Signatories to the code have been tiered according to the quality of the reporting in their statements based on the seven principles of the code, which operates on a ‘comply or explain’ basis. Asset managers have been categorised in three tiers and other signatories in two tiers.

The regulator says there are nearly 300 signatories to the code, of whom 120 are graded as being in tier 1, an increase from approximately 40 at the beginning of the exercise. This represents nearly 90% of assets under management of members of the Investment Association.

Tier 1 signatories provide a good quality and transparent description of their approach to stewardship, while tier 2 signatories are judged less transparent in their approach.

In contrast, those graded at tier 3 need to make significant reporting improvements, as they either continue to provide generic statements or have poor explanations. Companies listed in this category include Brewin Dolphin, Charles Stanley and Apax Partners. 

Asset managers who have not achieved at least tier 2 status after six months will be removed from the list of signatories as their reporting does not demonstrate commitment to the objectives of the code. Over 200 signatories approached the FRC to discuss improving their reporting against the code, the regulator says.

Stephen Haddrill, CEO, FRC said: ‘Reporting against the stewardship code is not a box-ticking exercise and signatories were encouraged to provide a clear description of their approach to stewardship, with explanations for non-compliance where appropriate.

‘We will be looking for continuous improvement from code signatories, but we are pleased with the response to this exercise and many signatories have reaffirmed their commitment to quality, transparent reporting and to stewardship.’

The FRC’s assessment of UK stewardship code statements is here.