The largest UK shareholders have unveiled guidelines that should lead to closer scrutiny of public companies.

In a move to counter criticism they do not monitor companies closely enough, the Institutional Shareholders Committee (ISC) has published a code of practice. It includes pledges to monitor companies, subject boards to closer scrutiny and intervene in company management when needed.

The code is voluntary and follows mounting pressure from regulators for investors to hold companies to greater account in the wake of the financial crisis.

The ISC comprises the four main trade associations for institutional investors: The Association of British Insurers, the National Association of Pension Funds, the Association of Investment Companies and the Investment Management Association.