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Audit Committee Chairs’ views on, and approach to ESG

Copyright

Liability

No party accepts any liability for any loss, damage or costs howsoever arising, whether directly or indirectly, whether in contract, tort or otherwise from any action or decision taken (or not taken) as a result of any person relying on or otherwise using this publication or arising from any omission from it.

Executive summary

Views and reflections on ESG

The majority of ACCs in this study viewed ESG as an important part of good business practice. Many ACCs stated that ESG has increased in importance in the last few years, both within their organisations and across industries. The Covid-19 pandemic was a trigger for both awareness and engagement in ESG, as environmental and social issues came to the forefront, for example around working from home practices and staff well-being levels.

The ACCs interviewed all showed an interest in ESG and a good understanding of the ESG activities undertaken in their organisations, such as initiatives aiming to reduce plastic use, carbon emissions and increase charity engagement and board diversity. However, many are not directly involved in the decision-making processes, especially in relation to environment and social elements; and when organisations have in-house environment and social experts or sub-committees. It was noted that ACCs' main role is related to risk and compliance, as well as ensuring ESG is effectively reported on, rather than deciding on what to implement and how.

For some ACCs, the components of ESG were seen to be connected and work harmoniously with one another. However, a small number of ACCs felt tensions can arise when trying to prioritise ESG activities with profit-making responsibilities, especially in relation to environmental activities.

Some ACCs reflected on how the success of ESG can be dependent on executive management's interest levels and the company's access to ESG resources. Similarly, it was noted by a few ACCs that if current and potential shareholders have an interest in ESG it tends to influence the business' attitude towards the framework and give greater importance to the company's efforts. A few ACCs reflected that any cynicism tends to be focused on environment and social elements, as governance is well established and part of the Corporate Governance Code.

Environment

Some ACCs said that the environment has been prioritised over the other ESG areas in the last couple of years. Environment activities undertaken are wide ranging, depending on the sector, operating markets, and size of the company. Many organisations are trying to reduce their carbon emissions, workplace plastic use and encourage staff to cycle or walk to work.

The Task Force on Climate Related Disclosures (TCFD) was well known amongst the ACCs in the study, with TCFD recommendations being implemented by most. Those in larger companies tended to be most familiar with TCFD's targets and better able to fulfil its requirements due to the resources they have at their disposal. There were mixed attitudes towards TCFD, including a small number of negative reactions around continual changes to reporting standards. Alongside this, there were concerns from a few ACCs around the extended time and costs required for smaller businesses to comply with the recommendations.

The importance of the social component was reported by some ACCs to be increasing, especially regarding board and senior management diversity, staff wellbeing and equal pay. Some ACCs reflected that the expansion of social activities is driven in part by societal shifts, in turn making investors more interested in companies' social policies and activities and motivating companies to place a greater focus on their social activities and reporting. Furthermore, many ACCs recognised the important role the social component plays in employee retention and attracting high quality and diverse employees.

Governance

All ACCs felt they had a firm understanding of governance activities, issues, and risks, as these activities and measures are well established. Compared with the environment and social components, it is felt to be easier to define what activities, risks and issues have to, or should, be reported on due to the Corporate Governance Code (CGC). Pay transparency, succession planning, remuneration and bonuses of c-suite and board members were noted by some ACCs to have grown in importance for both investors and employees in the last few years.

Measuring and reporting on ESG

Some ACCs reflected that ESG was 'too broad' and that it continues to evolve and grow rapidly, which can make the measurement of ESG activities difficult and inconsistent across sectors and markets. Some ACCs said that it can be especially challenging to measure and report on environmental activities, particularly indirect emissions (scope 3) and the impacts on markets outside the UK and Europe.

Many ACCs felt that the increased focus on ESG in reporting was making annual reports longer and longer, thereby making it harder to identify key information. A small number were concerned that the detailed reporting requirements could lead to performative policies, rather than authentic ones which are embedded into business practice. Finally, some ACCs had time and cost concerns around reporting on ESG, especially those from organisations who do not have sufficient resources or dedicated environment and social audit specialists.

Many ACCs commented that the guidance on ESG related activities, and how to measure them, is complex to navigate - particularly for businesses with limited resources, those who operate across markets and those who have only recently begun to invest time into environment and social activities.

When asked what role the FRC could play, some, mainly from smaller organisations, said that they would welcome more practical guidance that is sector specific, especially related to measuring environment and social activities. Some ACCs would also welcome best practice examples to ensure ESG reporting is salient and meaningful, rather than adding more reporting requirements.

