Companies Act 2006: Nominee Operators

Lord Naseby Excerpts

Tuesday 13th January 2015 Lords Chamber

Asked by

[Lord Naseby]

To ask Her Majesty’s Government what plans they have to review with the Financial Conduct Authority the implementation of the Companies Act 2006 in relation to nominee operators so that private shareholders with nominee accounts automatically receive reports and accounts free of charge for the companies in which they invest.

[Lord Naseby (Con)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper and, in doing so, declare an interest as a holder of some AIM shares.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Neville-Rolfe) (Con)]

My Lords, the Government are committed to encouraging better engagement between investors and companies. Indirect investors should be able to receive information from the companies in which they hold shares, if they choose to do so. We acknowledge that private investors in nominee accounts do not automatically receive such information, so we have recently commissioned research to determine how shares are currently held and what steps we might take to encourage more investor participation.

[Lord Naseby]

My noble friend’s Answer is encouraging, in that this research is being undertaken, but is she aware that the United Kingdom has the largest number of private investors anywhere in the world? Furthermore, thanks to the policy of my honourable friend in another place, those private investors can invest in AIM shares within their ISAs, which are one of the principal saving mechanisms of any family today. Against that background it is surely important that this research is done quickly, so that the holders of all shares can attend AGMs and receive the annual accounts.

[Baroness Neville-Rolfe]

My noble friend is entirely right. We expect the findings of our research by the end of March and we will therefore be able to proceed with appropriate steps quickly.