• Some (slow) progress? The number of women on boards globally is on the rise, but boards appear to be drawing on the same pool of female directors according to MSCI report 
• Only 12 months late? There are more than 30% female directors on ASX 200 boards for the first time 
• In Brief | Women outnumber men on US payrolls for the first time since 2010 accounting for 50.4% of jobs.  The increase is attributed to the growth in female dominated sectors such as health care and education which are adding jobs (many of which are low paid/part time)

• United Kingdom | High Pay Day 2020: FTSE 100 CEOs pay has already surpassed the amount an average worker earns in a year 
• A 'systemic compensation issue'? Analysis of discretionary pay trends over five years has identified that bonuses are increasingly being awarded by default (in the US)
• US public attitudes to CEO Pay: A high degree of cynicism 
• In Brief | Not yet final?  The AFR reports that APRA is considering a second round of consultation on its proposed changes to remuneration (proposed changes to CPS 511) in response to concerns raised about the proposed imposition of a 50% cap on use of financial metrics, and in order to enable further consideration of options not previously put forward by the resgulator.  Reportedly, the APRA plans to release a finalised standard in the first half of 2020
• In Brief | Reportedly ASX 100 CEO pay since the start of 2020 has already exceeded the annual earnings of the average worker.  ASX 100 CEOs received an average annual income of $5.66 million in the 2018 financial year, or around $108,846 a week before tax.  By comparison, on average, full-time workers in Australia earn $1633.80 a week, or roughly $84,950 a year

• Trends in Shareholder Activism in 2019: Activist campaign activity in Australia was down 8% on 2018 according to a report from Activity Insight
• Barclays reportedly targeted by climate group, ShareAction

• United Kingdom | More than lip service is required to rebuild confidence and trust: The FRC has released its annual review of reporting against the Governance Code
• In Brief | Adhering to a nine year tenure guideline as part of director succession planning:  BHP has announced that Lindsay Maxsted will not stand for reelection at the 2020 BHP Annual General Meetings having served on the board since 2011.  Mr Maxsted is set to resign at, or before, the 2020 AGMs.  Reportedly, Mr Maxsted has separately flagged plans to exit the chairmanship at Transurban, but has not put a hard date on his exit after being elected for a further three years in 2019

• Hong Kong | New ESG requirements: HKEX ESG Guide and Listing Rules amendments to take effect on 1 July 2020

• Implementing FSRC recommendations 6.9 and 6.11: Draft legislation released for consultation relating to ASIC and APRA coordination and information sharing 
• Implementing FSRC recommendation 6.12 (applying BEAR to ASIC/APRA): ASIC and APRA have separately released their accountability statements 
• All six KPIs met: APRA self-assessment against the Australian government's Regulator Performance Framework released
• In Brief | ASIC's priorities? The AFR reports that in addition to a 'surge in enforcement' actions, ASIC's Corporate Governance Taskforce is set to expand its work to focus to boards of large listed companies (outside the banks) as well as to auditors and superannuation fund trustees.  ASIC is also set to report early this year on the governance of executive remuneration (with a focus on exercise of board discretion)
• In Brief | Cyber threats are a key focus for APRA: The AFR reports that APRA is working closely with the Australian Signals Directorate, the Australian Security Intelligence Organisation as well as with other international peer securities regulators on how address the threat of cyber attacks on financial institutions

