Why your company needs a legislation register

In the intricate world of corporate governance, maintaining a legislation register is not just a matter of compliance, but a cornerstone of sound business practice. A legislation register, often part of a company’s statutory registers, serves as a vital record that documents a company’s adherence to legal and regulatory requirements. The reasons for companies to maintain such a register are multifaceted and underscore the importance of transparency and accountability in the corporate sphere.

Firstly, a legislation register provides a historical and current record of a company’s compliance with laws and regulations. This is crucial for any business as it demonstrates due diligence and a commitment to lawful operation. It is a tangible way for a company to show that it is up to date with the ever-changing legal landscape, which can be particularly complex in areas such as environmental law, employment practices, and financial regulations.

Legislation register

Moreover, the register acts as a definitive guide to the company’s history, its directors, and its owners or shareholders. For instance, the register of members, which is a mandatory requirement under section 113 of the Companies Act 2006, is the authoritative statement of who the members of the company are and what shares they hold. This is not just a formality; it is the key evidence of ownership and is essential in the event of a sale, merger, or other significant share transactions.

Failure to maintain accurate statutory registers can lead to severe consequences. It is considered an offense by the company and each of its officers by default, and directors may also be found in breach of their duties. The implications of such breaches can be far-reaching, including legal penalties, delays in business transactions, and potential damage to the company’s reputation.

Furthermore, statutory registers are not to be confused with filings at Companies House, which is a public registry for making company information available. While these filings are necessary, they do not replace the need for a company to maintain its own statutory registers. The information filed at Companies House does not normally give legal effect to transactions, which is a common misconception that can lead to significant issues, such as the unlawful distribution of dividends or tax complications.

In essence, a legislation register is a safeguard, a reference point, and a source of truth for a company’s legal standing. It is an indispensable tool for ensuring that a company operates within the bounds of the law and maintains the trust of its stakeholders. By keeping a meticulous record of compliance, companies can navigate the complexities of corporate legislation with confidence and integrity.

In conclusion, the maintenance of a legislation register is a critical aspect of corporate governance. It is a reflection of a company’s commitment to legal compliance, transparency, and accountability. As the business environment continues to evolve, the role of the legislation register remains steadfast, providing clarity and certainty in a world of legal complexities. For any company looking to establish or maintain its credibility and legitimacy, a well-maintained legislation register is not just recommended—it is essential.

What are the key components of a legislation register

A legislation register is an essential tool for organisations to manage their legal and regulatory compliance. It serves as a comprehensive database that records all the legislative requirements applicable to the company’s operations. Here are the key components that typically constitute a legislation register:

Legal Requirements

This is the core of the register, listing all relevant laws, regulations, standards, and codes of practice that the organisation must comply with. It includes national, regional, and local laws, as well as industry-specific standards.

Description and Applicability

For each legal requirement listed, the register should provide a concise description. This includes the scope of the law, its objectives, and how it applies to the organisation’s activities and operations.

Compliance Status

The register should reflect the current compliance status for each legal requirement. This involves indicating whether the organisation is compliant, in the process of becoming compliant, or non-compliant, along with any notes on potential risks or issues.  The register may also indicate the date when the legislation takes effect if it is at a future date.

Implementation Measures

This section details the actions taken by the organisation to comply with each legal requirement. It may include procedures, controls, training programs, and other measures implemented to ensure compliance.

Review and Update

Laws and regulations are subject to change, and the legislation register must be regularly reviewed and updated to reflect these changes. This ensures that the organisation remains compliant with the latest legal requirements and can make relevant adjustments to its operating practices where required.

Documentation and Records

The legislation register should include or reference all documentation that evidences compliance with the legal requirements. This could be policies, procedures, audit reports, or any other relevant records.

Evidence of Compliance

By maintaining a detailed and up-to-date legislation register, organisations can demonstrate their commitment to legal compliance, reduce the risk of non-compliance penalties, and maintain a reputation for integrity and responsibility. It is a critical component of effective governance and risk management strategies.

Consequences of inadequate records

Maintaining a comprehensive and accurate legislation register is a critical component of an organisation’s compliance and assurance framework. Inadequate record-keeping within such registers can have far-reaching and severe consequences for businesses. Here are some of the potential repercussions:

Legal Penalties

Organisations may face legal penalties for failing to keep adequate records. For example, in the UK, a penalty of up to £3,000 may be charged for each failure to keep or preserve adequate records related to tax returns or claims.

Poor Decision Making

Inadequate record-keeping can lead to poor decisions based on incomplete or outdated information. This can result in strategic missteps, financial losses, and missed opportunities.

Security Breaches

Failure to handle information securely can lead to data breaches, with sensitive information potentially being exposed. This not only violates data protection laws but can also cause harm to individuals and damage the organisation’s reputation.

Operational Inefficiencies

Poor records management can lead to inefficiencies within the organisation. Time and resources may be wasted searching for missing or poorly organised documents, leading to delays and reduced productivity.  Poor records can also result in a knowledge gap within the organisation.

Legal Action

In some sectors such as health and social care, inadequate record-keeping can lead to severe consequences, including harm to clients and legal action against care providers. Accurate and up-to-date records are essential for the continuity of care and legal compliance.  Accurate records can also prove to be valuable evidence in defending any claims or prosecutions by regulatory bodies.

Professional Consequences

Professionals may face personal and professional consequences due to poor record-keeping. This includes accountability for their actions and omissions, which could result in disciplinary action or loss of their licence to operate.  Professionals such as accountants, medical staff and solicitors are governed by professional bodies which can take enforcement action against individuals.

Reputational Damage

An organisation’s reputation can suffer significantly if it becomes known for poor compliance practices. This can lead to a loss of trust among stakeholders, customers, and the public.  This often leads to a drop in sales and increase in litigation.

Financial Implications

Inadequate record-keeping can have direct financial implications, from fines and penalties to the costs associated with rectifying the issues. It can also impact the organisation’s ability to secure funding or investment.

Audit Failures

Organisations may fail audits due to inadequate records, which can lead to further scrutiny from regulatory bodies and the potential for additional sanctions.  Adverse audit findings can also discourage others from investing in the company or using it as a supplier.

Business Continuity Risks

In the event of a disaster or crisis, poor record-keeping can hinder recovery efforts, as vital information may be inaccessible or lost.  Robust business continuity plans will indicate what records are available and required to quickly recover from a crisis.

In conclusion, the importance of maintaining a robust legislation register cannot be overstated. Organisations must recognise the potential consequences of inadequate record-keeping and take proactive steps to ensure their compliance records are complete, accurate, and up-to-date. This involves implementing effective records management policies, regular training for staff, and the use of technology to streamline the record-keeping process. By doing so, organisations can mitigate risks, maintain operational efficiency, and uphold their legal and ethical responsibilities.

Keep your legislation register up to date

In the dynamic landscape of legal compliance, keeping legislation registers current is a critical task for organisations. A legislation register that is not up to date can lead to non-compliance with current laws and regulations, potentially resulting in legal penalties and reputational damage. Here are some strategies organisations can employ to ensure their legislation registers remain current:

Regular reviews of the legislation register

Organisations should establish a routine for regularly reviewing and updating their legislation registers. This could be monthly, quarterly, or biannually, depending on the nature of the industry and the rate of legislative changes typically experienced in that sector.

Dedicated compliance team

Having a team or an individual responsible for compliance can ensure focused oversight of the legislation register. This team should have a clear understanding of the legal landscape and the organisation’s obligations and serve as an early warning system of new legislative impacts and non-compliance.

Subscription to a legal updates service

Many services provide updates on new and amended legislation. Subscribing to these can alert organisations to changes that may affect their operations and should be reflected in the legislation register.

Use of compliance software

There are compliance software solutions that automatically update legal registers with new and amended legislation. These can be particularly useful for organisations operating in multiple jurisdictions or sectors with frequent regulatory changes.  However, these software options can be expensive particularly for small companies.

Engagement with legal advisor or consultant

Regular consultations with legal advisor, such as a solicitor or barrister, or a consultant can help organisations interpret complex legislation and understand how changes impact their operations. Legal advisors and consultants can also assist in updating the legislation register accurately as well as providing practical advice on the implementation and compliance with legislation.

Training and awareness of the legislation register

Ensuring that staff are trained and aware of the importance of the legislation register can foster a culture of compliance. Staff should be encouraged to report any legal changes they become aware of in their areas of work or through trade associations or other avenues of information.

Government and Industry Resources

Utilising resources provided by government bodies and industry associations can be a valuable way of staying informed about legislative changes. These organisations often provide guidance and updates relevant to their stakeholders which supplements the actual legislation. 

Audit and verification of the legislation register

Periodic audits of the legislation register can verify its accuracy and completeness. This can be done internally or by an external auditor, providing an additional layer of assurance.

Feedback Mechanism

Implementing a feedback mechanism where employees can contribute information on legislative changes can help keep the register comprehensive and up to date.

