standards of impartiality, integrity and objectivity. This requirement relates both to the regulatory activities undertaken by the FRC  and also any commercial activities in which the FRC is involved.

The FRC prohibits anyone acting on its behalf from:

  • Bribing another person. A bribe includes the offering, promising or giving of any financial or other type of advantage

  • Accepting a bribe. This includes requesting, agreeing to receive or accepting any financial, or another kind of advantage; and

  • Bribing a foreign public official 

  • Condoning the offering or acceptance of bribes.

The FRC will avoid doing business with others who do not accept our values and who may harm our reputation.

The FRC will maintain processes, procedures and records that limit the risk of direct or indirect bribery.

The FRC will promote awareness of this policy amongst its staff, those acting on its behalf and entities with which it has any commercial dealings.

The FRC will investigate all instances of alleged bribery, and will assist the police, and other authorities when appropriate, in any resultant prosecutions. In addition,  disciplinary action will be considered against individual members of staff.

The FRC will review this policy regularly and update it when necessary.

Approach to Impact Assessment

Our regulatory principles, published in our updated Regulatory Strategy, commit us to:

Target the use of our powers, taking a proactive, risk-based and proportionate approach, making effective use of Impact Assessments (IAs) and having regard to the impact of regulation on small enterprises.

The FRC follows three guiding principles in producing impact assessments:

  • The work that goes into the production of an impact assessment should be proportionate to the importance of the proposal that it covers.

  • Where a standard is being introduced as a direct response to legislation or regulation, or as part of an agreed policy commitment to adopt international standards of accounting or auditing, the impact assessment should explain the rationale for introducing the standard and should focus on any aspects of the proposed standard which augment the relevant legislation or augment or diverge from the relevant international standard.

  • Where appropriate, we are particularly alert to the impact of proposals on small businesses.

Our projects and activities fall into the following categories, and there are differences between the categories as to what is likely to constitute an appropriate impact assessments:

  • Influencing EU, international and UK Government proposals. We will encourage those bodies to prepare impact assessment, and we will contribute to those impact assessments.

  • Implementing EU, international or UK Government proposals. We will prepare an “implementation” impact assessment addressing the scope and timing of implementation and any elements which augment or diverge from the proposal which is being implemented (eg in relation to the implementation of IFRS).

  • Leading the UK debate on the response to an emerging risk/market development. We will consider the rationale for regulation and alternatives to regulation, the first step in the preparation of an initial impact assessment.

  • Implementing FRC new regulatory requirements. We will prepare an impact assessments based on the Better Regulation Executive guidelines.

  • Proposals to provide or update guidance on existing requirements (eg in updating guidance notes). We will produce an impact assessment based on an appropriate simplified approach.

  • Proposals relating to monitoring, enforcement and discipline. For policy proposals, we will prepare an impact assessment. For individual cases, action will be demonstrably risk-based (eg in relation to priority sectors identified by the FRRP or priority areas for inspection identified by the AIU).

  • Proposals which do not impose regulatory requirements. We will not produce an impact assessment.

FRC project owners will apply appropriate judgement in each case to ensure that the necessary elements are included. 

Consultation Responses Policy

The FRC’s policy is to publish on its website all responses to formal consultations issued by the FRC unless the respondent explicitly requests otherwise. A standard confidentiality statement in an e-mail message will not be regarded as a request for non-disclosure.  The FRC does not edit personal information (such as telephone numbers or postal or e-mail addresses) from submissions; therefore, only information that you wish to be published should be submitted.

The FRC aims to publish responses within 10 working days of receipt.

The FRC will publish a summary of the consultation responses, either as part of, or alongside, its final decision.

Data Protection Policy

The Financial Reporting Council (FRC) collects and processes certain types of personal information as a necessary part of carrying out its responsibilities and administering its operations. Such information is subject to the Data Protection Act 1998.

The FRC collects, handles and uses personal information in accordance with the eight Principles of data protection set out in the Act. It maintains technical and other security arrangements to safeguard personal information and its website contains a statement on how it deals with such information collected through the site.

