Corporate governance plays a crucial role in ensuring a successful and sustainable business and is key to our long-term success. That’s why we’ve put in place the right frameworks to ensure we comply with the UK Corporate Governance Code.
Code Compliance
The Pearson Board is responsible for ensuring that the Group has in place appropriate frameworks to comply with the Code’s requirements. Corporate governance is at the heart of our decision-making and helps us to fulfil our purpose and values.
The principles set out in the Code emphasise the value of good corporate governance to the long-term sustainable success of listed companies. These principles, and their supporting provisions, cover five broad themes.
Our code compliance schedule
NYSE Listing
As a listed non-US issuer, Pearson is required to comply with the corporate governance practices of listed companies set out under the New York Stock Exchange's listing standards, which is enforced by the US Securities and Exchange Commission. Pearson is required to comply with some of the rules, and otherwise must disclose any significant ways in which our corporate governance practices differ from those followed by US companies under the NYSE listing standards.
At this time, the Company believes that it is in compliance in all material respects with all the NYSE rules except that the Nomination & Governance Committee is not composed entirely of independent directors as the Chair, who is not considered independent under NYSE rules, is a member of the Committee in addition to independent directors.
Section 172 of the Companies Act
In summary, as required by Section 172 of the Companies Act 2006, a director of a company must act in the way he considers, in good faith, would most likely promote the success of the company for the benefit of its shareholders. In doing this, the director must have regard, among other matters, to:
Subsidiary Governance
In accordance with Section 172 of the Companies Act 2006, the Directors of both the plc and of our subsidiary companies fulfil their duties to promote the success of the company through a well-established governance framework. Typically, in large and complex businesses such as Pearson, this framework includes delegation of day-to-day decision-making to employees of the Group.
This governance framework is far more than a simple delegation of financial authority, and includes the values and behaviours expected of our employees and business partners, including the standards to which they must adhere; how we engage with stakeholders, including to understand and take into account their views and concerns; and how the Boards look to ensure that we have a robust system of control and assurance processes in place.
