The Financial Reporting Council (FRC) has outlined its progress across 2024 and its priorities for 2025 in its annual letter to the Secretary of State for Business. 

It has detailed five measures to support economic growth, in line with the government’s emphasis on creating the right environment for growth and investment:

1. Underpin investor and broader confidence in UK plc

The FRC says it will encourage high standards of corporate governance, financial reporting and audit quality to boost investor confidence. It cites its work on the recent consultation and review of the UK Corporate Governance Code as evidence of its commitment to this.

2. Embed the principle of proportionality in its work 

The FRC says it will identify and address unnecessary burdens on business in 2025, pointing to amendments to reporting requirements associated with the investor Stewardship Code.

3. Research the markets it oversees to ensure regulations work effectively to support growth. 

The regulator has already launched market studies into the assurance of sustainability disclosures and the NHS audit market to better understand how they are operating.

4. Identify key future trends and innovations. 

The FRC’s new Digital Reporting team was used to illustrate the type of work the FRC foresees doing in this area, along with guidance on AI use for the actuarial profession.

5. Support the future skills and resilience of relevant professions. 

The Scalebox initiative for smaller audit firms looking to grow their audit portfolios is, according to the FRC, the first in a series of resources supporting the professions within their relevant markets. 

"We have outlined five clear priorities so we can fully support the government’s ambition for UK economic growth and contribute to the UK’s well-earned reputation as an attractive destination for investment,” says FRC CEO Richard Moriarty. “We welcome the government’s support for our approach and its commitment, as outlined in the King’s Speech, to bring forward the draft legislation for audit and governance reform.”

Iain Wright, ICAEW’s Managing Director, Reputation and Influence, welcomed the FRC’s ambitions. “The five priorities outlined are sensible and pragmatic steps to ensure the FRC is regulating for growth. We are pleased to see accountancy as part of professional and business services be rightly included as a key sector in the government’s industrial strategy and we support the government’s mission to deliver economic growth. 

“We hope the FRC will augment this statement in due course with more detail about how it will be carrying out its growth remit. Reliable and trusted company reporting is fundamental to investor confidence and this, in turn, is key to economic growth and stability. We stand ready to play our part in ensuring trust and growth go hand in hand.”