Deloitte's review of S&P 500 company proxy statements filed between October 1, 2019, and September 30, 2020, revealed the Nom/Gov committee as the most common ESG board oversight body; however, a significant 10% disclosed board-level ESG/sustainability committee oversight and 28% of proxies did not include any disclosure on the board ESG oversight structure, as shown here:
ESG oversight committee names expectedly vary and include: Corporate Social Responsibility and Sustainability Committee; Governance and Public Responsibility Committee; Public Policy and Sustainability Committee; Environmental, Safety, and Sustainability Committee; Sustainability Committee; Sustainability and Innovation Committee; Technology, Environmental, Safety, and Security Committee; Corporate Responsibility Committee; and Public Responsibility Committee.As is the case with many governance practices, oversight structures reflect industry variations. For example, energy, resources, and industrials companies are much more likely to house ESG oversight in a Health & Safety (or similar) committee, which is often non-existent in other industries such as technology, media and telecommunications companies.While the audit committee is rarely identified as the primary board ESG oversight body, the publication notes the audit committee's critical key role as respects the substance and form of ESG-related disclosure and associated internal and disclosure controls.
This post first appeared in the weekly Society Alert!