This document is a consultation on reviewing and updating Ofwat’s existing board leadership, transparency and governance principles.
It sets out:
- our proposals for updating the existing principles in light of the need to address legitimacy concerns in the sector and developments in corporate governance;
- our rationale behind the changes we are proposing to the principles; and
- proposed licence changes to embed the principles in all companies’ licences, and to ensure that there is a minimum requirement for independent membership of the board.
This is part of Ofwat’s wider package of work to rebuild trust and confidence and put the water sector back in balance, as set out in our April 2018 Implementation letter sent to water company CEOs.
The changes proposed in this document would apply to the 17 largest regulated water companies (appointees) in England and Wales and the only licensed infrastructure provider (Bazalgette Tunnel Limited, known as Tideway). The size of smaller appointees (which we commonly refer to as new appointments and variations) means that meeting the principles may not always be proportionate for them. However we still expect these companies to demonstrate exemplary governance and to meet the principles where they can.
We welcome responses to this consultation by close of business on Tuesday 21 August 2018. Please email responses to FinanceAndGovernance@ofwat.gsi.gov.uk or post them to: Board leadership, transparency and governance consultation, Ofwat, 21 Bloomsbury St, London, WC1B 3HF