AIM Rules overhaul with key corporate reporting implications

What's the issue?

In August 2026, the London Stock Exchange (LSE) published a significant update to the AIM Rules for Companies (AIM Rules) following an extensive consultation process. The changes are intended to reinforce AIM's position as a leading growth market by reducing unnecessary regulatory burdens, supporting capital raising and transactions, providing greater flexibility for founder-led and innovative businesses, attracting international companies and placing greater reliance on the expertise of nominated advisers.

The revised AIM Rules took effect immediately from 5 August 2026 when AIM Notice 64 was published, and represent the most substantial overhaul of the AIM framework for a number of years.

What does this mean?

Background

The revised AIM Rules are designed to modernise the regulatory framework and ensure that AIM remains attractive to growing and entrepreneurial businesses. The reforms seek to reduce administrative complexity, simplify fundraising and transaction processes, and provide companies with greater flexibility while continuing to maintain an appropriate level of investor protection.

Key corporate reporting implications

AIM companies can now use FRS 102

One of the most significant corporate reporting changes is that AIM companies are now permitted to prepare their financial statements in accordance with FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), rather than being required to report under International Financial reporting Standards (IFRS).

This represents a major simplification for many AIM companies, particularly smaller and mid-sized entities that have historically been required to apply full IFRS solely because of their AIM listing status. The change may also encourage some AIM companies to assess whether transitioning from IFRS to FRS 102 would be beneficial, although any transition would need to be carefully planned given the accounting and disclosure implications.

In addition, non-UK AIM companies are now permitted to use local GAAP where materially equivalent to IFRS.

A more flexible corporate governance framework

The second major corporate reporting change relates to corporate governance. Historically, AIM companies were required to adopt and report against a recognised corporate governance code. Under the revised AIM Rules, companies will no longer be required to adopt a specific governance code.

Instead, companies will be expected to implement governance arrangements that are appropriate for their individual circumstances and explain those arrangements to investors.

Governance reporting will focus on disclosures relating to:

• Board composition;
• Directors' roles and responsibilities;
• Remuneration and performance;
• Risk management and controls; and
• Approach to investor relations.

This represents a move away from a "comply & explain with a code" approach towards a more principles-based disclosure model. Companies should therefore review how governance information is communicated, ensuring that disclosures clearly explain how governance arrangements operate in practice rather than simply referencing compliance with a particular framework.

Other ongoing AIM Rule changes

Alongside the key reporting reforms, a number of other changes affect ongoing obligations for AIM companies:

• Nomads are no longer required to provide a fair and reasonable opinion on non-standard director remuneration arrangements, provided they are satisfied that the terms offer appropriate commercial protection for the company.
• Existing AIM companies issuing a second line of securities will no longer be required to publish a full admission document.
• Companies may voluntarily disclose information regarding engagement with proxy advisers.

Transaction and fundraising changes

Several reforms are intended to support capital raising and reduce transaction-related regulatory burdens:

• A new "capital access window" allows AIM companies undertaking an equity fundraising to request a temporary suspension of trading while marketing or negotiations take place.
• The definition of a reverse takeover has been narrowed. Transactions will only be classified as reverse takeovers where they result in a fundamental change to the business, board and/or voting control.
• Transactions exceeding class test thresholds, but not resulting in a fundamental change, will instead be treated as substantial transactions.
• The threshold for substantial transactions has increased from 10% to 25%, reducing the number of transactions subject to enhanced requirements. This now aligns with the Main Market framework.
• Reverse takeover announcements will not automatically result in suspension of trading where alternative disclosure arrangements are considered sufficient by the Nomad.
• The AIM class tests have been revised to align more closely with the Main Market framework.

Admission process and international market reforms

A number of changes have also been introduced to simplify admission to AIM and improve its attractiveness to domestic and international issuers:

• Admission documents may incorporate certain information by reference where it is already publicly available.
• The existing working capital statement has been replaced with more targeted disclosures relating to capital resources, financial obligations and expected funding requirements.
• Supplementary admission documents will only be required in limited circumstances where there is a significant new factor, material mistake or material inaccuracy.
• Special voting shares are now permitted, enabling founders to retain enhanced voting rights after admission.
• The AIM Designated Market Route has been replaced by a new Express Market Route for international companies.
• A new dual-market admission route allows eligible companies to seek admission to both an Express Market and AIM using the same admission documentation.
• Admission documents will contain specific buyer beware disclosures to ensure investors understand the risks associated with AIM investments.

What are the key takeaways?

From a corporate reporting perspective, the standout changes are the introduction of FRS 102 (UK GAAP) as an available reporting framework and the move to a more flexible, company-specific approach to corporate governance reporting. Together, these reforms have the potential to reduce reporting complexity and compliance costs while providing companies with greater flexibility in how they communicate their governance arrangements to investors. The remaining changes are primarily aimed at simplifying admissions, supporting fundraising activity and making AIM a more attractive market for growth companies.