The Financial Conduct Authority has published a Policy Statement containing final Handbook text and guidance on new rules to improve shareholder engagement and increase transparency around stewardship. The FCA consulted on the rules from January to March 2019. The final rules will come into effect on June 10, 2019.
 
The FCA has aligned its Handbook provisions to comply with the amended Shareholder Rights Directive, commonly known as SRD II, which came into force on June 9, 2017. Those caught by the FCA's rules include life insurers, asset managers and companies with shares admitted to trading on a regulated market. The rules adhere closely to the provisions of the Shareholders Directive. Amongst the requirements, which may be relevant to some asset managers and life insurers, is an obligation to publish an engagement policy, setting out how the firm integrates shareholder engagement considerations in relation to its investments, on a comply or explain basis. The obligation comes into effect from June 10, 2019. The FCA has announced that for an initial period, a firm can comply with the rule by explaining what it is doing to develop its policy or, alternatively, to decide whether based on its circumstances it requires a policy at all.
 
In implementing the Directive, the FCA aims to achieve improvements in transparency and disclosure to enhance dissemination of information to shareholders; increased engagement by asset managers with the governance of the companies they invest in; protection of the long term interests of consumers through effective stewardship of companies; and enhanced competition between firms to deliver higher standards of investment decisions and oversight of assets.
 
View the FCA's Policy Statement on promotion of shareholder engagement.
 
View the FCA's Shareholder Rights Directive (Asset Managers and Insurers) Instrument 2019. 
 
View the FCA's Listing and Disclosure Sourcebooks (Shareholder Rights Directive) Instrument 2019.

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