The UK Stewardship Code 2026, published by the Financial Reporting Council (FRC) and effective from 1 January 2026, sets a refreshed standard for responsible investment stewardship in the UK. It applies to asset owners, asset managers, and service providers such as proxy advisors, investment consultants, and engagement providers.

The Code establishes principles, disclosures, and reporting requirements designed to strengthen transparency, accountability, and the responsible allocation of capital. By focusing on systemic risks, governance, and long-term value creation, the 2026 update builds on earlier versions of the Code (2010 and 2020) to reflect the realities of today’s investment landscape – from multi-asset strategies to index-based investing.

Being a signatory to the UK Stewardship Code 2026 demonstrates a clear commitment to stewardship, backed by transparent reporting reviewed independently by the FRC.

Introduction: Why Stewardship Matters

Stewardship helps investors deliver returns today without compromising the ability to deliver in the future. It requires consideration of:

• Governance factors
• Environmental and social risks (including climate change)
• Systemic risks and market integrity
• Beneficiaries’ long-term interests

Being a signatory to the Code demonstrates an organisation’s commitment to stewardship, backed by transparent reporting reviewed by the FRC as an independent body.

Structure of Reporting

To become a signatory, organisations must submit two types of disclosures:

1. Policy and Context Disclosure
   • Submitted every four years (or when materially changed).
   • Provides factual background: organisation, governance, investment beliefs, stewardship policies.
2. Activities and Outcomes Report
   • Submitted annually.
   • Demonstrates stewardship activities over the year and their outcomes, including case studies, setbacks,
           and lessons learned.

Both documents must be approved by the governing body and signed by the Chair, CEO, or CIO.

Disclosures for Asset Owners & Asset Managers

Signatories are expected to disclose the following:

• A. Organisation, investment beliefs and stewardship approach
• B. Governance and resources
• C. Policies, processes and review
• D. Conflicts of interest
• E. Dialogue with clients and/or beneficiaries

Principles for Asset Owners & Asset Managers

The Code sets out six principles for asset owners and managers:

Disclosures for Service Providers

Service providers – such as proxy advisors, investment consultants, and engagement service providers – must disclose:

• A. Organisation and services
• B. Governance and resources
• C. Policies, processes and review
• D. Conflicts of interest

Principles for Service Providers

The Code sets out four principles for service providers:

Approach to Reporting

The Code requires reports to be:

• Fair, balanced, and understandable
• Engaging, succinct, and in plain English
• Supported by case studies, data, tables, and diagrams where possible
• Inclusive of successes and setbacks, with progress tracked across multiple reporting periods

Application Guidance

• All signatories must report on Principles 1, 2, and 6.
• Direct managers of assets should also report on Principles 3 and 4.
• Organisations using external managers should report on Principle 5, and also on 3 and 4 if they retain
        some engagement/voting rights.
• Service providers should apply the principles relevant to the services they provide (e.g., proxy advisors to
       Principle 2, consultants to Principle 3).

Stewardship in Practice

Signatories are expected to demonstrate how they:

• Address systemic risks (e.g., climate, market-wide shocks).
• Engage with issuers to achieve outcomes.
• Escalate issues when necessary.
• Exercise rights (such as voting in listed equity, or governance rights in private assets).
• Oversee external managers and providers through monitoring and accountability frameworks.

CapacityHive Reflection

While the UK Stewardship Code 2026 applies strictly to asset owners, managers, and investment service providers, its spirit resonates more broadly. At CapacityHive, we view this as a reminder that stewardship isn’t only about capital – it’s also about how professional services firms manage their most critical resource: capacity. 

Just as the Code asks investors to demonstrate transparency, accountability, and responsibility in managing capital, audit firms can embrace a stewardship mindset when governing people, delivery models, and global capacity networks.

Frequently Asked Questions (FAQ)

❓ What is the UK Stewardship Code 2026?

The UK Stewardship Code 2026 is a set of principles and reporting requirements issued by the Financial Reporting Council (FRC). It guides asset owners, asset managers, and service providers in the responsible allocation, management, and oversight of capital to create long-term sustainable value.

Who does the Code apply to?

The Code applies to:

• Asset owners (such as pension funds, insurers, sovereign wealth funds)
• Asset managers (who invest capital directly or through external managers)
• Service providers (proxy advisors, investment consultants, engagement providers) who support investors in
       fulfilling their stewardship responsibilities.

What are the main principles for asset owners and managers?

There are six principles:

1. Integrating stewardship and investment
2. Promoting well-functioning markets
3. Engagement
4. Exercising rights and responsibilities
5. Selection and oversight of managers
6. Monitoring service providers

What are the principles for service providers?

There are four principles:

1. Communicating with clients
2. Proxy advisor services
3. Investment consultant services
4. Engagement provider services

When does the Code take effect?

The UK Stewardship Code 2026 takes effect on 1 January 2026. Organisations wishing to become or remain signatories will need to prepare their Policy and Context Disclosure and their Activities and Outcomes Report accordingly.

Conclusion

The UK Stewardship Code 2026 represents a significant evolution in responsible investment standards. It reinforces the importance of systemic risk management, transparency, accountability, and long-term value creation.

For asset owners, asset managers, and service providers, the message is clear: stewardship is no longer a side activity – it is central to fulfilling fiduciary duties, sustaining market integrity, and building trust with clients and beneficiaries.

The Code’s new reporting structure ensures signatories move beyond policy statements to tangible demonstrations of activities and outcomes, raising the bar for stewardship standards in the UK and globally.