Research background and context

Research aims

Audit Committees play a vital role in ensuring audits are conducted to high standards. The Financial Reporting Council (FRC) engages with Audit Committee Chairs (ACCs), often through third parties, to inform their work and improve the quality of audits.

Both qualitative and quantitative research has been conducted with ACCs previously on the topic of audit quality by YouGov for the FRC, with studies completed in 2015, 2020 and 2021/22.

Financial Reporting Council

The FRC wanted to build upon this work, with the aim of furthering its understanding of ACCs' views on, and approach to, Environmental, Social and Governance (ESG) activity and reporting. YouGov, an independent research agency, was subsequently commissioned to conduct 40 qualitative interviews (lasting 45 – 60 minutes) with ACCs of Public Interest Entities (PIEs).

As in previous years, the research was conducted with a wide range of ACCs from different organisations (e.g., FTSE 100, FTSE 250, other listed equity, building societies, unlisted banks) and from a range of sectors. Some ACCs sat on the boards of multiple companies and referred to their experiences across these companies during interviews.

Recruitment summary

The table below outlines a recruitment summary according to organisation type. Interviews were conducted between November 2022 and March 2023. All quotations within this report include the organisation type and sector of the ACC.

Table 1: Summary by market

Organisation type	Number of interviews
FTSE 100	11
FTSE 250	18
Other listed	9
Unlisted entities	2
TOTAL	40

Sector	Number of interviews
Financial Services	8
Insurance	5
Healthcare	4
Industrial Goods and Services	4
Banks	4
Tech and Telecoms	4
Consumer Products and Services	3
Basic Resources	3
Real Estate	1
Chemicals	1
Construction and Materials	1
Travel and Leisure	1
Food, Beverage, and Tobacco	1
TOTAL	40

Research findings

This section sets out the main findings from the interviews with ACCs in line with the key sections of the interview discussion guide (see appendix for details of the discussion guide). Each finding is summarised and then followed by quotations from the interviews that exemplify the finding. All findings are rooted in discussions with ACCs rather than the opinions of YouGov.

Overview of ACCs

Many of the interviewees were Audit Committee Chairs (ACCs) for more than one business within similar sectors; this meant that ACCs' relevant experience could be maximised in their roles. ACCs had often worked as auditors earlier in their careers, and possibly as Chief Financial Officers, and felt that these experiences complemented their role as an ACC.

> "I was a CFO for many years and then gave up the executive life and took on a few audit committees." (ACC, Food, Beverage, and Tobacco)

The majority of ACCs reported that the time commitment to fulfil ACC responsibilities varies month to month, with more time required around year end due to reporting requirements. For most ACCs, committee meetings required extensive reading and meetings with the executive and finance teams, alongside keeping abreast of new trends and potential risks in their business and wider sector.

> "Towards reporting periods at the half year and year end, so January, February, July, August, I will spend a lot more time on the audit matters." (ACC, Chemicals) > > "In terms of time, my contract specified 25 days a year, but it takes much more than that, it can be double that.” (ACC, Insurance)

Some ACCs reported that the organisations they were the audit chairs of have separated the audit committee and the committee which focuses on ESG activities. These ACCS commented that this meant that ESG can be focused on in a more concentrated manner as some felt that a significant amount of time is needed to discuss environmental impacts or social programmes within their businesses. Although many businesses also separate ESG from their risk committee, ESG-related conversations are still factored into audit or risk committee meetings.

> "We have a separate Sustainability Committee, which is focused on the 'E' aspect of ESG... because there's so much to do.” (ACC, Consumer Products and Services) > > "We separated the audit committee from the non-financial stuff (like ESG), because the amount of work required increased enormously and we had limited time to deal with it appropriately.” (ACC, Basic resources) > > “We don't have a separate ESG committee, we don't necessarily focus on it as a specific topic as it permeates into everything we do.” (ACC, Banks)

Views and reflections on ESG

Awareness of ESG

Most ACCs in the study became aware of ESG between 5 and 10 years ago. Some ACCs said that the Covid-19 pandemic triggered an increase in awareness and engagement, especially in relation to environment and social components, with many employees working from home and experiencing negative impacts on their well-being and health.

