Takeover Panel: Response statement – Dual class share structures, IPOs and share buybacks (RS 2025/1)

On 2 December 2025, the UK Takeover Panel (Panel) published RS 2025/1: Dual class share structures, IPOs and share buybacks setting out final form changes to the UK Takeover Code (Code) which will:

• Introduce a framework for the application of various aspects of the Code to companies with dual class share structures.

• Introduce a specific requirement for companies to make appropriate Code disclosure in their listing documentation on IPO and to consult the Panel in relation to this as well as codifying the ability of the Panel to grant a Rule 9 dispensation by disclosure in certain circumstances.

• Make certain amendments to the Code’s provisions relating to buybacks.

The final form rules have been adopted by the Panel substantively in the form consulted on earlier this year with only minor amendments (for a summary of the consultation see here).

The new rules will take effect on 4 February 2026 (Implementation Date) and will be applied from that date to all companies and transactions to which they relate (including any ongoing transactions that straddle the Implementation Date) except where to do so would give the amendments retroactive effect.

The Panel also intends, on or before the Implementation Date, to publish two new Notes to advisers in relation to IPOs and Rule 9 waivers.

Where parties have any doubts about the consequences of the new rules, in particular their impact on any transaction which is in existence or contemplation, they should consult the Panel prior to the Implementation Date to obtain a ruling or guidance.

(Takeover Panel, RS 2025/1, 02.12.2025 and Panel Statement 2025/18, 02.12.2025)

FRC: The Wates Principles for Large Private Companies – Reporting Insights

On 3 December 2025, the Financial Reporting Council published a report to assist companies that have chosen to adopt the Wates Corporate Governance Principles for Large Private Companies in disclosing meaningful and relevant information about their corporate governance arrangements.

The FRC’s aim in publishing the report is to provide insights that are supportive and proportionate and assist companies to improve their reporting for users of reports. Building on previous assessments, the report highlights examples of good practice and offers practical guidance in relation to each of the six Wates Principles.

The FRC concludes that it is pleased to see that companies are continuing to engage with the Wates Principles, and it has seen excellent examples of reporting against specific provisions. The report is designed to help companies in the next reporting year to think more widely about the Wates Principles and the governance that they support. The FRC encourages companies to be transparent and bold in their reporting which will build trust with their stakeholders and lead to more successful organisations.

(FRC, The Wates Principles for Large Private Companies – Reporting insights, 03.12.2025 and FRC press release)

Glass Lewis: 2026 Benchmark Policy Guidelines for the UK

On 4 December 2025, Glass Lewis published its updated Benchmark Policy Guidelines that will apply to shareholder meetings in the UK held from 1 January 2026 onwards. Some changes have been made to the 2025 Guidelines, and a few clarifying amendments have also been made.

Key changes

• Approach to committee size recommendation: Glass Lewis will typically recommend shareholders vote against, rather than abstain from voting on, the re-election of the audit and/or remuneration committee chair where the committee is of an insufficient size.
• Gender diversity: As the time for achieving the FTSE Women Leaders Review targets has passed, Glass Lewis will now will typically recommend against the re-election of the nomination committee chair where the board does not comprise at least 40% gender diverse directors, absent any mitigating circumstances.
• AIM companies’ board independence: In line with the 2023 QCA Corporate Governance Code, the Guidelines have been updated to clarify that AIM companies' boards should be at least half independent and include a minimum of two independent non-executive directors. If more than half of the members are affiliated or inside directors, Glass Lewis will typically recommend a vote against one or more of the non-independent directors in order to satisfy this threshold.
• Pay for performance: The Guidelines have been updated to add a description of Glass Lewis’ new proprietary pay-for-performance model, including score ranges, the individual tests comprised in the balanced scorecard, and information on the selection of peers. It has also been clarified that, while the outcome of this model may impact the analysis of a company’s executive remuneration practices, Benchmark Policy recommendations on the remuneration report and policy proposals will continue to result from a holistic assessment of the company’s remuneration structure, disclosure and practices as a whole, as well as other relevant external factors.

Clarifying amendments

• Key committees: The Guidelines have been updated to clarify that, for the purposes of director attendance, the key committees are generally considered to be the audit, remuneration and nomination committees.
• Remuneration committee independence: The discussion on remuneration committee independence has been updated to clarify that the chair of the board should only serve on the remuneration committee if they were independent on appointment and continue to satisfy standard independence tests outside of their chair role.
• Vesting/holding periods: The “Vote on Remuneration Policy” section of the Guidelines has been updated to clarify that market practice, as outlined in the UK Corporate Governance Code and by the Investment Association, typically calls for combined vesting and holding periods of at least five years for long-term incentives. Further, long-term incentives should have a minimum three-year vesting/performance period.

(Glass Lewis, 2026 Benchmark Policy Guidelines for the UK, 04.12.2025)