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Committees

2020 UK Spencer Stuart Board Index

2020 Snapshot

 29 %

of boards have an ESG-related committee

 26 %

of boards have a standalone risk committee

 56 %

of remuneration committees are chaired by women

 62 %

of audit committee members have CFO experience

The three obligatory committees — audit, remuneration, and nomination — continue to constitute the core committees across all companies. 55% of companies have more than three committees and no company this year has more than six.

Beyond the core committees, 29% of companies have established an ESG-related committee, although committees concerned with ESG/CSR have many different names. We define ESG-related committees as those that oversee the company’s environmental and social/community-related activities. Among the companies with ESG-related committees, 63% are in the industrial sector, followed by 23% in consumer, 5% in healthcare and in technology, media and telecoms, and only 2% in the financial service sector. The full list of committees for each FTSE 150 company can be viewed in our searchable committees table.

26% of companies now have a separate risk committee (up from 17% last year). 31% of these are outside the financial services sector (vs 20% last year).

Our perspective

The global pandemic has heightened the importance of crisis and risk management capabilities. In future, the risk register should not just concentrate on high frequency events. The biggest existential threats may be infrequent, but they are high impact. We therefore anticipate the creation of more standalone risk committees. If this crisis has taught boards anything, it is that they must think more holistically, make room for the unexpected, and avoid running the business too hot, committing every resource and taking too much money out of the business.

FTSE 150 board committees

Number of committees
Percentage of companies
3 committees 44%
4 committees 34%
5 committees 17%
6 committees 5%
Committee type
Percentage of companies
Audit 100%
Remuneration 99%
Nomination 99%
ESG-related 29%
Risk 26%

Audit committee

26% of audit committee chairs in the sample are female, a slight increase. Softcat is the only company where all members of the audit committee are women. By contrast, six companies in our sample do not have any female representation in the audit committee.

Just one chair of audit is identified as BAME and 18% of audit committee chairs are non-nationals (vs 21% in 2019).

CFO experience continues to be the most common background for audit committee members, although that figure has dropped to 62% from 69% last year.

Remuneration committee

Continuing last year’s upward trend, 56% of remuneration committees are now chaired by women (up from 52% last year). Five companies in the sample still have no female representation on the remuneration committee.

Currently, there is only one director identified as BAME chairing a remuneration committee.

Fees for committee members and chairs

Audit committee

The average audit committee membership chair retainer is £24,976 (in 2019 was £24,731), and the membership retainer is £15,879. Only TUI and Polymetal International pay a fee for audit committee meeting attendance in addition to a membership fee.

Audit committee chair retainers range from £5,000 (Genus) to £110,502 (TUI). Audit committee membership retainers range from £3,000 (IG Group Holdings) to £40,000 (HSBC Holdings). 59% of the companies in the sample do not pay a fee for audit committee membership

Remuneration committee

The average retainer for remuneration committee chairs is £21,937, ranging from £5,000 (Genus) to £75,000 (HSBC Holdings).The average retainer for remuneration committee membership is £13,475, ranging from £3,000 (IG Group Holdings) to £40,000 (HSBC Holdings)

39% of the companies in the sample offer a remuneration membership retainer. Polymetal International is the only company which offers a per-meeting fee on top of the membership retainer.

Other committees

Risk committee chairs tend to have the highest retainers of any committee chairs, with an average £39,281. HSBC Holdings pays the highest (£150,000).

The average retainer for chairs of ESG-related committees is £23,377 (we define ESG-related committees as those that oversee the company’s environmental and social/community-related activities).

Committee chair fees
Audit committee Remuneration committee
Fee unknown 1.3% 0%
No additional fee 3.3% 5.3%
Below £10,000 4% 5%
£10,000 to £19,999 40.7% 45.6%
£20,000 to £29,999 23.3% 18.7%
£30,000 to £39,999 12.7% 17.3%
£40,000 and above 14.7% 8%