Anglian Water is committed to meeting the highest standards of corporate governance and transparency.
In 2014 Ofwat published a set of minimum standards that it expected water companies to meet for Board leadership, transparency and governance (known as the BLTG Principles). In January 2019 Ofwat issued a revised set of BLTG Principles. The revised BLTG Principles consist of four broad objectives and a series of supporting provisions. The 2019 BLTG Principles can be found on Ofwat’s website.
In March 2019 Ofwat wrote to companies stating that it proposed to insert a new provision into the Licences of all companies (including Anglian Water) which will require companies to meet its BLTG objectives and explain in a manner that is effective, accessible and clear how companies are meeting these four objectives.
Anglian Water also has a Licence Condition which requires it to conduct its regulated business as if Anglian Water was a separate public limited company.
In July 2018, the Financial Reporting Council (“FRC”) published a revised version of the 2018 UK Corporate Governance Code (which applies to listed companies). The 2018 UK Corporate Governance Code applies to accounting periods beginning on or after 1 January 2019.
Separately, in December 2018, the FRC published the Wates Corporate Governance Principles For Large Private Companies. The Wates principles will also take effect in relation to financial years beginning on or after 1 January 2019 and will apply to all companies that have more than 2,000 employees and/or have a turnover of more than £200 million and a balance sheet total of more than £2 billion.
In response to both Ofwat’s revised BLTG Principles and to the wider changes in corporate governance referred to above, we have reviewed the AWS Code (first published in 2014) and have now produced a revised code (the 2019 Code) which was approved by the Board of Anglian Water Services on 27 March 2019. The 2019 Code incorporates Ofwat’s BLTG Principles together with most of the provisions of the 2018 UK Corporate Governance Code. We have omitted only those parts of the 2018 UK Corporate Governance Code which cannot be sensibly applied to a company in private ownership. Although compliance with the Wates principles would have been sufficient, the Board was keen to adopt more stretching corporate governance requirements where possible.
Details of compliance against the 2015 Code for the year ended 31 March 2019 is included in the Annual Integrated Report 2019. The 2019 Code came into effect on 1 April 2019 and we will report against compliance with the 2019 Code for the year ended 31 March 2020 in the Annual Integrated Report 2020. We will continue to keep the 2019 Code under review to ensure that it reflect relevant changes to UK Corporate Governance Code.
We are also considering our approach to complying with the requirements of The Companies (Miscellaneous Reporting) Regulations 2018 which apply to company reporting on financial years which begin on or after 1 January 2019 (and will therefore be considered as part of our Annual Integrated Report 2020).