LONDON (Reuters) - Large private companies in Britain will have to comply with governance standards for the first time from 2020 in a response to the collapse of unlisted retailer BHS that left thousands of people out of a job.

FILE PHOTO: People walk past a branch of BHS on Oxford Street in London, Britain April 25, 2016. REUTERS/Peter Nicholls

BHS went into administration in 2016, putting 11,000 people out of work and leaving a 571 million pound hole in the company’s pension scheme. The political outcry led to a government clampdown on bosses who fail to protect workers’ pensions.

The Financial Reporting Council (FRC), a regulator that monitors corporate governance, on Monday published the Wates Principles and private companies will have to say to what extent they comply with them. They mirror rules already in place for listed companies.

About 1,700 private companies will be captured by the new code if they have more than 2,000 staff, or a balance sheet of more than 2 billion pounds, and a turnover of over 200 million pounds.

The principles, named after James Wates, the head of a construction company who chaired an industry coalition set up by the FRC, will be applied to annual reports published from January 2020.

“They are just good common sense. We are not trying to reinvent any wheels,” Wates told Reuters.

But they are unlikely to prevent another collapse like BHS, Wates said. “If people are determined to do things, they will. What it will do is set out standards that people will hopefully aspire to.”

The six principles include having clear board member responsibilities, promoting the long-term, sustainable success of the company, and meaningful engagement with staff and having regard to their views when taking decisions.

They also touch on the sensitive issue of boardroom pay, saying it should be set at “appropriate and fair levels” to secure and retain high-quality directors and senior managers, and aligned with performance.

But the disclosure of pay ratios, or the difference in pay between chief executives and their average UK worker, would only be on a voluntary basis.

Pay ratio disclosures are mandatory for listed companies after a public outcry over bonuses being out of step with company performance.

“We want people to think about their remuneration in the round and articulate their philosophy. What you don’t want to do is put a price tag on your people as they could be recruited away from you,” Wates said.

Matthew Fell, deputy director-general of business lobby CBI, said the principles could aid robust decision-taking informed by strong engagement with staff, customers and owners.

The FRC will monitor how the new code is applied.