Ofwat has today made it compulsory for all water companies to meet new objectives about board leadership, transparency and governance (BLTG), including the need to establish a purpose, strategy and set of values.
Company boards must also be satisfied that these, and its culture, reflect the needs of all those it serves.
Following a consultation, all 17 water companies in England and Wales and the only licensed infrastructure provider (Bazalgette Tunnel Limited, known as Tideway), have agreed to Ofwat modifying their licences.
Aileen Armstrong, Senior Director of Finance and Governance at Ofwat said:
“These changes are part of our wider package of reform to rebuild trust and confidence in the water sector and safeguard the interests of customers.
“The corporate behaviour of some companies, along with significant service failures, has damaged trust in the sector, so it is only right that company boards, through their leadership, take ownership of how they meet these objectives. These should inspire companies to take full responsibility for understanding and delivering what is right for their customers and the environment, and place those needs at the heart of their business.”
The changes made today insert a requirement into the companies’ licences that make it mandatory for companies to meet the objectives of the BLTG principles.