Our Governance

Governance and transparency

Discover more about how our governance structure and risk management processes help build trust and enhance our transparency.

Samantha Barras

Hear Samantha Barrass, Independent Non Executive, reflect on her first twelve months on PwC’s Public Interest Body

Hear Samantha Barrass, Independent Non Executive, reflect on her first twelve months on PwC’s Public Interest Body

Reflections: why governance and transparency is important

A culture of transparency and robust governance is critical to enabling us to deliver our purpose - building trust in society and solving important problems. Explore the different roles our governance bodies play across our firm as we shine a spotlight on the audit practice. We also explain how we evolve our structures with a focus on risk governance, and publish our principal risks and executive remuneration to enable our stakeholders to better understand how we run our business.

Watch Samantha Barrass, Independent Non Executive, reflect on her first twelve months on PwC’s Public Interest Body as she shares her views on why governance and transparency is important.

Kevin Ellis

Watch Kevin Ellis, Chairman and Senior Partner provide an overview of our governance structure

Watch Kevin Ellis, Chairman and Senior Partner provide an overview of our governance structure

Kevin Ellis, Hemione Hudson, Lord Gus O'Donnell and Chris Burns

Hear about the different roles our governance bodies play in taking decisions using a real life example - our Programme to Enhance Audit Quality

Hear about the different roles our governance bodies play in taking decisions using a real life example - our Programme to Enhance Audit Quality

Our governance and how we take decisions

We are a large partnership governed and managed by three main bodies each with a different role and responsibility.

The Management Board is our executive body responsible for the long term strategy of the firm and focused on delivering for our clients, our people and our external stakeholders in line with our purpose. Its membership includes the Executive Board who are responsible for the day to day leadership of the firm, and the Clients and Markets Executive who bring the industry and markets perspective direct from the business. Together the Management Board enables us to bring high quality services across our Audit, Consulting, Deals, Risk Assurance and Tax practices to deliver our strategy for all of our stakeholders.

The Supervisory Board is an oversight body comprised of elected partners from across our business and is designed to represent the interests of their peers who invest in the firm. Members of the Supervisory Board fulfil their responsibilities by listening to the feedback from the partnership and providing guidance or challenge to the executive on their behalf.

Our third governance body is the Public Interest Body, which has a majority of Independent Non Executives with a specific purpose to enhance confidence in the public interest aspects of our firm’s strategy and decision making. It oversees our business and holds our executive to account to ensure the public interest remains at the heart of our business activities.

We are constantly looking at ways
to provide greater clarity
about who we are, what we do
and how we do it.

Margaret Cole and Sir Ian Gibson

Watch Margaret Cole, Chief Risk Officer and General Counsel in discussion with Sir Ian Gibson, Independent Non Executive

Watch Margaret Cole, Chief Risk Officer and General Counsel in discussion with Sir Ian Gibson, Independent Non Executive

Evolving our governance - a focus on risk

As the leading professional services firm we believe in continual improvement and always look for ways to enhance our governance practices. Watch Margaret Cole, Chief Risk Officer and General Counsel in discussion with Sir Ian Gibson, Independent Non Executive member of the Public Interest Body. Hear them talk about how we have evolved our approach to risk management to reflect the changing external environment and increasing expectations from our stakeholders around transparency.

Managing risk

Managing risk is a clear strategic priority for the Management Board and senior management of the firm.

Summarised below are the principal risks faced by our business and the management response. Find out more about our approach or select a risk.

We have a clear business strategy, and in implementing this, it is vital we manage the associated risks. As a result we have a defined process for identifying, assessing, monitoring and controlling risk which is implemented via a three lines of defence model.

The Management Board takes overall responsibility for establishing systems of internal control and for reviewing and evaluating their effectiveness. To support the Management Board in the execution of their responsibilities, executive oversight activities are delegated to a committee of the Management Board chaired by the firm’s Chief Risk Officer. Day-to-day responsibility for implementation of these systems and for ongoing monitoring of risk and the effectiveness of controls rests with senior management.

