The number of signatories to the UK Stewardship Code has grown from 125 in September 2021 to 199 in March 2022, after the Financial Reporting Council (FRC) received "substantially more" applications than expected.

The FRC confirmed that it received a total of 105 applications, of which 74 were successful, bringing the total number of signatories to the code to 199, including asset managers with £33trn in global assets under management.

It highlighted this growth as a “positive sign” that so many investors and service providers want to demonstrate their commitment to effective stewardship, also noting that there was an “encouraging level” of applications from organisations that were previously unsuccessful.

According to the council, many of these organisations had addressed previous feedback and now provided better quality of reporting of their stewardship activities.

New signatures also included a number of Local Government Pension Schemes (LGPS), including Cumbria, Devon and Avon, as well as private pension schemes, such as the Jaguar Land Rover Pension Trustees, Tesco Pension Fund and the Co-operative Pension Scheme, and industry bodies, such as the board of the Pension Protection Fund (PPF).

Industry concerns have previously been raised over the number of insurers to back the code, however, after analysis revealed that just two bulk annuity insurers, Aviva and Scottish Widows, were signatories to the code.

The UK Stewardship Code was updated in 2019 to require signatories to declare whether they have taken environmental, social and governance (ESG) factors factors into account, with a revised code brought into effect from 1 January 2022.

Following engagement with stakeholders, however, the FRC has confirmed that it will not differentiate or tier signatories to the code from 2022.

It explained that asset owners, investment consultants and investment managers felt that the standard to become a stewardship code signatory is already high, and that the council should instead focus on encouraging more of the market to reach this standard.

Commenting on the updates, FRC executive director of regulator standards, Mark Babington, commented: “We are pleased that many previously unsuccessful organisations have provided stronger and better tailored explanations on how they apply the code to more effectively demonstrate their stewardship activity and outcomes.

“We commend those that have embraced the spirit of the code and responded to our feedback by substantially reviewing their approach to provide clear, comprehensive and outcome-based reporting.”

The deadline for submitting annual stewardship reports and any new applications is 30 April 2022.

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