Such personal information is subject to certain rights of access by the individuals to whom it relates which entitle them to:

  • know what the information is

  • be informed for what purposes the information is being processed and to whom it may have been disclosed

  • the opportunity for incorrect information to be amended or erased.


Any such requests in respect of personal information held by the FRC should be addressed, in writing, to:

The Company Secretary
Financial Reporting Council
8th Floor, 125 London Wall
London
EC2Y 5AS


and should include details of the context in which you believe the FRC is holding the information you seek. This will help us identify it and respond to requests as quickly as possible.

The Data Protection Act includes exemptions from the right of access. The FRC will take these into account in considering requests and this may result in withholding all or part of the information requested.

The FRC may charge for meeting access requests. 

Disclaimer and Copyright

The Financial Reporting Council (FRC) is an independent, unified regulator that:

  • sets, monitors and enforces accounting and auditing standards;

  • oversees the regulatory activities of the professional accountancy bodies, and regulates audit; and

  • promotes high standards of corporate governance.

The terms on which you are entitled to access the FRC Website are set out below. Your access to the site or any part thereof will be deemed to constitute acceptance of these terms. These terms shall be governed by and construed in accordance with English law.

From time to time the FRC may modify these terms. You should therefore review these terms whenever accessing or using this site. The FRC may at any time alter the contents of the pages on the Website.

You must be satisfied that you may lawfully access this site. The FRC accepts no responsibility for unauthorised access or actions of the reader in respect of these matters.

Liability

The information contained on this site is for general guidance only. You should neither act, nor refrain from action, on the basis of any such information. You should take appropriate professional advice on your particular circumstances because the application of laws and regulations will vary depending on particular circumstances and because laws and regulations undergo frequent change.

Whilst the FRC endeavours to ensure that the information on this site is correct, the FRC makes no representations or warranties, express or implied, about the information provided through this Website (including any hypertext links), its accuracy or timeliness. The FRC shall not be liable for any damages (including, without limitation, damages for loss of business or loss of profits) arising directly or indirectly in contract, tort or otherwise from the use of or inability to use this site (or any hypertext links), or any information contained in it (or any hypertext links), or from any action or decision taken as a result of using this site or any such information.

Part of this site may contain material submitted to the FRC by third parties. Third parties are responsible for ensuring that material submitted for inclusion on this site complies with international and national law. The FRC will not be responsible for any error, omission or inaccuracy in the material and reserves the right to omit, suspend or change the position of any material submitted.

The FRC does not warrant that the site is compatible with your computer equipment or that the site is free of errors, viruses, worms or Trojan horses. The FRC shall not be liable for any damage you may suffer as a result of such destructive features.

Hyperlinks

The FRC accepts no responsibility for the content on any site to which a hypertext link from this site exists or for any loss or penalty which may be incurred as a result of any linking to any location through a linked site. The links are provided for information only and on an "as is" basis with no warranty, express or implied, for the information provided within them or the accuracy or source or right to access or use any information found at any other site accessed by means of this Website.

Copyright

Unless otherwise stated, the copyright and other intellectual property rights in all material on this site, including trade marks, logos, photographs and graphical images, are owned by the FRC. All moral rights and equivalent rights in the contents of this Website are hereby asserted.

You are permitted to print and download extracts from this site on the following basis:

  • use of documents and related graphics on this site is for information and non-commercial or personal use within your organisation only;

  • any copies of these pages printed or saved to disk or to any other storage medium may only be used for subsequent viewing purposes or to print extracts for personal use;

  • no further copies, modifications, use or distribution of the material shall be made without the FRC's prior written permission;

  • no documents or related graphics on this site are modified in any way;

  • no graphics on this site are used separately from accompanying text; and

  • all copies, however stored or reproduced, shall retain all copyright and other proprietary notices and this permission notice and disclaimer.

No part of this site may be reproduced or stored in any other Website or included in any public or private electronic retrieval system or service without the FRC's prior written permission. Copyright requests should be directed to Alison Chambers.

Any rights not expressly granted in these terms are reserved.

Service access

Whilst the FRC endeavours to ensure that this site is normally available 24 hours a day, the FRC will not be liable if for any reason the site is unavailable at any time or for any period.