Our risk management governance arrangements and internal controls have evolved across the financial year, and a summary of key activities for FY19 include:

  • An annual risk and control assessment by each line of service - generating a report for our senior executive risk body to assess and oversee aggregate risk exposure and management.
  • Transition from the Risk Council to the Executive Risk Committee - the newly established senior executive risk body responsible for firm-wide risk oversight on behalf of the Management Board.
  • Periodic reviews of performance and quality - carried out independently by the PwC network.
  • Internal audit effectiveness reviews of the financial and operational systems and controls across the firm - reporting to the Executive Board and the Supervisory Board Audit Committee and Risk Committee on relevant matters.
  • Oversight of our professional services risk management systems by our central risk and quality functions.
  • Annual risk reviews of all audit clients.

We take client acceptance procedures extremely seriously and we do not automatically take on new client engagements or new work for existing clients. We have procedures to understand who we work with and the nature of the work requested both at the outset and through the lifecycle of our projects. This helps us to assess the relevant associated risks (including but not limited to compliance with independence requirements and potential conflicts of interest) which is central to protecting our reputation for quality.

Internal control assessment

Our internal control systems are designed to manage, rather than eliminate, the risk of failure to achieve business objectives or, in the case of financial controls, the risk of material misstatement in our financial statements. Accordingly, they provide reasonable, but not absolute assurance against such failure or material misstatement.

The Executive Board has reviewed the systems of internal control in operation during the year and is satisfied with their effectiveness.

Building trust and being transparent

At PwC we believe we build trust by acting ethically, with integrity and fairness, to do the right thing. Our leadership sets the tone from the top and this mindset is reinforced by our culture and values: to act with integrity, make a difference, care, work together and reimagine the possible.

That’s why we aim to give our stakeholders transparency across a diverse range of key topics that are important to them, including:

  • Audit - which is at the heart of our business and our public interest responsibilities. To find out how we approach quality, our ethical requirements and policies see our Transparency Report.
  • Our approach to setting executive remuneration.
  • Making a constructive contribution to policy debates domestically and internationally.
  • Setting our firm’s tax strategy which includes our Total Tax Contribution for FY19 and our approach to managing risk and developing good governance in relation to tax.
  • Governance of the firm’s cyber operations and resilience led by Warwick Hunt, Managing Partner and COO and supported by our UK Chief Information Security Officer.

Further information on cyber governance, other relevant ethical requirements and details in relation to our continuous improvement approach to our policies and procedures, (in light of internal priorities or changes in the market) can be found in the Transparency Report.

Our leadership sets the tone from the
top and this mindset is reinforced
by our culture and values

Executive remuneration

As part of our commitment to transparency we publish details of our executive pay. Our partner remuneration is determined through a fair, robust and transparent income system aligned with the firm’s vision, culture and performance ambitions. Individual profit per partner depends on the overall profitability of the firm and is based on a number of factors including responsibility and performance across the firm’s strategic priorities. Remuneration for members of the Management Board is overseen by the Talent and Remuneration Committee. We’ve tracked our average profit per partner in relation to our average UK salary for a number of years, this enables us to ensure we are balancing being fair to our people with rewarding strong business performance. Find out more here.

£765,000

7%

Distributable profit per partner

13.6

Multiple of average employee pay and bonus to average partner profits

£3.7m

FY18: £3.4m

Chairman’s distributable profit share

£23.8m

FY18: £21.6m

Estimated Management Board distributable profit share

Downloads

Financial statements

Download full details of our financial performance for the year ending 30 June 2019 in our financial statements

Transparency report

Download full details of how we are building trust through external audit in our 2019 Transparency Report

Our non-financial scorecard

Download full details of progress against our purpose-related metrics in our 2019 non-financial scorecard

Contact us

Annual Report enquiries

Corporate Affairs, PwC United Kingdom Email
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2019 assets

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