A very happy new year to all of our social housing clients.
To set you on the right track for January, here’s our monthly snapshot of key changes and current affairs for company secretaries working in social housing.
Government launches consultations to crack down on company fraud and improve corporate transparency
On the 9 December 2020 the Government unveiled three new consultations aimed at combatting fraud and increasing confidence in the quality and accuracy of information held on the Companies House register.
Under the new proposals:
- The identity of directors will need to be verified before they can be appointed
- There will be an expansion of the Registrar’s powers so that they can query, investigate and remove false or inaccurate information
- There is a drive to improve the quality of data on the Companies House register by making the filing process more consistent
- Companies House will become fully digital
- Only companies whose boards comprise of natural persons (i.e. individuals) with verified identities will be allowed to act as corporate directors of other companies.
You can find the consultations here:
- Improving the quality and value of financial information on the UK companies register
- Powers of the registrar
- Implementing the ban on corporate directors
Company secretaries should note that as part of the reforms that are introduced Companies House will continue to look for ways to make access to its services as smooth, quick and efficient as possible.
Whilst the proposals are welcome it is worth reviewing and familiarising yourselves with the detail, and considering the impact on your group and its current processes. For example, you may need to adjust the way in which you sign off accounts and other electronic filings to ensure accuracy and appropriate authorisations are obtained. You may also need to consider any corporate directorships held by community benefit societies within the group (for example, in management companies) and how these will be impacted by the proposals (it may be possible to provide evidence to Companies House that the board has met equivalent ID requirements but this is not yet clear).
Charity Governance Code – refreshed 2020 version
A refreshed version of the Charity Governance Code was published on the 7 December 2020.
Whilst most associations will adopt the National Housing Federation Code, it is notable that many of the updates to the charity code reflect key themes arising from the 2020 Code as well as the UK Corporate Governance Code. These include:
- Refreshed Equality, Diversity and Inclusion (EDI) Principle which recommends four stages of good practice for charities
- Updates to the Integrity Principle which emphasise the importance of a charity’s values, ethics and culture, and
- The right of everyone who has contact with the charity to be safe.
The changes emphasise these areas as evolving (albeit not new) governance priorities. This will be particularly important for smaller associations whether they are assessing whether to adopt the new NHF Code, but it is worth reviewing the new Code irrespective of the size of your organisation as it is generally helpful for company secretaries to understand other codes of governance.
Housing Ombudsman publishes performance data on landlords
The Housing Ombudsman Service has expanded its landlord search to include performance data about individual landlords. This service is to help with the Ombudsman’s commitment to openness and transparency to provide residents with more information and insight.
This report features all landlords in their scheme with complaints recorded in 2019-2020 and each report shows:
- the categories of the enquiries and complaints received
- the outcomes of decisions
- the types of orders made for landlords to put things right, and
- the timeliness of landlord compliance with orders.
If none of the above were recorded against a landlord during 2019-2020, then a report has not been generated.
Whilst not necessarily directly within the company secretary’s remit, it is worth being aware of this and engaging with the relevant executive director to understand how this will feed in to any existing monitoring undertaken in relation to the Regulator of Social Housing’s regulatory judgements, for example.
Whilst it is unlikely that the regulatory changes proposed by the Social Housing White Paper will be in place imminently, monitoring the way in which both the Regulator and the Housing Ombudsman are dealing with resident complaints will be helpful to understand direction of travel.
Restrictions on winding-up petitions and winding-up orders extended to 31 March 2021
The Corporate Insolvency and Governance Act 2020 (Coronavirus) (Extension of the Relevant Period) (No 2) Regulations 2020 (the Regulations) came into force on 31 December 2020. The Regulations extend the existing restrictions on winding-up petitions and orders until 31 March 2021.
The most relevant are the following:
- A blanket restriction on presenting winding-up petitions based on statutory demands served on or after 27 April 2020, and
- In order for a creditor to present a winding-up petition on the grounds of a company's inability to pay its debts the creditor would need to have reasonable grounds for believing that coronavirus has not had a financial effect on the company or that the debt issues would have arisen anyway.
Look out for:
- The inaugural Senior Independent Directors networking event on 12 January, organised with Savills – let us know if your SID is interested in attending
- Invitations to our 'Practical Guide to ESG' roundtable with David Tolson Partnerships in February. Sarah Greenhalgh is also speaking as part of a panel on the same topic at the NHF Board Excellence Conference on 27 January
- Invitations to our ‘Essential legal updates’ seminar in February
- Our Governance Spotlight series on the NHF Code of Governance including a final spotlight on resident and customer engagement and the Social Housing White Paper (to be published later in January), and a blog by Sarah Greenhalgh for the NHF
2021 is set to be as busy as ever for the sector and we are currently putting together our seminar programme for the year – any feedback on what you would find helpful is always welcome.