Governance Flexibility, AGM Reform And Capital Access: Insights From The QCA Annual Review 2025/26

The Quoted Companies Alliance (QCA)'s Annual Review 2025/26, published on 28 August 2026, provides a useful snapshot of the governance, shareholder engagement, and capital markets issues affecting AIM and other quoted growth companies. Alongside reporting on its policy and advocacy activities, the review highlights emerging trends in application of the QCA Corporate Governance Code, evolving expectations around AGM formats, and ongoing efforts to improve access to growth capital for smaller quoted businesses. For company secretaries and governance professionals, the review offers insight into areas that may continue to influence governance practices, investor engagement, and regulatory developments.

Governance flexibility under the QCA Code

During the year, the QCA published Supporting Growth Flexibly, a review of adoption of the 2023 QCA Corporate Governance Code. The research found that 92% of AIM-quoted companies adopt the QCA Code, increasing to 97% among UK AIM companies.

The review also identified greater use of the Code's flexibility. 20% of companies reported that they did not fully apply all provisions of the Code and instead provided explanations for departures, representing approximately double the proportion identified two years earlier. The findings indicate that smaller companies are more likely to explain departures from Code provisions than larger issuers.

For company secretaries, the findings reinforce an important principle of the QCA Code: effective governance reporting is not solely about compliance with individual provisions, but also about providing clear, company-specific explanations where alternative governance arrangements are considered more appropriate. As investors and other stakeholders continue to scrutinise governance disclosures, boards may wish to ensure that any departures are well explained and supported by the company's circumstances.

AGM practices and shareholder engagement

The QCA also published Meeting-Expectations-AGMs-for-growth-companies-in-the-digital-age_QCA-research.pdf, examining how annual general meeting practices have evolved following the increased use of virtual meeting formats during and after the COVID-19 pandemic. The report highlights continuing uncertainty surrounding the legal framework for virtual and hybrid meetings and considers the costs, technology, and shareholder engagement implications associated with different meeting formats.

The QCA argues that future reform should recognise the legal status of virtual AGMs while preserving flexibility for companies to determine the most appropriate meeting format. It also suggests that shareholder consent should be required where companies seek to change their AGM format.

Although these proposals have not been implemented, they reflect an ongoing debate about how companies balance accessibility, investor participation, and operational practicality. For company secretaries responsible for planning AGMs, the discussion serves as a reminder that shareholder engagement expectations continue to evolve and that meeting arrangements remain an important area of governance consideration.

Access to capital and market reform

Access to capital remained a major area of focus during the year. Through its Banking on Britain report, the QCA examined the role of the British Business Bank in supporting quoted growth companies and advocated the creation of a £1 billion small-cap investment portfolio. The QCA argues that such an approach could help address funding gaps, improve liquidity, and support valuation levels within the smaller company sector.

The Annual Review also records a number of developments affecting UK capital markets, including changes to prospectus rules, reforms designed to facilitate greater retail investor participation, and the introduction of revised AIM Rules. The QCA welcomed the AIM reforms and highlighted measures such as a streamlined admission process, a capital access window, and revised thresholds for substantial transactions.

For boards and governance professionals, these developments form part of a broader programme of UK capital markets reform aimed at improving the attractiveness and competitiveness of public markets. While individual companies will need to assess the relevance of specific changes to their circumstances, the overall direction of travel remains focused on supporting capital formation and growth.

Policy engagement and regulatory developments

The Annual Review also summarises the QCA's engagement with policymakers, regulators, and market participants on issues affecting quoted companies. During the year, the organisation responded to consultations and participated in discussions covering sustainability reporting standards, AIM reform, takeover regulation, entrepreneur support measures, and wider economic growth initiatives. The review also notes ongoing engagement regarding corporate reporting reform and other regulatory developments.

While these activities do not themselves create new obligations for companies, they provide insight into areas where policy development and regulatory change may continue to emerge. Governance professionals may therefore find the review useful as an indicator of issues likely to remain prominent in the quoted company sector.

Conclusion

The QCA's Annual Review 2025/26 highlights three themes that are likely to remain relevant for quoted companies: increasing use of flexibility within governance frameworks, continuing debate over the future format of AGMs, and ongoing efforts to strengthen access to capital for growth businesses. Together, these developments illustrate the dynamic environment in which boards and company secretaries operate and underline the importance of maintaining effective governance, meaningful shareholder engagement, and awareness of emerging regulatory and market developments.

The full Annual Review can be accessed here: 1.6-QCA-AnnualReview-2526.pdf.pdf