Technology Integration

Integrating the legislation register with other organisational systems, such as risk management or enterprise resource planning (ERP) systems, can help streamline the update process and ensure consistency across the organisation.

By employing these strategies, organisations can maintain a robust approach to legal compliance and ensure their legislation registers are always reflective of the current legal requirements. This proactive stance not only safeguards against legal risks but also reinforces the organisation’s commitment to ethical business practices and corporate governance.

Legislation register support and advice

In the intricate tapestry of modern business, the legal advisor emerges as a pivotal figure, weaving through the complex threads of legislation to guide companies towards compliance and strategic success. The role of legal counsel within a company or group extends far beyond the traditional boundaries of legal advice; they are the sentinels of corporate strategy, the architects of risk management, and the harbingers of ethical business practices.

Understanding the legal landscape

The legal landscape is ever evolving, with new regulations and laws constantly shaping the business environment. Legal counsel serves as the company’s compass, navigating through these changes with foresight and expertise. By staying abreast of legislative developments, legal counsel ensures that companies not only comply with current laws but are also prepared for future amendments.

Strategic integration of compliance expertise

The integration of legal expertise into business strategy is not a mere addition but a fusion that fortifies the company’s foundation. Legal counsel scrutinises every strategic initiative, ensuring alignment with legal requirements and safeguarding against potential pitfalls. Their involvement from the inception of strategic planning is crucial, as it allows for the identification and mitigation of legal risks before they materialize.

Risk management and compliance with a legislation register

Risk management is an integral part of the legal counsel’s repertoire. Through comprehensive risk assessments, legal counsel identifies potential vulnerabilities within the company’s operations. They craft tailored compliance programs that not only address these risks but also align business operations with the relevant laws and regulations, thus minimising the likelihood of disputes and reputational damage.

Shaping corporate culture

Legal counsel also plays a vital role in shaping the company’s culture. By instilling core values and fostering a culture of integrity, legal counsel ensures that employees’ decisions resonate with the company’s ethical standards. This cultural alignment is essential for creating a positive work environment and maintaining a reputation for integrity.

The business advisor

Legal counsel often transcends their legal role to act as strategic business advisors. Their insights into the legal implications of business decisions enable them to contribute significantly to the company’s growth and strategic objectives. They are instrumental in identifying business opportunities that comply with legal standards, thus driving sustainable growth.

In conclusion, legal counsel is indispensable for companies aiming to navigate the complexities of legislation. Their strategic role in ensuring compliance, managing risks, and shaping corporate culture is invaluable. By leveraging the expertise of legal counsel, companies can secure a competitive edge, foster a culture of ethical decision-making, and achieve their strategic goals within the legal framework.

For a deeper understanding of the multifaceted role of legal counsel in business strategy, readers are encouraged to explore the insightful articles provided by industry experts.

How to find the right support for your legislation register

For any business, finding the right support for drafting and updating its legislation register is a critical step that can have a significant impact on its success and longevity. The legal landscape is fraught with complexities and ever-changing regulations that require expert navigation. Often companies will simply not have the resources to have their own legal counsel or solicitor in-house.  External solicitors, barristers and specialist consultants can provide support to companies in drafting and maintaining legislation registers.  In selecting such support, companies need to consider some important factors.

Understanding the legal requirements for a legislation register

Before embarking on the search for external support and advice, it is essential for a company to understand its legal requirements. This involves a thorough assessment of the business’s industry, the nature of its operations, and the specific legal challenges it faces. Whether it is compliance, intellectual property, labour laws, or international trade, identifying the areas where advice and support is needed will streamline the search.

Prioritising commitment and interest

When selecting external advice and support, it’s crucial to prioritise a consultant’s commitment and interest in your business. A consultant who is genuinely interested in your company will go the extra mile to understand your business model, objectives, and challenges. This commitment translates into tailored advice and proactive strategies that align with your business goals.

Matching personalities and approaches

The relationship between a company and its consultant is built on trust and communication. It is important to match a consultant’s personality and approach with the company’s culture and values. A consultant who resonates with the company’s ethos can effectively become an extension of the team, working seamlessly with other departments and stakeholders.

Seeking clear communication

Clear and understandable communication is a non-negotiable trait in consultants. Complex legal jargon can often obfuscate the real issues at hand. A consultant who can translate legislative concepts into clear, actionable advice will empower a company to make informed decisions.

Valuing adaptability and business understanding

The business world is dynamic, and your consultant must be adaptable to keep pace with changes. A consultant who understands the nuances of business and can adapt their compliance advice accordingly is invaluable. This understanding ensures that compliance strategies are not only in place but also conducive to business growth.

Ensuring scalability with growth

As a company grows, its compliance needs will evolve. It is important to consider whether the consultant can scale their services to match the company’s trajectory. A consultant who can handle the increasing complexity and volume of compliance matters as the business expands is a strategic asset.

Considering specialised expertise

Depending on the company’s industry and the nature of its compliance issues, specialised expertise may be required. Consultants with niche expertise bring a depth of knowledge and experience that can be critical for certain compliance challenges. It is worth considering whether a generalist or a specialist would better serve the company’s needs.

Finding the right fit

Ultimately, finding the right compliance consultant is about finding the right fit for the company. This involves a careful consideration of the consultant’s expertise, approach, communication style, and ability to grow with the business. By taking the time to find a consultant who aligns with these criteria, a company can establish a strong foundation for compliance support that contributes to its overall success.

Warning signs

Choosing the right consultant is a crucial decision for any individual or business. The quality of compliance advice can significantly influence the outcome of enforcement matters and the overall success of a company. However, not all consultants are created equal, and it is important to be aware of potential red flags that could indicate a consultant may not be the best fit for your needs.

Lack of specialisation

Compliance is a vast field with numerous subfields, each requiring specific knowledge and experience. A consultant who lacks specialisation in the area relevant to your business may not have the depth of knowledge necessary to provide effective advice. It is essential to choose a consultant with a proven track record in the specific area of your business.

Poor communication

Effective communication is the foundation of a successful consultant-client relationship. Be cautious of compliance consultants who are slow to respond to inquiries or vague in their responses. Consistent, clear, and timely communication is key to ensuring that you are informed and comfortable with the progress of your compliance matters.

Overpromising

Be wary of consultants who guarantee specific outcomes or make promises that seem too good to be true. Compliance processes are often unpredictable, and no ethical consultant can assure a particular result. Overpromising may be a sign of inexperience or a lack of honesty.

Fee structure ambiguity

Transparency in billing practices is critical. If a consultant is not clear about their fees or avoids discussing costs until after they have started advising you, this is a red flag. A trustworthy consultant will be upfront about their fee structure, including hourly rates, flat fees, or retainers.

Negative reviews

Researching a consultant’s reputation is an important step. Negative reviews can indicate past issues with clients or unethical behaviour. While one negative review may not be cause for concern, a pattern of dissatisfaction from clients should raise alarms.

Lack of empathy or interest

Compliance in your company is important to you and the consultant you choose should treat it with the seriousness it deserves. A lack of empathy or a disinterested demeanour is not only a red flag regarding the potential quality of advice but also about the consultant-client relationship dynamic.

In conclusion, selecting the right compliance consultant requires careful consideration and due diligence. By being aware of these red flags and taking the time to thoroughly vet potential consultants, you can increase your chances of finding a compliance professional who will provide the quality representation and support you need.

If you need advice or support for your company’s compliance issues, please contact one of the Ashbrooke team.

Plan for the next emergency now!

In the United Kingdom, emergency planning is a critical aspect of business management that ensures the safety and continuity of operations in the face of unexpected events. The Civil Contingencies Act 2004, established by the UK government, provides a framework for emergency preparedness, placing responsibilities on various organisations to prepare and respond effectively to emergencies.

Category 1 Emergency Responders

Category 1 responders, such as emergency services, local authorities, and NHS bodies, are at the core of emergency response and are subject to a full set of civil protection duties. These duties include risk assessment, contingency planning, establishing emergency plans, and making information available to the public about civil protection matters. They also have the responsibility to warn, inform, and advise the public during emergencies.

Category 2 Organisations

Category 2 organisations, which include the Health and Safety Executive, transport, and utility companies, are considered ‘co-operating bodies.’ They have a lesser set of duties but play a crucial role in incidents affecting their sectors. Both Category 1 and 2 responders form local resilience forums, which facilitate coordination and cooperation at the local level.

Business

Businesses, as part of the community, have a role to play in emergency planning. Local authorities provide advice and assistance to businesses to help them develop business continuity management arrangements. This is crucial for minimizing the impact of emergencies on business operations and the economy at large.

The government’s guidance on emergency planning emphasizes the importance of preventing emergencies where possible and mitigating their effects when they occur. Businesses are encouraged to assess risks, create emergency plans, and train employees to respond to various scenarios. Additionally, businesses should consider the continuity of critical functions and the well-being of employees during an emergency.

Emergency planning

The Prepare campaign offers practical steps for individuals and businesses to prepare for emergencies. These include learning basic first aid, making a plan for escape routes, and writing down important phone numbers. Being prepared can significantly reduce the disruption caused by emergencies.

