The Wates Principles were developed in 2018 to meet a new legislative requirement for large private companies (those with either more than 2,000 employees and/or a turnover of more than £200m and a balance sheet of more than £2bn) to adopt a corporate governance code.  

On 12 August 2024, the Financial Reporting Council (FRC) issued its second report on whether such reporting is effective in practice.

Some highlights of the report were:

• While there is an improving trend on the quality of disclosures, companies should resist using boilerplate, or copying text from previous years' reports or from reports of similar businesses.
• More work is needed on making effective disclosure of a company's purpose and connecting that purpose to strategy, culture and values. Companies are urged to give examples of board decisions and how they link to the company's purpose and strategy. For example, ESG commitment could be illustrated by stating how the company has delivered on its pledge to be carbon neutral and the means for achieving it. 
• Companies could do better at linking how they remunerate employees with purpose, strategy and values, and disclose more information when detailing directors' remuneration in the light of workforce pay.  

The report concludes by noting the value that high quality corporate governance statements give to a range of stakeholders, and urges companies to improve reporting and demonstrate good practice going forward.

Large private companies continue to favour Wates Principles (frc.org.uk)