To (form an) Environmental Social Governance Committee or not to (form an) ESG Committee? That is the question (for boards)

Tom Proverbs-Garbett, Associate Director, ESG, RSM UK Consulting LLP

As ESG (environmental, social and governance) concerns continue to play a major role in business discourse, and given the breadth of the term, should boards be setting up ESG sub-committees to spend time with the detail? Is it such a hot topic that it requires whole board attention? Or is it simply a new phrase for responsible business that can be dealt with, as business-as-usual, between standing audit and risk committees? This article will explore some potential benefits and difficulties found in the use of ESG Committees, against the background of the recent publication of the Chartered Governance Institute's influential proforma terms of reference for an ESG/sustainability board committee and associated guidance. The article will review the role an ESG Committee might play in strategic governance, how its responsibilities must link to those of other committees, and the advantages and disadvantages of committee creation. The purpose of the article is to assist board members and their executive teams in discussion of these general issues in the context of what works for their organisation.

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UK Environment Consultant June 2024 Vol.17, No. 67, Spring 2024

Tom Proverbs-Garbett

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Tom is a corporate governance specialist, working in the ESG team of RSM UK Consulting LLP. He is a Fellow of the Chartered Governance Institute and honorary secretary of the West Midlands Branch. He is also a Fellow of the Institute of Corporate Responsibility and Sustainability. His consulting practice focusses on all aspects of governance, in the context of ESG and generally, particularly in the context of board effectiveness, directors' duties and board behaviours. Previously a solicitor at a top-20 law firm, Tom led its UK governance and company secretarial function. He provides training for boards and individual directors and their executive reports. A regular adviser at board meetings, Tom has acted as company secretary for clients, including for joint venture entities. He regularly conducts governance framework and board effectiveness reviews, where committee constitution and use is a critical consideration. Tom has an MBA and post-graduate degrees in law and education. He publishes regularly on governance matters.

RSM UK Consulting LLP

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RSM UK Consulting LLP sits within the wider RSM UK framework. RSM is a leading audit, tax and consulting firm to the middle market with 4,700 partners and staff operating from 31 locations throughout the UK. For the year ending 31 March 2023, RSM generated revenues of £486m. RSM UK is a member firm of RSM International - the sixth largest network of audit, tax and consulting firms globally. The network spans more than 120 countries, 860 offices and 57,000 people, with a fee income of $8bn. RSM delivers the big ideas and services that help middle market organisations thrive, helping clients move forward with confidence and realise their full potential.

UK Environment Consultant June 2024 Vol.17, No. 67, Spring 2024

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