Access to this site may be suspended temporarily and without notice in circumstances of system failure, maintenance or repair or for reasons beyond the control of the FRC.

Indemnification

You agree to indemnify, defend and hold harmless each of the FRC, its employees, representatives and agents, against any claim, suit, action, or other proceeding brought against the FRC, its employees, representatives or agents, by a third party, to the extent that such a claim, suit, action or other proceeding brought against the FRC, its employees, representatives or agents is based on or arises in connection with (i) your use of, including any downloading from or uploading to, the site; (ii) any breach by you of these terms; (iii) a claim that any use of the site by you (aa) infringes any intellectual property rights of any third party, or any right of personality or publicity, or (bb) is libellous or defamatory, or otherwise results in injury or damage to any third party; (iv) any deletions, additions, insertions, or alterations to, or any unauthorised use of, the site by you; or (v) any misrepresentation or breach of representation or warranty made by you contained herein.

References in this section of these terms to your use of this site shall be deemed to include any use by a third party where such a third party accesses the site using your computer. You agree to pay the FRC, its employees, representatives and agents any and all costs, damages and expenses, including, but not limited to, reasonable professional fees (on a solicitor-client basis) awarded against any of them or otherwise incurred by any of them in connection with or arising from any such third-party claim, suit, action or proceeding attributable to any such third-party claim.

Freedom of Information

The Freedom of Information Act 2000 (the Act) was passed on 30 November 2000.  The Act:

  1. gives a general right of access to information held by public authorities, subject to the exemptions set out in the Act

  2. imposes an obligation on public authorities to produce and maintain a Publication Scheme approved by the Information Commissioner.  

The FRC is a public authority for part of its functions (see below).  

The FRC and the Act

The FRC is designated as a public authority under section 5 of the Act in relation  to the FRC’s exercise of those statutory functions delegated to it under Part 42 Companies Act 2006 (section 1252(3)) and the exercise of the functions pursuant to its appointment as the Independent Supervisor (section 1228(3).

Market Sensitive Information

Introduction and Objectives

This document sets out the principles, policies and procedures by which the FRC aims to
protect market sensitive information (MSI) and guide our staff on how they should handle
any information they receive or generate which they suspect may amount to MSI. The
policy’ objectives are

  • To help staff identify MSI and recognise that MSI triggers a significant publication risk (both by inadvertent leaking or planned publication);

  • For staff to take active steps to minimise this risk by applying additional controls to the MSI as well as the FRC’s standard confidentiality, information security and record keeping policies;

  • To ensure that if the FRC deliberately releases MSI through a planned publication, we release it to the market simultaneously and in an appropriate, factual and evidence-based manner;

  • To reduce the risk that inaccurate or sensationalist press reporting and ill-founded speculation could convert non-MSI information released by the FRC into MSI.

Principles

The FRC (we) will apply the following Principles of Good Practice:

  • Policies & procedures: We will maintain and operate internal policies & procedures for the use and control of MSI, which will recognise the responsibility to control access to MSI and aim to reduce the risk of its inadvertent disclosure or misuse.

  • Awareness and training: we will take appropriate measures, including training, to assist our staff in understanding the importance of keeping information appropriately protected and the implications of improper disclosure of MSI (including criminal and civil liability which may arise). We will aim to ensure that our policies & procedures are capable of being readily understood by all of our staff.

  • Need to know and other information controls: we will take reasonable steps to limit the number of staff who can access MSI received or generated by the FRC.

  • Passing market sensitive information internally and externally: we will take reasonable care that where MSI is received or generated by staff and/or provided to a third party the staff member and the third party is aware of their obligations in relation to the use and control of the information.

  • Information technology security: We will give appropriate consideration to the security of and access to MSI on IT systems including the implementation of controls to limit access.

Responsibility

  • The Executive Committee will be responsible for maintaining our MSI policy and internal working procedures.

  • Internal working procedures will be monitored by the Governance and Legal Team who will report at least annually to the Executive Committee.

  • Human Resources and Learning and Development will be responsible for training staff, with the assistance of the Governance and Legal Team.

  • Policies and procedures will be reviewed annually.

December 2016