EQ Monthly Bulletin - May 2025

In This Edition:

• The PIRC Shareholder Voting Guidelines
• Companies House Updates
• London Stock Exchange Discussion Paper
• UK Government Update
• The FRC – PISCES
• The FCA - Primary Bulletin 55
• The FRC- Digital Reporting
• EU Artificial Intelligence Act

The PIRC Shareholder Voting Guidelines

PIRC published its Shareholder Voting Guidelines in March 2025, updated for AGMs held in 2025.

These areas are highlights of ongoing interest to investors:

• Responsibilities of the board chair: 
• Committee chairs: 
• Diversity: 
• Auditor rotation: 
• Share issue authorities: 
• Authorities to purchase own shares
• Maintenance of capital: 
• Remuneration schemes generally: 
• Managing climate risk at major emitters: 

The updated PIRC UK Shareholder Voting Guidelines can be purchased from PIRC.

Companies House Updates

On 8 April 2025, Companies House published two sets of guidance on identity verification by individuals and Authorised Corporate Service Providers (ACSPs).

Guidance for individuals:

• Lists the identity documents that can be used to complete verification online
• An individual living in the UK may be able to verify in person at a Post Office
• Individuals may ask an ACSP to verify their identity
• On receipt of a submission, Companies House will e mail an 11-character personal code to the individual that they can use to connect their verified identity to Companies House records

Guidance for ACSPs:

• ACSPs must be registered as a Companies House authorised agent
• Information the ACSP must provide about an individual
• ACSPs must tell Companies House which identity documents were used as evidence, the date checks were completed and if the documents were checked in person or by using verification technology.
• ACSPs must keep copies of all identity checks, including copy documents, for seven years
• On receipt of a submission, Companies House will e mail an 11-character personal code to the individual that they can use to connect their verified identity to Companies House records

The Guidance can be accessed on the Companies House website:  

Individuals: Verifying your identity for Companies House - GOV.UK

ACSPs: Being an Authorised Corporate Service Provider (ACSP) - GOV.UK

London Stock Exchange Discussion Paper

On 7 April 2025, the London Stock Exchange (LSE) published its Discussion Paper – Shaping the Future of AIM, seeking views on the continued development of AIM.

The Discussion Paper requests feedback on the following:

• Effectiveness of recent initiatives to increase investment and ways that the market framework could be less burdensome
• Ways in which to streamline AIM admission documents
• Whether, in certain reverse takeover circumstances, the requirement for an admissions document could be dispensed with
• Proposed changes to permitted accounting standards
• The role of the nominated adviser and ways that the AIM designated market admission route could be developed
• Adoption of a Main Market equivalent route for the admission of dual-class shares
• Exemptions to AIM Rule 13 where there are other existing shareholder safeguards and regarding directors’ remuneration
• Application of class tests

Responses are requested on or before 16 June 2025.

The Discussion Paper can be accessed via this link: Discussion Paper - Shaping the Future of AIM

UK Government Update

The Government has published the Cyber Governance Code of Practice following its call for views in 2024 and the Government’s formal response in January 2025. 

The Code forms part of the government's free package of support on cyber governance. It is published alongside Cyber Governance Training, which helps boards and directors to strengthen their understanding of how to govern cyber security risks, and the Cyber Security Toolkit for Boards, which supports boards and directors in implementing the actions set out in the Code.

The Code is voluntary however the uptake will be monitored to evaluate its effectiveness in driving improvements in how cyber risk is governed.  If uptake of the Code is limited and there are no sufficient improvements, the Department of Science, Industry and Trade has indicated it will explore other options, such as legislation.

The Cyber Governance Code of Practice and supporting documentation can be accessed via this link:  Cyber Governance Code of Practice - GOV.UK

See our Cyber Governance Code of Practice Q&A from February 2025: Cyber Governance Code of Practice – Q&A

The FRC – PISCES

On 10 April 2025, the FRC published an update on how the responses to its consultation on the regulatory framework for the Private Intermittent Securities and Capital Exchange System (PISCES) are likely to affect the final rules.