> "It [ESG] has always been there – since section 172 of Companies Act... climate related disclosures came together combined to a more formalised ESG”. (ACC, Financial Services) > > “I first heard of ESG around 2019 but didn't have much knowledge until the pandemic, then everything went online, and I used the first Covid lockdown to ramp up my knowledge of ESG and particularly sustainability and carbon.” (ACC, Chemicals) > > "After the pandemic and with this inflationary period alongside global warming and issues around racial and social justice there's a snowball effect when it comes to ESG and I think it will be with us for a while.” (ACC, Financial Services)

Some ACCs described ESG as a natural progression from previous policies in their businesses. This is particularly true of governance, which has been a critical part of running a successful business for a very long time. Comparatively, a focus on the environment is a more recent development.

> “Earlier ESG meant just G and slowly it incorporated the S. The E came to the forefront in the recent years especially after the TCFD.” (ACC, Healthcare) > > "The G is not new. It's been around for 30 years and what is new today and probably for the last five years, the environmental agenda has risen up the scale and is now very active and the social agenda is rising up the scale simply because younger people don't want to work for a company that doesn't have a social purpose." (ACC, Travel and Leisure)

Awareness of ESG was often dependent on the sector of an ACC's business. For example, those in industrial goods and services (where businesses tend to have more emissions than in sectors such as financial services) were more aware of and engaged in ESG related activities, such as reporting on scope 1, 2 and 3 emissions.

> “ESG was on the agenda for many years as an executive director. ESG is commonly used term now to basically encapsulate the area of recognition, recognition of impact on stakeholders, impact on environment and on stakeholders.” (ACC, Industrial Goods and Services)

Conversations around ESG have evolved since it was first introduced, with some businesses still building their evidence base for reporting, alongside understanding what 'getting ESG right' looks like and how it should be managed at board level.

> "We are still formulating what ESG looks like, we haven't set targets yet as we don't have the full data we need.” (ACC, Insurance) > > "I think over the last couple of years, there has been serious discussion on the board as to what specific role the audit committee should take on it [ESG].” (ACC, Food, Beverage, and Tobacco) > > “Now there's much more investor pressure to understand what we're doing [on ESG] and where we are in our journey etc. and what the opportunities are and what the risks are. It's coming up the agenda." (ACC, Real Estate)

Attitudes towards ESG

For some ACCs, the three components of ESG are connected to, and work harmoniously with, one another; they can complement each other as they often focus on ideas of responsibility and sustainability. However, others felt that each individual component can dilute the saliency of ESG as a whole, leading to some ACCs calling for the components of ESG to be broken up into their constituent parts.

> “ESG can feel quite nebulous, you can end up with a combination of issues which don't always connect” (ACC, Media) > > "Some say that E, S and G are interconnected but I am of the view that the E, S and G are separate entities that are mashed together." (ACC, Media) > > “I think ESG is a bit of a catch-all, and they're not the same." (ACC, Consumer Products and Services)

Some ACCs felt that ESG is 'too broad' and that it continues to evolve and grow rapidly. This led some ACCs to comment that perceptions and the likelihood of success around ESG vary. This was particularly true for companies which have tangible outputs (who have higher demands when it comes to reporting emissions) or smaller businesses (who have limited resources for reporting on ESG).

> "ESG is a horrible acronym in many ways, it's slightly artificially thrown together, and you've got some bits that are more or less important to your business.” (ACC, Food, Beverage and Tobacco)

The broad nature of ESG led to some concerns that companies will be able to hide potential risks or 'greenwash' elements of their ESG reporting. Some were also concerned that the detailed reporting requirements on ESG can lead to performative policies, rather than authentic ones which are embedded into business practice.

> “I think there's a proliferation of certification schemes, and consultants, and people greenwashing themselves... picking a way through that and finding the substance is the challenge." (ACC, Healthcare) > > "It is about being honest about what you can and can't do, that you do try and avoid the greenwashing.” (ACC, Insurance)

Some ACCs saw ESG as a ‘tick box exercise’ which focuses on fulfilling reporting requirements. However, accurate reporting can also be harder in certain sectors due to lack of benchmarks e.g., those who do not have tangible outputs.

> “In terms of pleasing our shareholders, they like quantitative measures because then they can tick their box and say yes, they've done it. So, a lot of the pressure at the moment is to move towards quantitative, not qualitative.” (ACC, FTSE 100) > > “I suppose my concern with ESG is there's been a huge amount of additional regulation, reporting requirements, etc, and you just wonder what the value is of reporting some of this stuff for companies that are actually doing their bit”. (ACC, Basic resources)

However, these more sceptical attitudes around ESG were not consistent across interviews. Many ACCs felt that conducting ESG activities is a moral imperative and a critical part of their business practice. This difference in attitude was often driven by the sector they work within, their size (and availability of resources) and where they are on the ESG lifecycle. For example, those in the healthcare, energy and transport sectors who often have specific targets set around ESG; or a consumer centric business.