In conclusion, emergency planning in UK business is not just a legal requirement but a practical necessity. It involves a collaborative effort between the government, responder agencies, and businesses to ensure that when emergencies occur, the impact on people, property, and the environment is minimised. By following the established guidelines and taking proactive steps, businesses can contribute to a resilient community that can withstand and recover from emergencies.

Common Business Risks

Businesses, regardless of size or industry, face a multitude of risks that can impact their operations and financial stability. Identifying and managing these risks is crucial for the sustainability and growth of any enterprise. Here are some common risks that businesses should consider:

Economic Risks

Economic fluctuations can pose significant threats to businesses. Changes in market conditions, such as inflation, recession, or shifts in consumer demand, can affect sales and profitability. Companies must have robust financial planning and management strategies to navigate economic uncertainties.

Market Risks

Misjudging market demand is a common pitfall. Conducting thorough market research and understanding consumer needs are vital to ensure that products and services meet market demands. Developing a unique selling proposition can also help differentiate from competitors.

Competitive Risks

The competitive landscape can change rapidly, with new entrants or innovations disrupting the market. Businesses need to stay agile, continuously innovate, and adapt their strategies to maintain a competitive edge.

Execution Risks

Flaws in the execution of business strategies can derail even the most well-thought-out plans. Effective project management and operational efficiency are key to mitigating execution risks.

Strategic Risks

Strategic decisions, such as entering new markets or launching new products, come with inherent risks. Businesses should conduct strategic analysis and scenario planning to anticipate potential outcomes and prepare accordingly.

Compliance Risks

Regulatory environments are constantly evolving. Non-compliance with laws and regulations can lead to fines, legal action, and reputational damage. It’s essential for businesses to stay informed and compliant with relevant regulations.

Operational Risks

Operational issues, such as supply chain disruptions or system failures, can have immediate and severe impacts on business continuity. Implementing risk management processes and contingency plans can help minimise these risks.

Reputational Risks

A company’s reputation is one of its most valuable assets. Negative publicity, whether true or not, can damage a business’s brand and customer trust. Active reputation management and effective communication strategies are crucial for reputation risk management.

Cybersecurity Risks

With the increasing reliance on digital technologies, cybersecurity threats such as data breaches and cyber-attacks have become more prevalent. Investing in robust cybersecurity measures and employee training is critical for protecting sensitive information.

Climate Change Risks

The effects of climate change, including extreme weather events and regulatory changes related to environmental sustainability, can affect businesses. Developing a sustainability strategy and adapting business practices to be more environmentally friendly can mitigate these risks.

By understanding these common business risks, companies can develop comprehensive risk management strategies that protect their interests and ensure long-term success. It’s not just about avoiding risks but also about seizing opportunities that arise from a well-managed risk landscape. For more detailed insights into managing these risks, businesses can refer to specialized resources and consult with risk management experts.

Assess and prioritise

In the dynamic world of business, risk assessment and prioritization are critical processes that enable organisations to navigate uncertainties with strategic foresight. The ability to identify, evaluate, and rank risks based on their potential impact and likelihood is not just about preventing potential pitfalls; it’s about positioning a business to seize opportunities with calculated confidence.

Understanding Risk Assessment and Prioritisation for an emergency

Risk assessment is the systematic examination of all aspects of a business to identify potential risks that could threaten operational efficiency, financial stability, legal standing, and reputation. It is a proactive measure that empowers businesses to anticipate possible obstacles and devise strategies to mitigate them. This process involves not only anticipating the obvious but also uncovering hidden vulnerabilities within an organisation and the external environment it operates within.

Risk prioritisation, on the other hand, is the process of evaluating and ranking these risks to determine which ones require immediate attention and resources. This ensures that organisations focus on the most significant threats and opportunities, aligning with their strategic objectives and resource availability.

Strategies for Effective Risk Prioritisation for an emergency

Establish Clear Criteria

Define what constitutes a ‘risk‘ within your organisation and establish clear criteria for evaluation. This could include potential impact, likelihood, and the speed at which a risk could affect the organisation.

Engage Stakeholders

Involve stakeholders from various levels of the organisation in the risk assessment process. Their insights can provide a comprehensive view of the risks and help in prioritising them effectively.

Use Quantitative and Qualitative Data

Employ both quantitative and qualitative data to assess risks. Quantitative data can provide a numerical basis for risk evaluation, while qualitative data can offer context and depth to the analysis.

Implement a Risk Matrix

A risk matrix can help visualize and prioritize risks by categorising them based on their severity and likelihood. This tool is instrumental in simplifying complex information and facilitating decision-making.

Continuous Monitoring

Risk assessment is not a one-time event but an ongoing process. Continuously monitor and review risks, adapting strategies to evolving market conditions, technological advancements, and regulatory changes.

Leverage Technology

Utilise risk management software and tools to streamline the risk assessment and prioritisation process. These tools can provide real-time data, analytics, and reporting capabilities to enhance decision-making.

Conclusion

For businesses, mastering the art of risk assessment and prioritisation is essential for sustainable growth and innovation. It’s about understanding the balance between potential rewards and risks, ensuring that the business can thrive amidst uncertainties. By accurately identifying and prioritising risks, businesses are not just protecting themselves; they are setting the stage for resilience and success in an ever-evolving landscape.

Remember, prioritising risk is a continuous journey, reflecting the dynamic nature of business and the external environment. Stay vigilant, adaptable, and informed to navigate the complexities of risk management with confidence.

Risk management plan for an emergency

Creating a Risk Management Plan for an emergency: A Step-by-Step Guide

Risk management is an essential aspect of project management that involves identifying, assessing, and mitigating potential risks that could impact a project’s success. A well-crafted risk management plan (RMP) not only helps in avoiding potential threats but also ensures that the project is well-equipped to handle uncertainties. Here’s a step-by-step guide to creating a comprehensive risk management plan for your project.

Step 1: Define the Scope and Objectives of the Plan

Before you begin, clearly define the scope of your project and the objectives of your risk management plan. This will help you understand what you need to focus on and what you aim to achieve with your RMP.

Step 2: Risk Identification

Start by listing all possible risks that could affect your project. This includes both internal and external risks, ranging from operational challenges to market fluctuations. Engage your team and stakeholders in brainstorming sessions to ensure a thorough identification process.

Step 3: Risk Analysis

Once you have identified the risks, analyse each one based on its likelihood and potential impact. This will help you understand which risks are more significant and should be prioritized.

Step 4: Risk Prioritisation

Using the information from your risk analysis, prioritise the risks. A common tool for this is a risk matrix, which helps you categorize risks based on their severity and likelihood.

Step 5: Risk Mitigation Strategies

For each high-priority risk, develop mitigation strategies. These are plans that detail how you will reduce or eliminate the risk’s potential impact. Assign a responsible person or team to manage each risk.

Step 6: Risk Monitoring and Review

Risks and their potential impact can change over time. Set up a process for monitoring identified risks and reviewing them regularly. This will help you stay ahead of any changes and adjust your strategies accordingly.

Step 7: Communication Plan

Create a communication plan that outlines how and when you will communicate about risks to your team and stakeholders. This ensures everyone is informed and can react promptly if necessary.

Step 8: Approval and Implementation

Once your risk management plan is developed, seek approval from key stakeholders. After approval, implement the plan and ensure that everyone involved understands their roles and responsibilities.

Step 9: Continuous Improvement

Risk management is an ongoing process. Learn from past projects and continuously improve your RMP. This could involve updating your risk identification and analysis methods or refining your mitigation strategies.

Conclusion

A risk management plan is a living document that evolves with your project. It requires collaboration, continuous monitoring, and adaptability. By following these steps, you can create a robust RMP that prepares your project for the uncertainties ahead, ensuring a higher chance of success.

Remember, the fidelity of your risk management plan will vary depending on the nature of your project and the standard operating procedures that your organisation uses. Whether it is a detailed document or a concise outline, the key is to have a clear, actionable plan that addresses the unique risks of your project.

Risk mitigation strategies for an emergency

Risk Mitigation Strategies: Preparing for an emergency

In the ever-evolving landscape of business, risk is an inevitable companion. However, the way organisations approach these risks can significantly influence their trajectory towards success or failure. Risk mitigation strategies are essential tools that help businesses navigate uncertainties, ensuring stability and growth. This blog post delves into the common risk mitigation strategies that can safeguard an organisation’s interests.

Understanding Risk Mitigation

Risk mitigation is a proactive approach to identify, assess, and address potential threats that could adversely affect an organisation’s objectives, assets, or operations. It involves creating specific action plans aimed at reducing the likelihood or impact of these risks.

Why Risk Mitigation Matters

The importance of risk mitigation cannot be overstated. With the increasing complexity of risk events, a robust risk mitigation plan is not just a defensive measure but also a strategic advantage. It provides a clearer picture of potential obstacles, aids in strategic decision-making, and ensures business continuity in the face of disruptions.