Feedback was largely supportive with no material changes anticipated.  The update details some technical changes that the FCA is considering, including:

• Various changes to the core information PISCES companies must disclose
• Making implementing rules on legitimate omissions from core disclosures optional
• Clarifying its expectation that PISCES companies may restrict participation in a trading event
• Not applying certain MAR sections to PISCES operations, providing guidance instead
• Ensuring that breaches of PISCES rules do not give rise to a right of private action under the Financial Services and Markets Act 2000

The proposals are subject to further development and approval, and any changes will be clearly identified in the final PISCES rules, expected to be published in June 2025.

The update can be viewed here: Update on PISCES and pre-application support | FCA

The FCA - Primary Bulletin 55

The FCA published its Primary Market Bulletin 55 on 17 April, 2025, detailing proposed changes to its Knowledge Base – to reflect changes in the listing regime – and a consultation on amendments to further guidance notes.

The Bulletin finalises notes that were consulted on in earlier Primary Market Bulletins as follows:

• Listing Principle 2 – dealing with the FCA in an open and cooperative manner
• Hostile takeovers
• Aggregating transactions

The consultation on amendments is for the following notes:

• Issuer’s obligations
• Periodic financial information and inside information
• Delaying disclosure / dealing with leaks and rumours
• Assessing and handling inside information
• Structured digital reporting

The consultation on the FCA notes closed on 15 May 2025.

You can access the summary of changes to the Knowledge Base here: FG25/1: Primary Market Bulletin No. 55 | FCA

The consultation on continuing technical note updates can be accessed here: GC25/1: Primary Market Bulletin No. 55 | FCA

The FRC- Digital Reporting

The FRC published its insight report on structured digital reporting on 28 April 2025.  The report is based on market-wide analysis as well as detailed analysis of 25 annual reports filed on the National Storage Mechanism.  

The following key issues are identified:

• Use of custom extensions – often created when not necessary and can cause issues when analysing reports
• Anchoring of extensions – where extensions are used but not anchored correctly, making it unclear against which IFRS item it is to be compared
• Accounting meaning – where the accounting meaning of the tags does not match the facts reported, which can cause significant discrepancies in the analysis of financial statements
• Incorrect sign or scale – sign (positive or negative), balance attribute (debit or credit) or scale (pounds or pence) can be incorrect which also causes significant errors in the analysis of financial statements
• Missing tags or granularity – mandatory tags not included or relevant level of granularity not applied, this can make it difficult for investors to find relevant information about a topic
• Design and usability – companies are not applying the same level of attention to the design and availability of their digital annual reports as to their printed / PDF annual reports

The FRC is intending to enhance its review of digital reporting alongside its normal monitoring of annual reports.  If there are significant tagging issues, a company may be contacted directly.

The full report can be accessed here: Structured digital reporting – 2024/25 insights

EU Artificial Intelligence Act

The EU Artificial Intelligence Act came into force on 1 August 2024, with most of its provisions applying from 2 August 2026, However, some of its key provisions apply earlier than this date as follows:

• Prohibited AI practices are banned outright from 2 February 2025.
• Obligations on providers and deployers regarding AI literacy apply from 2 February 2025.
• Penalties apply from 2 August 2025 (except penalties applicable to providers of General Purpose AI (GPAI) models which apply from 2 August 2026).
• Rules on GPAI models apply from 2 August 2025.

The Act’s provisions extend to entities outside the EU if their AI systems are placed on the EU market, used within the EU, or if the output produced by these systems is utilised in the EU.  This means that UK-based companies developing, deploying or offering AI systems that have any interaction with the EU market are subject to the Act’s requirements.

EU Artificial Intelligence Act | Up-to-date developments and analyses of the EU AI Act

You can read more in our article here.