The existing UK Combined Code on Corporate Governance (Combined Code), administered by the Financial Reporting Council (FRC), remains fit for purpose. The "comply or explain" approach to guidance and provisions under the Combined Code should continue to provide the basis for better corporate governance practice in BOFIs, although some provisions require amplification and better observance.

A "culture of challenge" within the boards of BOFIs, especially on decisions relating to risk, will be encouraged. To achieve this, close attention should be paid to board composition and non-executive directors (NEDs) should be expected to commit more to their role in terms of time and training. The chairman's role in all of this will be paramount.

As the core objective of a BOFI is the successful arbitrage of risk, board level engagement in the high level risk process should be materially increased. In particular, this will involve a dedicated NED to focus on risk issues in addition to, and separately from, the executive risk committee process.

There is a need for increased communication and engagement with institutional shareholders to support long-term improvement in performance. New "Principles of Stewardship" will be introduced, with which all institutions that are authorised to manage assets for others will be expected to conform on a "comply or explain" basis.

Existing board remuneration committees should be extended to cover the remuneration framework for the entire organisation, with an obligation to disclose details of the remuneration of certain high-earners. Incentive payments should be deferred. At least half of variable remuneration should be in the form of long-term incentive schemes with vesting deferred for up to five years. If the remuneration report receives less than 75% of the total votes cast, the chairman of the remuneration committee should be subject to re-election.