Governance Briefing — April 20, 2022

Executive briefing: On 20 April 2022 the UK Financial Conduct Authority (FCA) released Policy Statement PS22/3, amending the Listing Rules and Disclosure Guidance and Transparency Rules to introduce ‘comply or explain’ diversity targets and mandatory data reporting for premium and standard listed companies. The rule establishes minimum representation thresholds for women and ethnic minorities on boards and executive management, compelling issuers to strengthen nomination governance and succession planning.

Key requirements

Diversity targets. Listed companies must report on whether at least 40% of board seats are held by women, one senior board position is held by a woman, and at least one board member is from a minority ethnic background.
Standardised reporting. Annual reports must include a prescribed table showing gender and ethnicity composition of boards and executive management.
Overseas companies. Issuers with different board structures must explain how they meet or diverge from the targets.

Implications for boards

UK-listed corporates. Nomination committees must embed diversity metrics into succession plans, search mandates, and performance evaluations.
Financial institutions. Banks and insurers must align PRA and FCA diversity strategies, ensuring board governance integrates regulatory expectations.
International issuers. Companies with dual listings should harmonise reporting templates and clarify how governance structures satisfy FCA targets.

Action checklist

Update board reporting packs with FCA-prescribed diversity tables and narrative explanations.
Refresh search firm mandates and nomination committee charters to incorporate FCA targets and pipeline monitoring.
Coordinate investor communications to explain progress or deviations from the new targets.

Sources

Zeph Tech supports listed companies with diversity data governance, reporting automation, and nomination committee governance aligned to FCA PS22/3.