Common Risk Mitigation Strategies for an emergency

Risk Avoidance – This strategy involves altering plans to circumvent potential risks entirely. It’s the most straightforward approach but may not always be feasible, as it could also mean missing out on opportunities.

Risk Reduction – Risk reduction strategies aim to minimize the probability or impact of a risk event. This could involve implementing safety measures, improving processes, or adopting new technologies.

Risk Transference – Transferring risk means shifting the potential impact to a third party, such as through insurance policies or outsourcing certain operations.

Risk Acceptance – Sometimes, the cost of mitigating a risk may outweigh the potential impact. In such cases, businesses may choose to accept the risk, acknowledging it as a part of their operational landscape.

Implementing Risk Mitigation Strategies

Effective risk mitigation requires a thorough understanding of the unique challenges an organization faces. It’s not a one-size-fits-all solution; strategies must be tailored to the specific needs and context of the business. Here are steps to implement these strategies:

  • Identify Risks: Understand the types of risks your business may encounter, such as competitor, economic, political, or financial risks.
  • Assess Risks: Evaluate the likelihood and potential impact of each risk.
  • Develop Action Plans: Create detailed plans for how to avoid, reduce, transfer, or accept each identified risk.
  • Monitor and Review: Continuously monitor risks and the effectiveness of your mitigation strategies, adjusting as necessary.

Risk mitigation is an integral part of strategic planning and execution. By identifying and minimizing risks, organisations can not only protect themselves from potential threats but also position themselves to seize growth opportunities. The key is to implement a dynamic and responsive risk mitigation strategy that evolves with the changing business environment.

For more detailed insights and examples on how to apply these strategies in your organization, contact one of the Ashbrooke team.

Why you need a waste audit

In this article we look at why you need a waste audit and the benefits from it. In the United Kingdom, businesses and organisations are increasingly recognising the critical role that waste audits play in their sustainability efforts. A waste audit is a detailed analysis of an entity’s waste stream, identifying what types of waste are being produced, in what quantities, and how they are being managed. This process is not only a regulatory requirement but also a step towards environmental responsibility and cost efficiency.

It is estimated that the UK generated 40.4 million tonnes of commercial and industrial (C&I) waste in 2020, of which 33.8 million tonnes (84%) was generated in England. The latest estimates for England only, indicate that C&I waste generation was around 33.9 million tonnes in 2021.

Why you need a waste audit

The UK’s stringent waste management regulations, governed by the Waste (England and Wales) Regulations 2011, mandate businesses to classify, segregate, and store waste appropriately. Waste audits provide tangible evidence of compliance with these legal requirements, helping businesses avoid potential fines and legal issues. Moreover, they ensure that Environmental Management System (EMS) certification standards are met, which can be crucial for maintaining corporate reputation and consumer trust.

Waste audit steps

Conducting a waste audit involves several steps, starting with understanding the different types of waste produced by the organisation. It is essential to set a specific time frame for the audit, ideally during a typical operational period to get an accurate representation of the waste generated. The audit can highlight inefficiencies in waste management practices and identify opportunities for reducing waste production, promoting recycling, and improving overall environmental performance.

For businesses looking to conduct a waste audit, there are resources available that provide guidance on the process. These include six-step guides that cover everything from understanding your waste to implementing changes that can reduce waste collection and disposal costs while minimising the amount of waste sent to landfills. Companies may also engage specialist consultants to undertake the audit and report on its findings.

The benefits of waste audits extend beyond regulatory compliance. They can showcase a company’s eco-friendly credentials, secure new customers, access better loans, win prestigious awards, and even cash in on selected grants. In the UK’s business landscape, being green is no longer just a trend, it is a real competitive advantage!

Waste audits are an indispensable tool for businesses aiming to improve their sustainability. They provide a systematic approach to understanding and managing waste, leading to significant environmental and financial benefits. As the country continues to strive for a greener future, waste audits will undoubtedly remain a cornerstone of corporate environmental strategy.

Common Findings in UK Waste Audits: Insights and Implications

Waste audits are a critical component of waste management strategies across the UK, providing valuable insights into the types and quantities of waste produced by businesses and organisations. These audits often reveal common trends and issues that, when addressed, can lead to significant improvements in waste management practices.

One of the most frequent findings in waste audits is the high volume of recyclable materials that are incorrectly disposed of as general waste. This not only includes common items like paper, cardboard, and plastics but also electronic waste and certain types of glass. The mismanagement of these recyclable materials not only impacts the environment but also represents a lost opportunity for businesses to reduce waste disposal costs.  More importantly, it may also be illegal and put the company at risk of prosecution by enforcement authorities such as the Environment Agency.

Another common observation is the lack of proper segregation at the source. Many businesses fail to implement effective waste separation practices, leading to contamination of recycling streams and increased processing costs. Education and training for staff on how to correctly segregate waste can mitigate this issue and enhance the efficiency of recycling programs.

Food waste is another significant component of the waste stream, often due to over-purchasing, improper storage, and lack of composting options. This not only contributes to the environmental problem of methane emissions from landfills but also represents a substantial financial loss for businesses.

In addition to these, waste audits frequently identify the presence of hazardous waste in general waste bins. This includes items like batteries, chemicals, and medical waste, which require special handling and disposal methods to prevent harm to the environment and human health.

The findings from waste audits can serve as a catalyst for change, prompting businesses to adopt more sustainable waste management practices. By addressing the common issues identified, companies can improve their operational efficiency, comply with regulatory requirements, and contribute to a more sustainable future.

For businesses looking to conduct their own waste audits, there are numerous resources and professional services available to guide them through the process. These services can provide tailored advice and solutions to help businesses optimise their waste management systems and achieve their sustainability goals.

Waste audits consistently uncover areas where businesses can improve their waste management practices. By acting on these findings, businesses can not only reduce their environmental impact but also realise financial savings and enhance their reputation as responsible corporate citizens.

Measuring the Impact of Waste Audits in UK Businesses

Businesses are increasingly aware of the importance of sustainability and waste reduction. Measuring the impact of these efforts is crucial for understanding their effectiveness and for making informed decisions on future waste management strategies.

Here are some key methods that businesses can employ to measure the impact of their waste reduction efforts:

Waste Audit Analysis

Conducting regular waste audits is a foundational step. By analysing the types and quantities of waste produced, businesses can identify key areas for reduction and track progress over time.

Recycling Rates

Monitoring the percentage of waste that is recycled is a straightforward metric. It provides insight into how much waste is being diverted from landfills and can be a strong indicator of the success of recycling programs.

Employee Engagement

Gathering feedback from employees can offer a qualitative measure of the waste reduction culture within a business. Engaged employees are more likely to follow sustainable practices and contribute to waste reduction goals.

Financial Savings

Tracking cost savings from reduced waste disposal fees can quantify the financial impact. Additionally, savings from reusing materials or selling recyclable waste can be factored into this metric.

Environmental Impact

Calculating the reduction in carbon footprint or other environmental metrics can demonstrate the broader impact of waste reduction efforts. This can include measurements like greenhouse gas emissions avoided by recycling and reusing materials.

Sustainability Reporting

Creating detailed sustainability reports that include waste reduction metrics can help businesses communicate their progress to stakeholders and customers, enhancing their reputation and potentially leading to increased business opportunities.

Waste Audit Benchmarking

Comparing waste reduction metrics against industry benchmarks or past performance can provide context for the impact of a business’s efforts. This can help set realistic goals and drive continuous improvement.

Certifications and Awards

Achieving certifications or awards for environmental performance can serve as a measure of a business’s commitment to waste reduction and sustainability. These recognitions often have criteria based on measurable waste reduction achievements.

Waste audit conclusions

The benefits of waste audits extend beyond regulatory compliance. They can showcase a company’s eco-friendly credentials, secure new customers, access better loans, win prestigious awards, and even cash in on selected grants.

By employing these methods, businesses can effectively measure the impact of their waste reduction efforts, demonstrating their commitment to sustainability and reaping the associated benefits. For more detailed guidance on implementing these measures, businesses can contact one of the Ashbrooke team.

Risk Management in the UK

Risk management is a critical aspect of any business or organisation, and in the UK, it is taken very seriously. The UK has a robust framework for risk management, guided by various institutions and regulations that ensure businesses can identify, assess, and mitigate risks effectively.

The Institute of Risk Management (IRM) is a leading body in the UK that provides internationally recognised qualifications, training, and research in risk management. Their commitment to developing risk management professionals is evident through their extensive resources and events that cater to enhancing skills and knowledge in the field.

The UK government also plays a significant role in establishing risk management principles. The “Orange Book” is a guidance document published by the Government Finance Function and HM Treasury, which lays out the concepts and processes for risk management in government organizations. It complements other publications, such as the “Green Book”, which offers advice on appraisal and evaluation.

Moreover, the Management of Health and Safety at Work Regulations 1999 outlines the minimum requirements for risk assessment in the workplace. It mandates the identification of potential hazards, the evaluation of the likelihood and severity of harm, and the implementation of measures to control or eliminate risks.