• Top Story | ASIC is consulting on draft guidance for the new financial product design and distribution obligation obligations
• Implementing FSRC recommendation 7.1: establishment of a compensation scheme of last resort
• The Treasurer has issued a statement confirming the government has met with the insurance industry to discuss their response to the bushfire emergency, separately ASIC has said it is working with insurers and other stakeholders to ensure that claims are handled efficiently and fairly
• Consumer Data Right timeline deferred
• Buy now pay later code of conduct announced
• ASIC has commenced civil penalty proceedings against a Volkswagen subsidiary for alleged breach of responsible lending laws
• A costly distraction (or not)?  Reportedly questions have been raised about APRA's plans to assess the performance of 40,000 Choice products following the release of the MySuper heatmaps last year
• APRA super data transformation project: second APRA discussion paper released
• In Brief | Transforming data collection/analytics in the UK financial sector: The Financial Conduct Authority (FCA) and the Bank of England (Bank) have outlined plans to develop their data and analytics capabilities.  The Bank of England has also published a Discussion Paper, setting out a framework for assessing the issues and an initial range of potential options for transforming the hosting/use of regulatory data going forward.  The Discussion paper marks the start of a review into how the timeliness and effectiveness of data collection from firms across the financial system might be improved (as recommended by the Future of Finance Report)
• In Brief | The ACCC's latest Northern Australia Insurance Inquiry Interim Report has found that high premiums are leading to a rise in uninsured homes in northern Australia with the highest rate of non-insurance in northern Western Australia.  According to the report, home and contents insurance premiums in northern Australia are on average almost double those in the rest of Australia (and even higher in some areas).  Among other things, the report recommends: abolishing, or re-basing, stamp duty on home, contents and strata insurance products; prohibiting conflicted remuneration for insurance brokers; and revising and mandating standard cover to help consumers choose and compare options.  The due date for the final report is 30 November 2020

• Update UK audit sector reform update: Brydon Review Released 
• United Kingdom | New Industry Code of Practice for auditors
• In Brief | The Financial Reporting Council (FRC) has updated its Practice Aid to reflect developments since the first edition was issued in 2015 and better assist audit committees in evaluating audit quality in their assessment of the effectiveness of the external audit process
• In Brief | The FRC has issued a statement deferring the date for completion of the first phase of its investigation into KPMG in connection with its audit work on Carillion due to the complexity of the case and its decision on whether to bring enforcement action.  The FRC says that though its investigation is well advanced, it expects to complete the first stage of its investigation by 'summer 2020' rather than January as initially planned 

Climate Risk

• Top Story | BlackRock CEO Larry Fink's Annual Letter 2020: BlackRock CEO Larry Fink's Annual Letter 2020: 'Climate risk is investment risk'
• Corporate governance reform is urgently needed? 76 academics have signed the Corporate Governance for Sustainability Statement calling for urgent reforms to address the failure of corporations to consider environmental, social or long-term, economic sustainability
• Targeting a superfund over its (alleged) failure to support shareholder climate proposals: Market Forces is targeting superannuation fund UniSuper to divest members' retirement savings from fossil fuel companies 
• In Brief | BlackRock has joined Climate Action 100+ which requires its signatories to push companies to reduce greenhouse gas emissions in line with the goals of the Paris Agreement, implement a strong governance framework articulating the board's accountability/oversight of climate change risks/opportunities and provide enhanced corporate disclosure in line with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).  The addition of funds BlackRock manages, brings total assets under management represented by investors participating in Climate Action 100+ to more than $41 trillion

Cybersecurity, privacy and technology 

• Cyber resilience in Australian financial firms is improving: ASIC Report 651 released
• 'Imperative' that the financial services sector acts to invest in, and to implement regtech: ASIC Regtech initiative report released

Other Developments

• In Brief | Not 'fit and proper': The FCA has written to CEOs of wholesale general insurance firms following 'incidents of non-financial misconduct' setting the 'clear expectation that you should be proactive in tackling such issues'.  The letter states that non-financial misconduct will be a key focus for the supervision of firms and senior managers going forward and that the regulator's expectation is that firms and senior managers act promptly to address any cultural gaps/shortcomings 

• ASIC report on corporate insolvencies 2018–19 released 
• In Brief | The Australian reports that that ASIC has established an investigative unit targeting pre-insolvency advisers and directors it believes are coaching others on how to illegally "phoenix" businesses to avoid paying creditors.    Reportedly, the regulator is understood to be focusing industries where it believes the problem is most prevalent, with construction, labour hire, and transport and logistics the top three priorities