> "The S is most prioritised because we are a patient centric business.” (ACC, Healthcare) > > "The S has been more important for the company. The reason for that is that we are after very bright talent, which is pretty scarce, and so it's pretty important for us to attract talent, and therefore, the S element in our HR process is important.” (ACC, Healthcare) > > "At [redacted] there is more of a focus on the E as it's an agriculture company.” (ACC, Various)

Alongside this mix in attitudes, some ACCs indicated success with ESG can be dependent on executive management teams, specifically the extent to which the teams take a personal interest in ESG and want to invest time and energy into ESG activities. Similarly, ACCs indicated that if shareholders have an interest in ESG, it tends to influence the attitude of the executive management/board, who will consequently place greater focus on it. ACCs suggested Executive management teams who had cynical views on the relevance of ESG to their business were less likely to invest time and resources into it. This cynicism tended to be focused more on environment and social elements, as governance was well established and part of the Corporate Governance Code.

> "A lot depends on it [success], the other priorities of the business but probably most importantly is whether the CEO 'gets it'. And I'm fortunate in that both of my listed companies, they do. And it's something that they think about daily. It's not something that they pick up and put down because they've got a board meeting coming up. It really is integral to the strategy and what they're trying to do.” (ACC, Real Estate) > > "The cynic in me sometimes questions the real commitment of investors to ESG in the long run. As long as ESG is a contributor to profitability and attracting further investment and not just ticking boxes it will continue to be engaged with.” (ACC, Healthcare) > > "ESG has become more important because of investor focus.” (ACC, Media)

Guidance around ESG

Many ACCs commented that the amount of guidance on ESG-related activities is 'excessive' and can be complex to navigate, particularly for businesses with limited resources or those who have only recently begun to invest time into ESG activities. This perception led some ACCs to be concerned about their business' ability to meet expectations and targets, and therefore report in a meaningful way.

> "There is a proliferation of standards to be met, TCFD, science-based targets, UN SDGs, etc. which is quite tedious as the expectations are so high.” (ACC, Basic Resources) > > “There is guidance around reporting on ESG, but I think it's still quite early in terms of how people tackle it because discussions are ongoing... Plus E is a lot tougher to report on than S and G.” (ACC, Financial Services) > > "There's a lot of guidance when it comes to ESG reporting, particularly for new organisations, plus new advisors and consultants which makes for a proliferation of certification schemes." (ACC, Construction and Materials)

There were mixed views about the best place to report on ESG within a business' reporting cycle. Many ACCs said businesses reported on ESG separately to their audit and risk obligations. The expanding requirements around ESG reporting lead many businesses to submit their reports yearly or half-yearly ensuring that ESG ‘has its own space’ and ‘can be done justice’, due to the amount of reporting work which needs to be completed. Other ACCs felt that ESG permeates through all aspects of their business so should be reported on within an audit or risk report.

> "ESG is too big and it's too intertwined.” (ACC, Insurance) > > “There's a tonne of guidance on ESG responsibilities and the hard work is to get consistency among them and deciding which are relevant to your organisation.” (ACC, Media) > > "I think there needs to be more guidance going forward in terms of proportionality because, the scope is just getting wider and wider.” (ACC, Banks)

Some ACCs commented on the need for consistency with reporting, rather than expanding guidance. They called for a 'simpler' and more 'standardised' structure or framework which considers different businesses' risks.

> "Reporting on environmental impact and carbon emissions needs to be standardised.” (ACC, Banks) > > "We need less guidance, instead we need a standardised structure with examples of best practice, showing what other organisations are doing.” (ACC, Media) > > “There's not much consistency on ESG reporting from different bodies, which creates confusion, particularly that different countries have their own rules on ESG reporting.” (ACC, Banks)

Other ACCs felt that a more standardised structure would not necessarily resolve the issue of inconsistent data collection and reporting across sectors and markets, which makes cross-sector and cross-market benchmarking difficult.