The private sector in the UK is also bustling with companies specialising in risk management. These organisations offer a range of services, from consultancy to software solutions, helping businesses navigate the complexities of risk in various industries.

Risk management

In conclusion, risk management in the UK is a multifaceted discipline supported by a strong institutional framework, government regulations, and a dynamic private sector. Whether it’s for public or private entities, the resources and expertise available within the UK provide a solid foundation for managing risks and safeguarding the interests of stakeholders.  With the right approach and tools, organisations can turn risks into opportunities for growth and resilience.

Risk Management Top 10 for 2024

Common Risks Faced by UK Businesses: Navigating the Challenges of 2024

In the ever-evolving landscape of the business world, UK companies face a myriad of risks that can impact their operations and bottom line. As we delve into 2024, it is crucial for businesses to stay informed about the potential challenges they may encounter. Here’s an overview of the common risks that UK businesses are currently facing:

Cyber Incidents

Cybersecurity remains a top concern for UK businesses, with cyber incidents such as cybercrime, IT network disruptions, malware, ransomware, and data breaches leading the list of risks. The sophistication of cyber threats continues to grow, with hackers leveraging new technologies to exploit vulnerabilities. The rise of artificial intelligence (AI)-powered attacks has made it imperative for businesses to bolster their cyber defences and remain vigilant against these evolving threats

Business Interruption

Business interruption, including supply chain disruptions, holds the second spot on the risk list. The UK’s recent history with Brexit and the COVID-19 pandemic has highlighted the importance of business resilience. Companies must navigate import/export costs, cash-flow challenges, staff shortages, and the ripple effects of global events on their supply chains.

Natural Catastrophes

Climbing up the risk ladder, natural catastrophes such as storms, floods, earthquakes, and wildfires pose significant threats. Extreme weather events underscore the need for robust disaster recovery plans and insurance coverage to mitigate the financial and operational impacts of such incidents.

Shortage of Skilled Workforce

The scarcity of skilled professionals is a growing concern, affecting businesses’ ability to maintain productivity and innovation. This risk calls for strategic workforce planning and investment in training and development to bridge the skills gap.

Climate Change

The physical, operational, and financial risks associated with global warming continue to be a pressing issue. With climate change moving up the risk rankings, businesses must integrate sustainability into their core strategies and adapt to the changing regulatory landscape.

Political Risks and Violence

Political instability, terrorism, and civil unrest can disrupt business operations and pose security challenges. Companies must be prepared to respond to political risks and ensure the safety of their assets and personnel.

Legislative and Regulatory Changes

Changes in legislation and regulation, such as tariffs, economic sanctions, and protectionism, can have far-reaching effects on businesses. Staying abreast of legal developments and maintaining compliance is essential for operating within the law.

Macro-economic Developments

Economic shifts, including inflation, deflation, and monetary policies, can alter the business landscape. Organizations must be agile and ready to adjust their strategies in response to macro-economic changes.

New Technologies

The advent of new technologies brings both opportunities and risks. Innovations like AI, autonomous vehicles, and the Metaverse can transform industries, but they also introduce new challenges that businesses must navigate.

Market Developments

Lastly, market developments such as intensified competition, mergers and acquisitions, and market fluctuations require businesses to be competitive and adaptable to sustain growth and success.

In conclusion, UK businesses must adopt a proactive approach to risk management, staying informed and prepared for the diverse range of risks they face. By understanding these common risks and implementing effective strategies to address them, businesses can enhance their resilience and secure a competitive edge in the marketplace.

Risk Management in practice

Managing risk is a critical aspect of business strategy, especially in a dynamic and interconnected global economy. In the UK, businesses face a variety of risks that can impact their operations, reputation, and bottom line. Understanding these risks and implementing strategies to manage them is essential for business resilience and success.

Cyber Incidents

Cyber incidents top the list of risks for UK businesses in 2024, as they did in the previous year. The digital landscape is constantly evolving, and with it, the nature of cyber threats. Businesses must stay vigilant against cybercrime, IT network disruptions, malware, ransomware, and data breaches. Investing in robust cybersecurity measures, employee training, and incident response plans is crucial. Regularly updating IT infrastructure and adopting best practices for data protection can mitigate the risk of cyber incidents.

Business Interruption

Business interruption, including supply chain disruptions, remains a significant concern. The UK’s recent history with Brexit and the COVID-19 pandemic has highlighted the importance of business continuity planning. Companies should assess their supply chain vulnerabilities and develop strategies to ensure operational resilience. This may include diversifying suppliers, stockpiling critical inventory, and establishing alternative logistics arrangements.

Natural Catastrophes

The emergence of natural catastrophes as a top risk reflects the increasing frequency and severity of extreme weather events. Businesses should evaluate their exposure to natural disasters and consider insurance coverage as part of their risk management strategy. Additionally, developing disaster recovery plans and investing in infrastructure that can withstand extreme conditions are proactive steps businesses can take.

Shortage of Skilled Workforce

A shortage of skilled workers can hinder a business’s ability to grow and compete. To address this risk, companies should invest in training and development programs, foster a culture of continuous learning, and explore new recruitment channels. Building partnerships with educational institutions and offering apprenticeships or internships can also help bridge the skills gap.

Climate Change

The risks associated with climate change, such as physical, operational, and financial impacts, are increasingly recognized by UK businesses. Adopting sustainable practices, reducing carbon footprint, and integrating Environmental Social Governance (ESG) criteria into business operations can not only manage risk but also create opportunities for innovation and growth.

Political Risks and Violence

Political instability, terrorism, and other forms of political risk can have sudden and profound effects on businesses. Companies should monitor political developments and have contingency plans in place. Risk transfer mechanisms, such as political risk insurance, can provide financial protection against such uncertainties.

Legislative and Regulatory Changes

Changes in legislation and regulation, including tariffs and economic sanctions, can disrupt business activities. Staying informed about regulatory changes and engaging with policymakers can help businesses anticipate and adapt to new requirements. Compliance programs and legal counsel can ensure that businesses navigate these changes effectively.

Macro-economic Developments

Economic conditions such as inflation, deflation, and monetary policies can impact business performance. Businesses should conduct regular economic analyses and scenario planning to prepare for macro-economic shifts. Diversifying revenue streams and maintaining financial flexibility can provide a buffer against economic turbulence.

New Technologies

The advent of new technologies, including AI and the Metaverse, presents both opportunities and risks. Businesses should evaluate the potential impact of emerging technologies on their operations and industry. Investing in research and development and staying ahead of technological trends can turn these risks into competitive advantages.

Market Developments

Finally, market developments such as intensified competition and market fluctuations require businesses to be agile and responsive. Conducting market research, fostering innovation, and maintaining strong customer relationships can help businesses stay competitive in a changing market landscape.

Conclusion

In conclusion, managing risk is an ongoing process that requires attention, resources, and strategic thinking. By understanding the top risks facing UK businesses and taking proactive steps to address them, companies can build resilience and position themselves for long-term success.

If you require risk management advice for your business, please contact one of the Ashbrooke team.

The Evolution and Importance of Corporate Governance in the UK

The importance of Corporate governance in the United Kingdom has undergone significant evolution and refinement, especially in recent years. The UK Corporate Governance Code, which sets the standards of good practice in relation to board leadership and effectiveness, remuneration, accountability, and relations with shareholders, is a testament to the UK’s commitment to maintaining the highest standards of corporate governance.

The 2018 Corporate Governance Code was updated in January 2024, following a limited consultation that focused on a number of changes. This updated 2024 Code, which applies to financial years beginning on or after 1 January 2025, reflects the UK’s adaptive approach to corporate governance, ensuring that the framework remains relevant and continues to foster an environment of trust, transparency, and accountability.

The 2024 Code is separated into five sections: Board Leadership and Company Purpose; Division of Responsibilities; Composition, Succession and Evaluation; Audit, Risk and Internal Control; and Remuneration, and it operates on a ‘comply or explain’ basis. This edition of the Code includes a small number of changes from the 2018 Code. Provision 29 now asks boards to make a declaration in relation to the effectiveness of their material internal controls. A new Principle has been included to encourage companies to report on outcomes and activities. A number of provisions have been removed related to Audit Committees as these provisions are now within the Audit Committees and the External Audit: Minimum Standard.

Importance of Corporate Governance

One of the key aspects of the UK’s corporate governance model is the ‘comply or explain’ approach. This principle requires companies to either comply with the code or explain why they have not, which allows for flexibility and acknowledges that there may be legitimate reasons for non-compliance in certain circumstances. This approach has been influential and is considered a hallmark of the UK’s corporate governance system.

The Financial Reporting Council (FRC) plays a pivotal role in maintaining and updating the UK Corporate Governance Code. The FRC’s efforts to strengthen the code, particularly in response to the government’s consultation on Restoring Trust in Audit and Corporate Governance in 2022, demonstrate a proactive stance in enhancing the quality of risk management, internal controls, and the board’s consideration of corporate governance activities to achieve strategic objectives.

