Corporate governance: key considerations for directors

It involves balancing the interests of various stakeholders, such as shareholders, employees, customers, suppliers, regulators, and the community. Corporate governance also aims to ensure accountability, transparency, fairness and ethical conduct in the company’s operations and decision-making.

The main source of corporate governance guidance is the UK Corporate Governance Code, which applies to companies with a premium listing on the London Stock Exchange. Unlisted companies may choose to follow the Code, but it is not a requirement. The Code operates on a ‘comply or explain’ basis, meaning that companies must either follow the principles and provisions of the Code or explain why they have deviated from them in their annual report.

The Code is divided into five sections, covering the following governance aspects:

  • Board leadership and company purpose: This section sets out the role and responsibilities of the board, the chair, the chief executive, and the company secretary. It also emphasises the importance of having a clear purpose, values, and strategy, and engaging effectively with stakeholders.
  • Division of responsibilities: This section deals with the composition and structure of the board, the separation of powers between the chair and the chief executive, the role of non-executive directors and the independence of the board.
  • Composition, succession and evaluation: This section covers the appointment, reappointment, removal, and diversity of board members, as well as the evaluation of their performance and effectiveness.
  • Audit, risk and internal control: This section outlines the responsibilities of the board and the audit committee in relation to the financial reporting, internal control, risk management and external audit of the company.
  • Remuneration: This section sets out the principles and provisions for determining and disclosing the remuneration policy and practices of the company, and ensuring alignment with the company’s purpose, values, strategy, and long-term success.

Directors of UK companies have a legal duty to act in the best interests of the company and its members, as well as to consider various other factors, such as the long-term consequences of their decisions, the interests of employees, the impact on the environment and the reputation of the company.

Directors should also be aware of the relevant regulations and standards that apply to their company, which include the UK Listing Rules and the UK Stewardship Code. These standards provide further details and requirements on specific aspects of corporate governance, such as shareholder engagement, audit quality, remuneration structures and board diversity.

Corporate governance is not a one-size-fits-all concept, and directors should exercise their judgement and discretion in applying the principles and provisions of the Code to their company’s specific circumstances and needs. However, directors should also be prepared to explain and justify their decisions to their shareholders and other stakeholders and demonstrate how they have contributed to the success and sustainability of the company. By doing so, directors can enhance the trust and confidence of the market and society in their company and its governance.

The current Code was published in 2018. Following a limited consultation which focused on a specific number of changes, there was an update to the 2018 Code in January 2024. The key changes can be read here and will be in effect from 1 January 2025.

If you have queries on directorships or your duties as a director, please contact Katie Holden, Company Secretarial Senior Manager.

Changes to Companies House filing fees

The key changes include adjustments across various filing services, with an emphasis on both digital and paper submissions. The fee increase is intended to support the implementation of new technologies and processes that will streamline operations, improve the accuracy of company data, and bolster measures against economic crime.

Moreover, the changes are a part of a comprehensive overhaul that includes several other significant updates. These include the introduction of identity verification for individuals setting up, running, owning, or controlling companies in the UK, the transition towards filing accounts solely via software to reduce errors, and measures to protect personal information on the register.

Who will be affected?
The revised fees impact various services, including:

  • Incorporation: The fee for setting up a limited company using the Companies House website will increase from £12 to £50.
  • Change of name: Businesses seeking to change their company name will also be subject to the new fees.
  • Confirmation statements: Companies submitting annual confirmation statements will experience adjusted costs.
  • Re-registration: Fees related to re-registering a company will be affected.

You can find a list of all new filing fees on the Companies House website here.

What will this mean for businesses?
Businesses must prepare for the financial implications of the updated fee structure and adapt to the new filing requirements. It’s essential to be aware of these changes and plan accordingly to manage these new costs and maintain compliance.

If you have any questions or concerns about the new filing fees, get in touch with Katie Holden, Company Secretarial Senior Manager, to see how we can support you and your business with the upcoming changes.

What is company re-registration?

Re-registration is not a decision which should be taken lightly and strict rules must be followed to lawfully and successfully carry out such a procedure. Below, we detail the process of changing from a private company to a public one.

What is a Public Limited Company?

A Public Limited Company (PLC) means that the company has the legal right to offer shares to the public under the Companies Act of 2006. When a company floats its shares in the UK, it must re-register as a public company. Once legally re-registered, the company would be eligible to list on a stock exchange to enable the sale of shares.

A private company may choose to go public to access more capital through an initial public offering (IPO). The most significant benefits of an IPO include being able to fund expansion, pay off debts, or invest in new projects more efficiently than private funding routes.