> "There is increasing guidance and rules around ESG, however these can be difficult to manage as they can be too broad and there are inconsistencies with rules for different organisations.” (ACC, Telecommunications) > > "There are a wide range of conflicting standards that people are asking for and that can also vary from institutional investor to institutional investor. The large companies can afford to devote significant resources to it." (ACC, Healthcare) > > "There are no set measurements on CO2 emissions and there's no way to measure it across different sectors because the unit of measurement used by companies could be different.” (ACC, Healthcare)

Finally, there was a cost concern around reporting on ESG, especially amongst those ACCS who have only recently been introduced to ESG and do not have sufficient resources or specialists to dedicate to it. The cost of external assurances was noted to have significantly increased; this places a cost burden on some companies and can influence how they feel about ESG. With that in mind, some ACCs felt that regulators should consider how feasible extensive reporting is for some businesses, particularly those who are still building benchmarks and collecting data.

> "It's made it very, very difficult to find lower-tier audit firms that can handle the areas that the big auditors handle without any issue whatsoever, and what you see is a massive rise in the cost of an external audit because primarily the scope is increasing.” (ACC, Banks) > > “In as much as possible we will report on carbon footprint but that depends on having reliable data for us and underlying companies... The data can be pretty iffy or out of date, so it has limited utility.” (ACC, Various)

Variation according to sector

From the interviews, it appeared that ACCs' attitudes to ESG varied significantly depending on their companies' sector. Differences were particularly apparent amongst ACCs of companies in construction, banking, and extractive industries.

In the construction industry, for example, attention is paid to manufacturing processes - including the materials used and the impact of production and installation - along with sustainable business practices. From a social perspective, construction and industrial works can have a significant impact on local communities as well as their own workforce, so this also receives special attention.

> "Social is largely around employees and society generally and local communities and that's largely work that's done by individual sites because it's a very big employer in the UK and is spread around into local communities. So, they do put a lot of time into engaging with local communities.” (ACC, Industrial Goods and Services) > > “We're all trying to get our heads round what our personal and corporate responsibility is for helping to save the planet, but at the same time, there is a big difference between a natural resources company, for example, which have a different impact on the environment than perhaps a media company whose impact is partly direct but in a lot of ways indirect.” (ACC, Media)

In the banking and investment sectors, some ACCs found reporting on ESG difficult as they have to collect data on the companies they are investing in; this is made more complex if companies are in emerging markets. These ACCs described their companies as being in a transitional period when it comes to ESG, they outlined the need for 'time and space' to change practices, rather than increasing reporting demands.

Several also mentioned a concern about ESG reporting potentially hindering profit-making activities, meaning that businesses can face conflict in fulfilling their responsibility towards shareholders.

> “I think the holy grail is to find something that's ESG-friendly and equally profitable and that's what businesses are all trying to do.” (ACC, Insurance)

ACCs in the extractive industry reported their companies take all elements of ESG very seriously. The 'social' component is particularly prominent as activities in the communities in which companies operate helps to ensure they have a “licence to operate".

> “Lot of times, towns are built next to the mines, so the companies often have to provide the town with schooling and healthcare... S definitely means being good to the communities the companies operate in" (ACC, Basic Resources)

Examples of common ESG activities

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Liability

No party accepts any liability for any loss, damage or costs howsoever arising, whether directly or indirectly, whether in contract, tort or otherwise from any action or decision taken (or not taken) as a result of any person relying on or otherwise using this publication or arising from any omission from it.

Executive summary

Views and reflections on ESG

The majority of ACCs in this study viewed ESG as an important part of good business practice. Many ACCs stated that ESG has increased in importance in the last few years, both within their organisations and across industries. The Covid-19 pandemic was a trigger for both awareness and engagement in ESG, as environmental and social issues came to the forefront, for example around working from home practices and staff well-being levels.

The ACCs interviewed all showed an interest in ESG and a good understanding of the ESG activities undertaken in their organisations, such as initiatives aiming to reduce plastic use, carbon emissions and increase charity engagement and board diversity. However, many are not directly involved in the decision-making processes, especially in relation to environment and social elements; and when organisations have in-house environment and social experts or sub-committees. It was noted that ACCs' main role is related to risk and compliance, as well as ensuring ESG is effectively reported on, rather than deciding on what to implement and how.

For some ACCs, the components of ESG were seen to be connected and work harmoniously with one another. However, a small number of ACCs felt tensions can arise when trying to prioritise ESG activities with profit-making responsibilities, especially in relation to environmental activities.

Some ACCs reflected on how the success of ESG can be dependent on executive management's interest levels and the company's access to ESG resources. Similarly, it was noted by a few ACCs that if current and potential shareholders have an interest in ESG it tends to influence the business' attitude towards the framework and give greater importance to the company's efforts. A few ACCs reflected that any cynicism tends to be focused on environment and social elements, as governance is well established and part of the Corporate Governance Code.