The latest revisions to the code include a new principle encouraging companies to report on outcomes and activities, and a provision asking boards to make a declaration regarding the effectiveness of their material internal controls. These changes underscore the importance of not just having a set of rules but also ensuring that these rules lead to tangible outcomes that enhance corporate governance practices.

Corporate governance is not just a concern for large, publicly traded companies; it is relevant for all businesses. While the UK Corporate Governance Code is specifically applicable to companies with a premium listing on the London Stock Exchange, many other companies choose to follow the code voluntarily. Moreover, large private companies are required to disclose their corporate governance arrangements under The Companies (Miscellaneous Reporting) Regulations 2018.

The focus on the importance of corporate governance in the UK reflects a broader global trend towards greater transparency, accountability, and sustainability in business practices. As companies face increasing scrutiny from investors, regulators, and the public, the UK’s corporate governance framework serves as a model for balancing the interests of various stakeholders and ensuring long-term, sustainable success.

For more detailed information on the UK Corporate Governance Code and its application, readers can refer to the resources provided by the FRC. The evolution of corporate governance in the UK is a clear indicator of the country’s dedication to fostering robust business practices that not only promote financial stability but also contribute to more inclusive societies.

The UK Corporate Governance Code serves as a benchmark for corporate governance standards in the UK, emphasizing the importance of good practices in board leadership and company purpose, division of responsibilities, composition, succession and evaluation, audit, risk and internal control, and remuneration. The Code operates on a ‘comply or explain’ basis, which allows companies the flexibility to deviate from the Code’s provisions, provided they offer a transparent explanation for doing so.

Key principles of the UK Corporate Governance Code

  1. Board Leadership and Company Purpose: The board should promote the purpose of the company, ensure that the company’s values and strategy are aligned with its culture, and meet its responsibilities to shareholders and stakeholders alike.
  2. Division of Responsibilities: There should be a clear division of responsibilities at the head of the company, ensuring a balance of authority and no individual has unfettered powers.
  3. Composition, Succession, and Evaluation: Boards should be composed of an effective combination of skills, experience, independence, and knowledge of the company to enable them to discharge their duties and responsibilities effectively.
  4. Audit, Risk, and Internal Control: The board should present a fair, balanced, and understandable assessment of the company’s position and prospects and maintain a sound system of risk management and internal control.
  5. Remuneration: Executive remuneration should be aligned to the long-term success of the company and its values, and should be designed to promote effective risk management.

These principles are designed to foster trust and transparency between companies and their stakeholders, ensuring the long-term sustainability and success of businesses within the UK’s market economy. For a more comprehensive understanding of the Code and its provisions, the Financial Reporting Council’s official documentation provides detailed guidance.

The ‘comply or explain’ approach is a cornerstone of the UK Corporate Governance Code, offering flexibility and promoting transparency in how companies apply the principles of the code. This approach allows companies to either adhere to the code’s provisions or, if they do not, to provide a clear explanation for their non-compliance.

How companies typically comply with the code

This is how companies typically comply with the code:

  1. Adherence to Provisions: Companies start by striving to comply with the provisions of the code as closely as possible. This involves aligning their corporate governance practices with the recommendations set out in the code.
  2. Disclosure: If a company chooses not to follow a specific provision, it must disclose this fact in its annual report and accounts. The disclosure is not merely a statement of non-compliance but should include a reasoned explanation.
  3. Explanation of Non-Compliance: The explanation should provide shareholders with a clear understanding of why the company has chosen a different path. This might include describing the context, the specific circumstances of the company, and how alternative measures are consistent with the overarching principles of the code.
  4. Engagement with Shareholders: Companies often engage with their shareholders to discuss governance arrangements, especially when deviating from the code’s provisions. This engagement is crucial for maintaining shareholder trust and support.
  5. Review and Monitoring: Companies regularly review their governance practices against the code’s provisions. This ongoing process helps ensure that their practices remain appropriate and effective over time.
  6. Reporting Outcomes: The updated 2024 Code encourages companies to report on outcomes and activities, which means that companies are expected to provide insights into how their governance practices have impacted their performance and strategy.

The ‘comply or explain’ approach is not about rigidly following rules but about ensuring that companies have governance frameworks that are most effective for their particular circumstances. It recognizes that one size does not fit all and that companies can be successful with different governance models, provided they are transparent about their practices and the reasons for any deviations from the standard code.

For more detailed insights into how companies apply the ‘comply or explain’ approach, the Financial Reporting Council’s website offers a wealth of information and guidance.

Example

An ‘explain’ statement is a key feature of the UK Corporate Governance Code’s ‘comply or explain’ approach. It allows a company to articulate its reasons for deviating from a specific provision of the Code. Here is a hypothetical example of what such a statement might look like:

To our shareholders,

In accordance with the UK Corporate Governance Code, we present our ‘explain’ statement concerning our deviation from Provision 18, which relates to the composition of the Audit Committee.

As per the Code, the Audit Committee should comprise at least three independent non-executive directors. However, our company has appointed only two independent non-executive directors to this committee during the reported period.

The decision to operate with a smaller Audit Committee was made in the context of our company’s current stage of development and the specific challenges we faced over the past year. Given the specialized nature of our industry and the scarcity of individuals with the requisite expertise, we found it challenging to recruit additional directors who met the independence criteria without compromising the necessary industry experience.

We believe that the current members of the Audit Committee possess a deep understanding of the sector and the complex financial mechanisms relevant to our business. Their expertise has been invaluable in navigating the intricate issues we encountered, which were exacerbated by the unique economic pressures of the past year.

We have taken measures to mitigate the risks associated with having fewer members on the Audit Committee. These include the implementation of additional oversight mechanisms and the engagement of external advisors to assist the committee in its duties.

Our commitment to good corporate governance remains steadfast, and we continue to seek qualified candidates to expand the Audit Committee. We anticipate resolving this deviation from the Code’s provisions in the upcoming financial year.

We appreciate our shareholders’ understanding and are open to engaging further on this matter.

This example illustrates how a company might explain its reasons for not complying with a particular provision of the Code. The statement provides context, justifies the company’s decision, outlines the mitigating actions taken, and indicates a commitment to aligning with the Code’s provisions in the future. It’s important to note that each ‘explain’ statement will be unique to the company’s circumstances and should be crafted to provide shareholders with a clear and comprehensive understanding of the situation.

Importance of Corporate Governance and the Shareholders’ Response

Shareholders’ responses to ‘explain’ statements in the context of the UK Corporate Governance Code can vary, but they generally expect clear and rational explanations for any deviations from the code. The ‘comply or explain’ approach is designed to foster an environment of transparency and accountability, allowing shareholders to understand the reasons behind a company’s governance choices.

When a company provides an ‘explain’ statement, shareholders typically:

  • Evaluate the Explanation: Shareholders assess the explanation provided to determine if it is reasonable and justifiable given the company’s specific circumstances.
  • Engage in Constructive Dialogue: Investors may engage in discussions with the company to better understand their governance practices and the rationale behind not complying with certain provisions of the code
  • Consider Company’s Individual Circumstances: Shareholders and their advisors are encouraged to consider the company’s unique situation when evaluating ‘explain’ statements, rather than adopting a one-size-fits-all approach to corporate governance.
  • Exercise Voting Rights: Shareholders may use their voting rights at annual general meetings to express their approval or disapproval of the company’s governance practices.
  • Seek Additional Information: If the explanation is not satisfactory, shareholders may request further information or clarification from the company’s board.
  • Monitor Company’s Performance: Shareholders often monitor the company’s performance to ensure that the alternative governance arrangements are effective and do not adversely affect the company’s long-term success.
  • Use Stewardship Code as a Guide: In line with the UK Stewardship Code, investors should engage constructively and discuss any departures from recommended practice with the company.

It’s important to note that while some investors may accept well-reasoned explanations, others may view deviations from the code more critically, especially if they believe it could negatively impact the company’s performance or governance standards. In some cases, persistent non-compliance without satisfactory explanations can lead to shareholder activism or a loss of investor confidence.

Ultimately, the effectiveness of the ‘comply or explain’ approach hinges on the quality of the explanations provided and the active engagement of shareholders in the governance process. Companies are encouraged to be as transparent and detailed as possible in their explanations to maintain trust and support from their investors.

If you require advice on corporate governance, contact one of the Ashbrooke team.

All you need to know about permit management systems

If you operate a waste management facility your environmental permit requires you to have a written management system in place and in this article all you need to know about permit management systems, we explain what you need. A management system is simply a set of procedures describing what you will do to minimise the risk of pollution from the activities covered by your environmental permit.

If you have a waste permit that was granted before 6 April 2008 that does not require you to have a working plan or management system, you will still need to manage and operate your waste activity in line with a written management system.  If you are applying for:

  • a standard rules permit, the risks are identified in the generic risk assessment
  • a bespoke permit, you will have identified the risks by carrying out your risk assessment
All you need to know about permit management systems
ISO 14001, BS 8555, EMAS: Which system is best for your business?