Re-registration from an LTD to a PLC

A company needs to have a number of things in place to prepare for re-registration:

  • A minimum of £50,000 authorised and allotted share capital.
    • A minimum of 25% of the nominal value of those shares must have been paid up.
    • Any share premiums must have been paid.
  • A minimum of at least two directors and one company secretary.
  • Special resolution where 75% of shareholders vote to go public.
  • A balance sheet which has been prepared at a date of no more than seven months before application of the re-registration.
    • The balance sheet must have either an unqualified or qualified auditor’s opinion, including an opinion that the qualification is not material for determining the net assets of the company. In other words, any concerns that an auditor may have about the company’s financial statements are not significant enough to impact the decision of registering as a PLC.
  • A written opinion from the auditors that, at the balance sheet date, the company’s net assets are greater than the aggregate of called up share capital and undistributable reserves.
  • Between the date of the balance sheet and the application for re-registration taking place, there must be no change in the company’s financial position that results in the amount of its net assets becoming less than the aggregate of it’s called-up share capital and undistributable reserves.
  • Issue new articles of association.
  • The application form ready to be submitted to Companies House.

Re-registration is not effective until Companies House issues a certificate of incorporation on re-registration. This certificate replaces the original certificate of incorporation and confirms the new status of the company.

Re-registration is a complex and significant process that requires careful planning and professional advice. If you are considering re-registering your company as it relates to the IPO process, please get in touch with Laura Mott, Partner and Co-Head of Transaction Advisory Services, or for further information on company secretarial services, contact Katie Holden, Company Secretarial Senior Manager.

Updating your information on the Register of Overseas Entities

This now means that if you own or control an overseas entity that owns UK property or land, you need to update your information on the Register of Overseas Entities every year. An update statement is a document that confirms or updates the information about your overseas entity and its beneficial owners or managing officers. Updating your information is now a legal requirement and non-compliance can lead to severe consequences.

When and how do you file an update statement?

You need to file an update statement every year, within 14 days of the anniversary of your registration date. To file an update statement, you need to review and verify the information regarding your overseas entity and its beneficial owners or managing officers, to ensure that the information on the register is correct and reliable. These checks must be done independently by a UK-regulated agent with an agent assurance code, which will be provided with submission of the update statement. The agent will check the information that you provide and will confirm that it is valid and authentic. The agent will also submit a verification statement on your behalf.

Verification checks must be completed within three months before the date of your update statement. If not done within this timeline, your update statement will be rejected.

It should be noted that if the overseas entity is a trust, a paper form will need to be submitted instead, since trusts have different rules and requirements for registration and verification.

Consequences of not filing

If you fail to file an update statement on time, you may face serious consequences. Companies House has issued guidance on how it will enforce penalties and ensure the integrity of the register. These include:

  • Committing a criminal offence, which can lead to prosecution, fixed or daily rate penalties, up to £50,000 for each property.
  • Having an invalid overseas entity ID, which means you cannot sell, lease, or charge your UK property or land. The overseas entity will not be able to purchase any new land or property in the UK either.
  • Having a public note of non-compliance on the register, which can damage your reputation and trustworthiness.

Therefore, it is important to file an update statement every year and keep your information accurate and up to date.


Although the update statement is a yearly requirement, each overseas entity should be checking whether any of the information it provided with its original application has changed – importantly, an update statement can be submitted more than once a year. However, even if only done once a year, regularly checking for any changes will help officers to be prepared to submit the overseas entity’s update statement in a timely manner, meeting their compliance requirements and avoiding any potential consequences.

In support of the Economic Crime (Transparency and Enforcement) Act, the Economic Crime and Corporate Transparency Bill (the Bill) meanwhile has received Royal Assent and is now law. We will continue to analyse all parts of the Bill that are relevant for company officers to be aware of. In the meantime, you can review our previous analysis below:

For assistance with your corporate governance duties, contact Katie Holden, Company Secretarial Manager.

Companies House reform: What we know so far

Our analysis so far

We have analysed key parts of the Bill to date and broken our findings down into four parts, which you can read below:

Accounts filed at Companies House

The latest update on the Bill regards filing accounts at Companies House. The focus is on what information is filed at Companies House so that it will more closely reflect a company’s accounts. The reform proposes that:

  • Filing obligations for micro-entities and small companies will become clearer by reducing the filing options. This will remove the abridged and ‘filleted’ accounts options.
  • Companies House will require a balance sheet, profit and loss account and directors’ report for all micro-entities and small companies. Where a company satisfies the micro-entity threshold, the directors’ report filing becomes optional.
  • Dormant companies will have to file an eligibility statement, confirming that the company is not trading and meets the criteria for filing dormant accounts. This is intended to act as a deterrent to criminal activity.
  • Small companies and micro-entities must file sufficient information to confirm they qualify for their accounting category.