Environment

Some ACCs said that the environment has been prioritised over the other ESG areas in the last couple of years. Environment activities undertaken are wide ranging, depending on the sector, operating markets, and size of the company. Many organisations are trying to reduce their carbon emissions, workplace plastic use and encourage staff to cycle or walk to work.

The Task Force on Climate Related Disclosures (TCFD) was well known amongst the ACCs in the study, with TCFD recommendations being implemented by most. Those in larger companies tended to be most familiar with TCFD's targets and better able to fulfil its requirements due to the resources they have at their disposal. There were mixed attitudes towards TCFD, including a small number of negative reactions around continual changes to reporting standards. Alongside this, there were concerns from a few ACCs around the extended time and costs required for smaller businesses to comply with the recommendations.

Social

The importance of the social component was reported by some ACCs to be increasing, especially regarding board and senior management diversity, staff wellbeing and equal pay. Some ACCs reflected that the expansion of social activities is driven in part by societal shifts, in turn making investors more interested in companies' social policies and activities and motivating companies to place a greater focus on their social activities and reporting. Furthermore, many ACCs recognised the important role the social component plays in employee retention and attracting high quality and diverse employees.

Governance

All ACCs felt they had a firm understanding of governance activities, issues, and risks, as these activities and measures are well established. Compared with the environment and social components, it is felt to be easier to define what activities, risks and issues have to, or should, be reported on due to the Corporate Governance Code (CGC). Pay transparency, succession planning, remuneration and bonuses of c-suite and board members were noted by some ACCs to have grown in importance for both investors and employees in the last few years.

Measuring and reporting on ESG

Some ACCs reflected that ESG was 'too broad' and that it continues to evolve and grow rapidly, which can make the measurement of ESG activities difficult and inconsistent across sectors and markets. Some ACCs said that it can be especially challenging to measure and report on environmental activities, particularly indirect emissions (scope 3) and the impacts on markets outside the UK and Europe.

Many ACCs felt that the increased focus on ESG in reporting was making annual reports longer and longer, thereby making it harder to identify key information. A small number were concerned that the detailed reporting requirements could lead to performative policies, rather than authentic ones which are embedded into business practice. Finally, some ACCs had time and cost concerns around reporting on ESG, especially those from organisations who do not have sufficient resources or dedicated environment and social audit specialists.

Many ACCs commented that the guidance on ESG related activities, and how to measure them, is complex to navigate - particularly for businesses with limited resources, those who operate across markets and those who have only recently begun to invest time into environment and social activities.

When asked what role the FRC could play, some, mainly from smaller organisations, said that they would welcome more practical guidance that is sector specific, especially related to measuring environment and social activities. Some ACCs would also welcome best practice examples to ensure ESG reporting is salient and meaningful, rather than adding more reporting requirements.

Research background and context

Research aims

Audit Committees play a vital role in ensuring audits are conducted to high standards. The Financial Reporting Council (FRC) engages with Audit Committee Chairs (ACCs), often through third parties, to inform their work and improve the quality of audits.

Both qualitative and quantitative research has been conducted with ACCs previously on the topic of audit quality by YouGov for the FRC, with studies completed in 2015, 2020 and 2021/22.

The FRC wanted to build upon this work, with the aim of furthering its understanding of ACCs' views on, and approach to, Environmental, Social and Governance (ESG) activity and reporting. YouGov, an independent research agency, was subsequently commissioned to conduct 40 qualitative interviews (lasting 45 – 60 minutes) with ACCs of Public Interest Entities (PIEs).

As in previous years, the research was conducted with a wide range of ACCs from different organisations (e.g., FTSE 100, FTSE 250, other listed equity, building societies, unlisted banks) and from a range of sectors. Some ACCs sat on the boards of multiple companies and referred to their experiences across these companies during interviews.

Recruitment summary

The table below outlines a recruitment summary according to organisation type. Interviews were conducted between November 2022 and March 2023. All quotations within this report include the organisation type and sector of the ACC.

Table 1: Summary by market

Organisation type	Number of interviews
FTSE 100	11
FTSE 250	18
Other listed	9
Unlisted entities	2
TOTAL	40

Sector	Number of interviews
Financial Services	8
Insurance	5
Healthcare	4
Industrial Goods and Services	4
Banks	4
Tech and Telecoms	4
Consumer Products and Services	3
Basic Resources	3
Real Estate	1
Chemicals	1
Construction and Materials	1
Travel and Leisure	1
Food, Beverage, and Tobacco	1
TOTAL	40