Act as shareholder for, and lead establishment of, UK government arm’s length bodies
UKGI Stewardship Code Report
The UK Stewardship Code published by the Financial Reporting Council sets high expectations of those investing money on behalf of UK savers and pensioners. UKGI’s report sets out how we meet the Principles for service providers by providing effective stewardship to our portfolio of assets, acting on behalf of Departments.
10 March 2022 5 MB
UKGI paper on the use of ALBs in government: a view from practitioners
A key part of UKGI’s mission is to support departments across Whitehall to be most effective in their role as shareholders of arm’s length bodies. In this paper, published in 2020, we have drawn on our expertise across both the public and private sectors to identify how, where and why arm’s length bodies are used by government, and to define seven critical success factors for setting up and managing them. The paper is intended to help inform debate across Whitehall and beyond on the effective use of arm’s length bodies for specialised delivery, as well as to share practical know-how and expertise in this area.
HM Land Registry (HMLR)
UKGI performs the shareholder role on behalf of BEIS in relation to HMLR. HMLR plays a key role in the UK’s economic stability, security and growth. Its registers and the guarantees afforded by them underpin £7 trillion in property assets across England and Wales, with £1-1.5 trillion in lending secured against it. The Land Register, a piece of Critical National Infrastructure, contains more than 26 million titles, providing financial and economic security across the UK.
UKGI provides strategic oversight of HMLR’s corporate governance and corporate performance, working closely with and reporting directly to BEIS senior officials and BEIS Ministers.
For example, last year UKGI was responsible for advising on the appointment of non-executive members to HMLR’s Board. In practical terms, this involved leading the recruitment campaign for new non-executive Board members, engaging closely with both HMLR and BEIS throughout the process and advising BEIS Ministers for a decision. This led to the appointment of two new independent non-executive directors who strengthen the Board in terms of experience and capabilities and providing support for management to execute HMLR’s business strategy.
The Royal Mint
UK Government Investments acts as shareholder on behalf of HMT Ministers in relation to Government’s 100% shareholdings in The Royal Mint. The Royal Mint’s primary purpose is to manufacture and distribute coins for the UK, as well as to supply blanks and official medals. Since 2010, They have operated on a fully commercial basis providing goods and services to HMT via the UK Coin contract.
We discharge our role primarily through membership of the Board and certain of its committees, working with HMT and The Royal Mint to better align the governance structure with the government’s objectives for the Mint as well as further developing the medium-term strategy to remain a profitable business despite the long-term decline in cash usage.
With regards to COVID-19, the UKGI team supported The Royal Mint in its options to keep the business open and provided steers on Government support packages that are available. We are pleased to note that The Royal Mint used its engineering expertise to create and manufacture medical visors to help protect frontline care workers in the NHS.
National Nuclear Laboratory
UKGI manages BEIS’s 100% shareholding in the NNL, including providing a UKGI Shareholder NED to represent BEIS as shareholder on the NNL Board. Shareholder priorities are set out at least annually in a letter to the NNL Chair, as well as being reflected in NNL’s business plan and Key Performance Indicators. We also monitor performance against business plan and financial performance closely, and provide formal reporting on NNL’s performance to BEIS.
We are able to flex our level of engagement if needed, in order to deliver shareholder intervention which is proportionate to the circumstance. For example, during the early stages of the pandemic, owing to the increased uncertainty around impact on the business and operations, engagement between UKGI and NNL increased significantly, with UKGI working with BEIS to put in place contingency arrangements to allow NNL to access additional funding if required.
Environmental Sustainability is a key focus for NNL and UKGI is involved in active discussions, alongside NNL’s executive team, on developing NNL’s enhanced environmental strategy and approach. NNL have also accepted UKGI’s invitation to participate in a cross-Whitehall group to share best practice with other UKGI assets.
We work with NNL to continually seek improvement and evolution of NNL’s governance to reflect best practice, and delivered a full refresh of NNL’s constitutional and governance documents. These include updated articles of association and board terms of reference, as well as a new ‘Framework Document’ setting out the roles and accountabilities of NNL, including how NNL meets the standards outlined in Managing Public Money.
The public sector and state owned enterprises, wholly or partially owned, which UKGI works with are:
The British Business Bank is a government owned business development bank dedicated to making financial markets work better for small businesses.
Channel 4 is a commercially funded public sector broadcaster it operates a portfolio of channels including channel 4.
HM Land Registry registers the ownership of land and property in England and Wales and is a non-ministerial department.
Nuclear Decommissioning Authority (NDA) ensures the safe and efficient clean-up of the UK’s nuclear legacy. NDA is an executive non-departmental public body, sponsored by the Department for Business, Energy & Industrial Strategy, supported by 5 agencies and public bodies.
National Nuclear Laboratory ‘s purpose is to serve the national interest and create value for customers by pushing the boundaries of science, technology and innovation.
The Post office is the UK’s largest retail network and the largest financial services chain in the UK with more branches than all of the UK’s banks and building societies put together.
Ordnance Survey’s aim is to provide mapping that informs, guides and inspires. Its vision is to reveal our ever-changing landscape in extraordinary detail, giving the most comprehensive view of Britain.
Natwest Group is a UK-based financial services company, head-quartered in Edinburgh. NatWest Group provides a wide range of products and services to personal, commercial and large corporate and institutional customers through its two main subsidiaries, NatWest and The Royal Bank of Scotland, as well as through a number of other well-known brands including Ulster Bank and Coutts.
The Royal Mint is the world’s leading export mint, making coins and medals for an average of 60 countries every year. However, its first responsibility is to make and distribute United Kingdom coins as well as to supply blanks and official medals.
UK Export Finance is the UK’s export credit agency and a government department . It works with 70 private credit insurers and lenders to help UK companies access export finance.
UK Asset Resolution (UKAR) was established on 1 October 2010 to facilitate the orderly management of the closed mortgage books of both Bradford & Bingley and NRAM.
URENCO is an international supplier of enrichment services and fuel cycle products with its head office based close to London, UK. With plants in Germany, the Netherlands, the UK and in the USA, it operates in a pivotal area of the nuclear fuel supply chain which enables the sustainable generation of electricity for consumers around the world. Using centrifuge technology designed and developed by URENCO, the URENCO Group provides safe, cost effective and reliable uranium enrichment services for civil power generation within a framework of high environmental, social and corporate responsibility standards.
OneWeb is a global communications network, acquired by the UK Government and the Bharti Group in November 2020. Its goal is to provide an affordable, fast, high bandwidth, low-latency global communications service, powered by a constellation of 650 Low Earth Orbit satellites.
Reclaim Fund Ltd (RFL) is the UK’s operator of the Dormant Assets Scheme. Working with the financial services industry, RFL facilitates the transfer of dormant asset monies into the Scheme ensuring the original owner’s right to reclaim and distributing the surplus funds (amounts in excess of what is required to meet future reclaims), to social and environmental initiatives across the UK.
AWE plays a crucial role in nuclear defence, providing the warheads for the UK’s nuclear deterrent.
The UK Infrastructure Bank (UKIB) is the new, government-owned policy bank, focused on increasing infrastructure investment across the United Kingdom. It will partner with the private sector and local government to finance a green industrial revolution and drive growth across the country.