Further changes are proposed as part of the Bill, to be introduced at a later date, including:

  • Accounts filed at Companies House must be digitally filed and fully tagged in iXBRL format.
  • Reducing the number of times a company can shorten its Accounting Reference Period, suggested to be once every five years.

We will continue to follow the Bill’s progress as it makes its way through Parliament. For further queries on how the Bill may impact you, or for any company secretarial needs, contact Katie Holden, Senior Manager or a member of our Company Secretarial team.

Companies House reform: new rules for officers

We have discussed the aims of the Bill and the Registrar’s new powers here, looked at the new identity verification process here and analysed the impact on company incorporations here. In this article, we will look at the proposed reform for company directors and shareholders, and what impact this may bring.

New rules for directors

In addition to identity verification, key things to note for directors include:

  • A person subject to UK sanctions cannot act as a director of a company, or form or manage one. These sanctions include:
    • Trade sanctions
    • Financial sanctions, including frozen assets
    • Immigration sanctions, known as travel bans
    • Aircraft and shipping sanctions
  • A person cannot act as a director of a company unless the company has notified the Registrar of the director’s appointment.
  • If a director is disqualified under the Company Directors Disqualification Act 1986, the director will automatically cease to hold office on disqualification.
  • In addition, corporate directors of UK companies will no longer be allowed to act as a director unless they satisfy an exemption, which will require the corporate director to:
    • Be an existing incorporated company in the UK and have only natural persons acting as directors; or
    • Have at least one natural person acting as a director in the company alongside the corporate director.

New rules for persons with significant control (PSCs)

PSCs must also go through an identity verification process, like directors. In addition to the requirement for identity verification mentioned above, the Registrar will make available:

  • More information from companies claiming an exemption from the requirement to provide details of their PSCs, including the reason for the exemption; and
  • The conditions satisfied which allow a relevant legal entity (RLE) to be recorded as a PSC.

Statutory registers

The Bill will propose that companies no longer need to keep their own register of directors, directors’ residential addresses, register of secretaries or a PSC register, however they are still required to notify Companies House of any related changes.

Shareholders and the annual confirmation statement

Private companies will no longer be able to keep its register regarding their shareholders on the Companies House register – they will now have to maintain this themselves. As a one-off, the register must include full names and addresses of individuals in the next annual confirmation statement, after the Bill is passed.

Preventing the abuse of personal information

The Bill includes the ability for individuals, whose details appear publicly on the Companies House register, to apply to have their personal information suppressed from public disclosure.

Individuals can apply to suppress:

  • Residential address in most instances where it appears on the register (for example, when used as a registered office address)
  • Signatures
  • Business occupation
  • The day of date of birth for documents filed prior to 10 October 2015
  • Name (current or previous)
  • Sensitive addresses, with evidence that the residents are at serious risk of violence or intimidation

What these changes mean

In summary, these changes are welcome and will bring a positive impact in ensuring the prevention of personal data abuse, and that directors are appropriately appointed. It is also useful for individuals who will have greater ability to suppress their personal information to help with data protection breaches.  However, it does seem that it will bring on additional burdens where companies can no longer hold their statutory registers with Companies House -they may have to either ensure that individuals within the company have the capabilities of ensuring such registers are updated appropriately and as per the Companies Act 2006, or seek assistance elsewhere, such as from an Authorised Corporate Service Provider (“ACSP”), which can be an additional financial burden to the company.

You can read our full analysis of all major parts of the Bill and the Companies House reform below:

We will continue to follow the Bill’s progress as it makes its way through Parliament. If you require further information, please get in touch with Katie Holden, Senior Manager, or a member of the Company Secretarial team.

Companies House reform: new powers for the Registrar

The Registrar of Companies role will also change – it will promote and maintain the reliability of the Companies House register. Due to its lack of regulatory power, Companies House is unable to investigate companies it believes may be used for money laundering or fraud. As a result, The Bill aims to enhance the Registrar’s powers, so it becomes a more active gatekeeper for company creations with more reliable data, rather than being a largely passive recipient of information, as it is now.

New Registrar powers

The Bill proposes that new powers should be introduced for Companies House to:

  • Reject and query documents with inconsistencies against information already on the register, where those documents could be fraudulent.
  • Remove material from the Companies House register.
  • Request additional information in relation to the delivery of documents to Companies House.
  • Share data with law enforcement and other public authorities where necessary.
  • Impose financial penalties for those engaged in conduct amounts to an offence, under the Companies Act 2006.
  • Change a company’s registered office address and take action against those who fail to provide one.
  • Remove constraints on the Registrar’s ability to make rules regarding the digital delivery of documents and filings.