All you need to know about permit management systems

Your risk assessment will be part of your management system.  You must submit a summary of your management system as part of your application if you are applying for a bespoke permit. You do not need to do this if you submit a B6.5 or B6.6 application form for a standalone water discharge or a groundwater activity, but you must have your management system in place before you start operating.

You do not have to submit a summary of your management system if you are applying for standard rules permits, but you must have your management system in place before you start operating.  Your management system will normally be reviewed on the pre-operation site visit by an officer from the Environment Agency.

Where you are applying for a standard rules permit for waste activities and plan to store combustible waste, you will need to submit a fire prevention plan as part of your application.  Our consultants can provide advice and support in developing a fire prevention plan and have successfully submitted many plans on behalf of clients which have been approved by the Environment Agency.  If you require advice and support with your fire prevention plan, please contact one of the Ashbrooke team.

Once you are operating you must implement your management system, or you will be in breach of your permit.

What to put in your permit management system and how to organise it

The amount of information you will need in your management system will depend on how complicated and risky your activities are.  If your permit is for low-risk activities, for example a small sewage treatment works, your management system can be simple.  If you have a number of permits they may be covered by an overall management system. You may carry out certain things in the same way at different permitted sites and you may also have site specific procedures.

You need to be able to explain to the regulator what happens at each site and which parts of the overall management system apply to each facility. For example, at some sites you may need to show you are carrying out additional measures to prevent pollution because they are nearer to sensitive locations than others.  Our consultants recently supported a client who was near to a site of special scientific interest (SSSI) which required additional measures in both the management system and the fire prevention plan. 

How to develop your permit management system

You can develop and maintain your own management system or use an environmental management system scheme or standard.

If you have a larger site or carry out a more complex activity (like installations and waste operations dealing with hazardous waste), the Environment Agency prefers management systems based on a recognised standard and independently checked by an accredited body.

An environmental management system may be certified against a standard such as ISO 14001. The organisation or individual carrying out certification may be accredited by a National Accreditation Body such as the UK Accreditation Service (UKAS).

Using an accredited certified management system is not a guarantee that you will meet all of your permit conditions. You are still responsible for implementing your system effectively and making sure you comply with each permit condition.  This is where our consultants can provide value to your operations in ensuring that any system is relevant to your permit operation and is efficient and effective. 

However, the independent checks carried out for an accredited certified scheme or standard should result in greater confidence in your management system, and in your management of compliance. This may lead to fewer checks from the Environment Agency under the operator and performance risk assessment methodology (OPRA).  Independent inspections and audits will also provide some assurance to the company board and senior managers that procedures are implemented and being followed in practice.

When applying for an environmental permit you will need to detail on the application form if you are using any of the following as the basis for your management system:

Prepare your permit site infrastructure plan

If you are applying for a permit for a standalone water discharge activity or a point source standalone groundwater activity, you only need to read the section on ‘Water discharge and groundwater activity’.

Your management system must include a plan of your site, drawn to scale.  The plan must highlight where you do the activities covered by your permits (and any exemptions you have registered).  The plan can become incredibly detailed as the regulator lists all the features which must be included.  Often you may need to produce a number of plans in order to include all the features that are required. 

Waste, installations and mining waste permits

So far in this article, all you need to know about permit management systems, we have looks at the general requirements of a system.  However, there are some specific requirements for waste installations and mining permits.  In these cases your plan must also show any:

  • buildings, and other main constructions, like treatment plants, incinerators, storage silos and security fences
  • storage facilities for hazardous materials like oil and fuel tanks, chemical stores, waste materials
  • location of items for use in accidents and emergencies, like absorbants for chemical spills
  • entrances and exits that can be used by emergency services
  • points designed to control pollution, for example inspection or monitoring points
  • trade effluent or sewage effluent treatment plants
  • effluent discharge points
  • land that you believe is contaminated, for example areas of your site that have previously been used for industrial purposes

Permit sites near vulnerable locations

Your plan must also show areas particularly vulnerable to pollution that are on or near to your site, for example:

  • rivers or streams
  • groundwater used for drinking water
  • residential, commercial or industrial premises
  • areas where wildlife is vulnerable or protected

Use the Environment Agency’s risk assessment guide to help you think about areas that are vulnerable to pollution.  If having read this all you need to know about permit management systems article you are unsure what to include, our consultants can provide further advice and support. 

Drainage

The plan must show your foul and combined drainage facilities marked in red and your surface water drainage, facilities marked in blue.

It must also show:

  • the direction of flow of the water in the drain
  • the location of discharge points to the sewer, watercourse or soakaway
  • the location of manhole covers and drains
  • the location of stop and diverter valves and interceptors

Water, gas, electricity

Your plan must show the location of mains water, gas and electricity supplies on your site, including:

  • the mains water stop tap
  • gas and electric isolating valves and switches
  • the routes for gas, electricity and water supplies around your site – electric wiring and gas and water pipes must be labelled on the plan

Water discharge and groundwater activity

If you are applying for a permit for a standalone water discharge activity or a point source standalone groundwater activity your site plan must show:

  • your wastewater treatment plant
  • monitoring points – the locations from which you will take samples to check for contaminants or pollutant substances as required by your permit
  • the location of emergency equipment
  • the location of any mitigation measures referred to in your management system
  • the outlet to surface water (standalone water discharges only)
  • the infiltration system (standalone groundwater activity only)

If you are applying for a permit for a standalone groundwater activity where you are land spreading, your site plan must show:

  • the field locations for spreading
  • monitoring points – the locations from which you will check your discharge for contaminants or pollutant substances as required by your permit
  • the location of emergency equipment
  • the locations of any pollutant storage areas linked to your permit

Permit site operations

As a permit holder, you must break down the operations that will be carried out on your site during start up, normal operation and shut down, into a list of activities and processes, for example unloading waste, storing waste, incinerating waste.

For waste, mining waste, and installations, you should list the wastes that will be produced by each activity or process.

Finally, list the steps you will take to prevent or minimise risks to the environment from each activity or process and type of waste. Be specific about the actions you will carry out to do this.

For water discharge and point source groundwater activities, this will normally be the operation of a wastewater treatment works or effluent treatment equipment that is part of your activity and included in the permit.

If you manage, treat or dispose of waste

If you are a waste operator you must include a waste storage plan that states:

  • the longest amount of time that you will store each type of waste
  • how you will make sure you will not exceed these time limits – you need to consider your emissions when deciding how long you can store types of waste for
  • the maximum amount of each type of waste you will store in terms of volume
  • the maximum height of each storage pile on site
  • how you will identify the specific types of waste you are storing
  • how you will separate different types of waste if required, for example how far apart you will keep waste types that cannot be mixed
  • how you will make sure your site only takes waste that your permit allows you to store

Fire prevention plans

If you need a permit for waste activities and you plan to store combustible waste, you will need to write a fire prevention plan and submit it with your application. This must explain how you would prevent fire at your site or manage risks from fire if one occurs.  You should note that following the increase in waste facility fires in recent years, the Environment Agency has significantly strengthened its guidance on fire prevention plans and any plan submitted for approval must be robust. 

The regulator also charged an assessment fee per hour where existing permit operators need to produce a fire prevention plan.  If plans are not approved on the first submission, the costs can increase significantly as the regulator re-assesses each version submitted for approval. 

Our consultants can provide advice and support in developing a fire prevention plan and have successfully submitted many plans on behalf of clients which have been approved by the Environment Agency.  If you require advice and support with your fire prevention plan please contact one of the Ashbrooke team.

Site and equipment maintenance plan

You need a plan for how you will maintain the infrastructure of your site and any machinery.

You must maintain any machinery according to the manufacturers’ or suppliers’ recommendations (for example, following the instructions and guidelines of any manuals that came with your equipment).  The maintenance plan is also referred to as a maintenance schedule.

You will need to record each time you carry out maintenance, for example, each time you check the calibration of monitoring equipment to make sure it meets the manufacturer’s recommendations.  Records can be specific to the equipment, on a daily or weekly checklist or for very small operations, you could record maintenance tasks in a site diary.

Contingency plans

You need a plan for how you will minimise the impact on the environment of any:

  • breakdowns
  • enforced shutdowns
  • any other changes in normal operations, for example due to extreme weather

Accident prevention and management plan

You need a plan for dealing with any incidents or events that could result in a pollution or where you are not able to comply with your permit.  The plan must identify potential accidents, for example:

  • equipment breakdowns
  • enforced shutdowns
  • fires
  • vandalism
  • flooding
  • any other incident which causes an unexpected change to normal operations, such as extreme weather

For each potential incident, it must also state the:

  • likelihood of the accident happening
  • consequences of the accident happening
  • measures you’ll take to avoid the accident happening
  • measures you’ll take to minimise the impact if the accident does happen

Your accident plan must also say how you will record, investigate and respond to accidents or breaches of your permit.

