The world's most famous governance canon, the Combined Code, is gaining new adepts. In 2009, 141 companies in the FTSE 350 index (47%) declared full compliance with the code, as opposed to 132, or 44%, in 2008. The finding is reported in a survey published by Grant Thornton in February, based on 299 companies listed in the index.

The study emphasizes, however, that there is a gap between companies that claim to fully comply with the Combined Code and those that in fact provide all of the necessary explanations to prove their conformity (only 41). Grant Thornton attributes the difference more to the difficulty some companies have in understanding what the code recommends than to corporate governance flaws per se. "Furthermore, analyzing the companies individually, there are some that consider themselves compliant but in truth aren't, as they fail to comply with one or two provisions", the report states.

The number of companies that choose to thoroughly explain why they don't comply with certain provisions of the Code has also increased. In 2009, 68% of the companies chose explain over comply, as opposed to 66% in 2008, the study reveals.

With this data in hand, the report poses the question: can we consider our work done, or should we conclude that the code didn't achieve its goal given the recent failings of company boards? According to Grant Thornton, the answer may be somewhere in between. With such a high level of compliance, now's the time for companies to recalibrate their corporate governance and raise the bar. For the Financial Reporting Council (FRC), which constantly revises the code, the challenge remains the same: making companies treat the code's provisions not merely as items to be obeyed, but as a behavioral guide.