Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019 — House of Lords, 2019-05-08
Topic: Domestic Commerce
Oliver Michael Robert Eden (Conservative, Centre-right): My Lords, as always, I thank both noble Lords for the positive side of their contributions to this debate—but thereafter it went a bit negative. The noble Baroness, Lady Kramer, supported by the noble Lord, Lord Stevenson, seemed to imply that we had been dragged kicking and screaming into bringing the regulations to the House. I assure them that that is not the case We were engaged in all the activity related to the EU in developing the regulations, but, as both noble Lords will know—probably far better than me, because they have been involved in BEIS matters for longer—this goes back quite a long way. Various improvements were made in 2013 and in 2018 to company reporting. So we have done quite a lot domestically, and we were involved with the EU in bringing regulations to book which, as the noble Baroness said, were produced in 2017 but do not need to come into effect until June this year. That date we will meet, and that is why we are bringing forward the regulations at this moment We have been preparing for a year to implement these measures. Those preparations had to take account of the new Commission guidance on the directive published last year, in 2018, and it would not have been fair to have introduced these new EU rules on UK companies two years before other companies in the EU. It is therefore quite right that we bring them forward at this stage. They form part of the Government’s wider corporate reform package that I mentioned, part of which was implemented last year and part of which was implemented earlier Both noble Lords asked about other government departments and the FCA. As I said, the FCA, DWP and the Treasury have to implement other parts. The Treasury will shortly be laying draft regulations. I do not know who in this House will do it; I imagine that it will be my noble friend Lord Young, as my noble friend Lord Bates is off on one of his walks. The measures in the directive are designed to increase transparency in the work of so-called proxy advisers, who advise institutional investors on the companies in which they invest DWP will shortly lay draft regulations to implement new measures in the directive covering how pension fund trustees carry out their stewardship roles with investee companies. The FCA will make changes to its handbook to give effect to new obligations under the directive covering asset managers and the disclosure of related party transactions by public companies, but that obviously will not need the same parliamentary scrutiny as these regulations. My department—BEIS—will also bring forward measures. I do not know whether they will be affirmative or negative, but I will advise the House in due course. We will bring forward appropriate measures to implement the final parts so that they can be brought into effect by September 2020 Finally, the noble Lord, Lord Stevenson, asked about an impact assessment. I think that I made it pretty clear in my opening remarks that we did not think an impact assessment necessary, which is why we consulted widely with all the appropriate bodies, individuals and other parties. As a result of their comments, I am told, we made some changes and felt that an impact assessment was not necessary I believe that I have answered all the questions. As I said, we were not dragged kicking and screaming into doing this; we believe that the regulations are an appropriate response from the Government, partly to meet our obligations because we are still in the EU but also as part of the wider package I talked about, which came in last year and on earlier occasions.