Your accident plan must also include:

  • the date it was reviewed
  • when it will next be reviewed
  • a list of emergency contacts and how to reach them
  • a list of substances stored at your site, and your storage facilities
  • forms to record accidents on

Consider taking the following actions, if you think they are relevant to the operations you carry out at your site:

Online security: protect your business

You can take some simple steps to protect your business against online security threats. Good online security will help make sure your business does not cause pollution. Any pollution that does occur is your responsibility as the permit holder.

See the National Cyber Security Centre website for guidance about online security which is becoming an increased risk for many businesses. This will be particularly important where you have waste processing or environmental monitoring equipment controlled by computers. 

Contact information for the public

If you have a waste or an installation permit, you must display a notice board at or near the site entrance telling the public about the site. It must include:

  • the permit holder’s name (company name at least)
  • an emergency contact name and telephone number
  • a statement that the site is permitted by the Environment Agency
  • the permit number
  • Environment Agency telephone number 03708 506506 and the incident hotline 0800 807060 (or another number we subsequently tell you about in writing)

A notice board is optional for other permits and will depend on whether you consider that the public will need to see emergency contact information at your site.

A changing climate to consideration

The Met Office climate projections for the UK suggest that we can expect:

  • higher average temperatures – particularly in summer and winter
  • more heat waves and hot days
  • rising sea levels
  • changes in rainfall patterns and intensity
  • more storms

It is important you consider if a changing climate could affect your operations, including how this might affect your ability to comply with your permit.

Plan for negative climate impacts on how you operate now, during and after any transition to net zero. Include the associated risks to local communities and the environment. These impacts and risks may change over the lifetime of the activity.

Plan for the impacts of multiple events, such as supply chain failure and extreme weather, happening at the same time.

Plan to complete changes to ensure your operations remain resilient at stages along a climate projection of at least a 2°C global mean temperature rise by 2050. Do this by following and regularly updating your climate change risk assessment. Also, assess what further requirements may be necessary along a projected 4°C rise by 2100. You do not need to assess risks or plan actions beyond the end of the life of your activity.

To anticipate and prevent risks to local communities and to the environment, plan to test the effectiveness of your:

  • actions
  • policies
  • procedures
  • assessments

Finally, plan timely reviews and revisions in response to new information or learning.  Use the adapting to climate change: industry sector examples for your risk assessment when developing or reviewing your management system. You may also wish to follow or adopt ISO 14090:2019 and associated standards to help you to do this.

Complaints procedure

You need a procedure that records:

  • any complaints you receive in relation to activities covered by your permit (for example complaints from neighbours about noise, odour or dust from your site)
  • how you investigate those complaints
  • any actions taken as a result of complaints

Managing staff competence and training records

You need to have enough staff and resources to make sure the site is run effectively in order to comply with your permit.  Your management system needs to explain who is responsible for what procedures and who is technically competent.

For each of your managers, staff and contractors make a list of any roles they carry out that relate to activities covered by your permit.  You will also need a procedure to:

  • check your staff and contractors have taken the training or qualifications required for the work they do
  • record any training, refresher training or qualifications taken by your staff or contractors

If you have a permit for a waste, mining waste or installations permit you also need to look at legal operator and competence requirements.  Our consultants can provide on site training for staff on all aspects of environmental permit compliance and ISO 14001 requirements.  If you require training advice and support, please contact one of our team.

Keeping records

You must keep any records required by your permit. In some cases, the permit will tell you how long to keep a record for. Otherwise, you must consider how long you’ll need to keep different records for (and write this in your management system).  You must keep records to show how your management system is being implemented in line with the requirements of your permit and this guide.  You need to keep:

  • permits issued to the site
  • other legal requirements
  • your risk assessment
  • all management system plans
  • any plans required by the application or permit depending on your type of activity (for example odour management plan at waste sites)
  • all operating procedures
  • staff competence and training (for example qualifications, courses attended)
  • emissions and any other monitoring undertaken (for example water samples)
  • compliance checks, findings of investigation and actions taken
  • complaints made, findings of investigation and actions taken
  • audits of management system, findings (reports) and actions taken
  • management reviews and changes made to the management system
  • where applicable, certification audit reports and any actions carried out

You also need to include copies of your plans with your management system if:

  • your permit requires you to implement an approved plan
  • you have been asked to do this because there’s a problem at your site

If you manage, treat or dispose of waste

If you are a waste operator you must record the following for each delivery of waste to your site:

  • its quantity (weight or volume)
  • its List of Waste (LoW) Code
  • its origin (for example, the location the waste sent from)
  • the identity of the producer of the waste (for example the company name)
  • the date the waste arrives at your site
  • the date the waste was first produced, if the waste is likely to cause odour
  • any quarantined materials that are part of the delivery, and what you did with them

You must also:

Waste, mining waste or installations

If you have a permit for waste, mining waste or installations you will need to have a site condition report to record the condition of land or quality of groundwater on your site.

Keep this up to date through the life of your permit and include the following information:

  • details of any historic spills or contamination (incidents that took place before you began operating) and what was done in response to those incidents
  • evidence of the effectiveness of any measures you have taken to protect land or groundwater since you started operating

If you want to cancel (surrender) your permit, you will need to show you have taken the necessary measures to avoid any pollution risk from your activities.

You also need to show that you have returned the site to a satisfactory state. This means that the condition of land and groundwater has not deteriorated as a result of your activities.  Our consultants can provide advice and support drafting site condition plans for permit applications as well as updating condition plans for site permit surrenders.  If you require site condition plan advice and support, please contact one of our team.

Individual subject management plans

Sites for waste, mining waste or installations may have to include the following plans:

  • an odour management plan
  • an emissions management plan
  • a noise and vibration management plan
  • a pests management plan

It is also worth noting that the Environment Agency when assessing the above plans, may use different officers to assess each individual plan.  Therefore, the Agency will require odour, emissions, noise and pest plans to be separate standalone documents. Unfortunately, this does result in duplication and additional work. 

Agency permit application assessment officers could be based anywhere in England and will often not be familiar with the local area around your site, so it is important to include all relevant details. 

Jacksons can provide advice and support in drafting these types of management plans for permit applications and permit modifications.  If you require advice and support, please contact one of our team.

Review your permit management system

You must have a procedure for checking you are complying with your permit, procedures and management system. Record what checks are carried out, who did them and what action was taken.

You must review and update your management system:

  • when you make changes to your site, operations or equipment that affect the activities covered by your permit, for example if you install a new boiler
  • whenever you apply to change (‘vary’) your permit
  • after any accident, complaint or breach of your permit
  • if you encounter a new environmental problem or issue, and have implemented new control measures to control it

If you have ISO 14001, then it is a requirement to carry out a management review at set periods, often annually, in order to review your environmental objectives, the results of internal and external audits, etc.

You must keep a record of changes to your management system, particularly major changes such as:

  • a change to the maximum amount of waste stored on your site
  • a new noise screen
  • new waste treatment equipment, for example a Trommel
  • implementation of new control measures

The Environment Agency may also review your management system and make recommendations for improvements after any accident, permit breach or other incident. It may also ask you to improve your management system if it thinks you have not identified or minimised risks from pollution.  Our consultants have considerable experience in liaising with the Environment Agency on behalf of clients regarding environmental permit issues. 

Site closure

It is no longer possible to simply hand your environmental permit back when you stop operating.  You must submit an application to surrender your permit to the Environment Agency.  You will have a period of site closure from when you stop operating until you are able to cancel (surrender) your permit if you have a permit for a:

  • landfill
  • category A mining waste facility

During this time, you will need to continue to monitor emissions from your site.

You will need to submit the site closure parts of the site condition report when you stop operating.

Make sure people understand what you do

Your staff must have access to and understand any sections of the management system that deal with activities they carry out. It is up to you how you do this, for example whether you print the system out, or provide electronic copies.

You must be able to show the Environment Agency your management system if asked. If you have an overarching management system for a number of sites, you can provide both:

  • an overview or summary of the whole system
  • copies of the sections that relate to the activity type or aspect of the management system that the Environment Agency has asked about

Consider whether you need to provide information to interested parties such as neighbours and your local community to explain how you manage your activities to comply with your permit.

Conclusion

If you operate a waste management facility your environmental permit requires you to have a written management system in place and in this article all you need to know about permit management systems, we explain what you need. A management system is simply a set of procedures describing what you will do to minimise the risk of pollution from the activities covered by your environmental permit.

If you are applying for an environmental permit, you will need to detail on the application form if you are using any of the recognised standards as the basis for your management system.  If you have a larger site or carry out a more complex activity (like installations and waste operations dealing with hazardous waste), the Environment Agency prefers management systems based on a recognised standard and independently checked by an accredited body.

The management system must include all the elements detailed in the Environment Agency’s guidance as well as separate plans and drawings to support the permit application. If you require advice and support with your permit application or modification, please contact one of the Ashbrooke team.

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Corporate governance has been a major topic in recent years following the economic crisis and various financial scandals.  For companies it is important to have corporate governance in place to ensure that the management team operates the company in the best interests of shareholders and other stakeholders – for listed companies there are detailed rules to follow. 

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