The Stewardship Code is a part of UK company law concerning principles that institutional investors are expected to follow.
Its stated aim is to encourage active and engaged monitoring of corporate governance for the interests of beneficiaries.
Specifically, the Code aims to promote the responsible allocation, management, and oversight of capital to create long-term value for clients and beneficiaries leading to sustainable benefits for the economy, the environment, and society.
[1] The Code comprises a set of ‘apply and explain’ Principles for asset managers and asset owners, and a separate set of Principles for service providers (FRC Stewardship Code) The information is also sent to the Financial Reporting Council, which links to the information provided to it.
The compulsion to, at the very least, explain non-compliance with the Code follows from the Financial Services and Markets Act 2000 section 2(4) and the Listing Rules.