How will companies be affected by these new powers?

The proposals to enhance the Registrar’s powers is just one part of the wider Economic Crime and Corporate Transparency Bill. These changes have been long anticipated, and they will represent a positive and significant change to the way that Companies House will operate and how companies need to be administered. One of the benefits of increasing the Registrar’s powers is that Companies House will be able to remove material from the register, rather than having to seek a court order, which is time consuming and costly for companies. In addition, there will be more security in ensuring that accurate information is held on public record, stopping fraudulent documents from being filed – such as false accounting documents – or a director from being appointed who is on the UK sanctions list. With additional powers, the Registrar will be able to help protect companies and their employees from such fraudulent activities and other harms.

We have provided analysis of:

We will continue to analyse all parts of the Bill to ensure you are well informed and understand how it could impact you.

If you require further information, please get in touch with Katie Holden, Senior Manager, or a member of the Company Secretarial team.

Dos and dont’s for directors: Business Leader

Katie makes it clear that, whilst being a company director comes with significant powers, there are also statutory duties that they must follow, in line with the Companies Act 2006.

If a director does not adhere to these duties, there are several penalties that can be levied, including fines, and being disqualified as, or even prohibited from, acting as a director. In the most severe cases, criminal prosecution is also possible.

Katie’s recommendations of what directors should and should not do are practical tips for those trying to stay on the right side of the Companies Act. You can read the recommendations in full in Business Leader here.

If you have questions or concerns around your role as a director and would like further guidance, please contact Katie directly or get in touch with a member of the Company Secretarial team.

Companies House reform: the impact on company incorporations


For new company incorporations, individuals must confirm that they wish to form a new company for lawful purposes. Individuals must also confirm that none of the proposed officers or persons with significant control (PSCs) are disqualified from being a director, under the directors’ disqualification legislation (the Company Directors Disqualification Act 1986). If the subscribers are individuals, the Bill will make it clear that their full name is required to be included on the memorandum of association.

Company names

The Bill proposes that the Registrar will be able to reject company incorporations where the company name:

  • Contains or includes a computer code.
  • Could be used to facilitate crime.
  • Suggests a non-existent connection with a foreign government or an international institution.

A company’s registered name can also be challenged on the basis that  it may be confused with a name which has generated goodwill, and would be likely to mislead anywhere in the world, not just in the UK as it is now. It will also be an offence to use a business name in the UK that suggests a connection with a foreign government or international body, where none exists.


The Bill will give the Registrar new powers to change a company’s name if it falls into the new stipulations above or under the Companies Act 2006.

If a company fails to make the required name change within a defined period, the Registrar will have the power to replace that company’s name with its company number.

Any individual who uses a business name which the Registrar has said should be changed, will be committing an offence and could face a penalty of up to £1,000 if they continue to use that name.

Registered offices and email addresses

A company’s registered office will now be required to be at an “appropriate address”. This is an address where:

  • A document addressed and delivered to the company would be expected to come to the attention of a person acting on behalf of the company; and
  • The company can receive an acknowledgement of delivery of the documents.

Companies will also be required to maintain an “appropriate email address” – one where any emails sent by Companies House will be seen by the person acting on behalf of the company.

First Annual Confirmation Statement

As a one-off, in the first confirmation statement following company incorporation, and after the relevant section of the Bill comes into force, companies whose shares are not publicly traded will need to provide the names and addresses (as they appear in the company’s register of members) of all their members. Publicly traded companies will have to provide names and addresses of members holding at least 5% of the issued shares of any class of the company.

Further commentary

In summary, these changes are welcome in ensuring fraudsters are unable to incorporate companies to exploit the UK’s economy, but it does come with its own challenges. The Bill will make registering a new company more time consuming, which before was relatively easy. With this, there are concerns about whether the Registrar will have adequate resources to allow for such checks to be conducted thoroughly.

Additionally, the new incorporation penalty fees are the lowest in the world, with the majority of incorporations being processed within 24 hours. If the government is serious about developing its role as a ‘gate keeper’, it must focus on ensuring adequate checks are being made, rather than focusing on swift turnarounds on incorporations.

We will continue to follow the Bill’s progress as it makes its way through Parliament. In the meantime, we will continue our analysis of the Bill to focus on the new rules for directors in our next post. If you require further information, please contact Katie Holden, Senior Manager, or a member of the Company Secretarial team.

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