Public Interest Committee - Terms of Reference
Public Interest Committee (the ‘Committee’ or the ‘PIC’)
Terms of Reference
Membership
The Committee shall comprise of:
- All the Independent non-executive (INE) members of the Oversight Committee.
- The members of the OC
In addition to the Committee members, each meeting the following individuals should be invited to attend:
- The Managing Partner
- Head of Risk
- Firm’s Ethics Partner
- Head of Audit
The Firm’s Finance Director, Head of HR, Head of IT or any other Head of department or service line may be invited to attend all or part of any meeting.
The Secretary to the Management Board shall act as Secretary to the Committee and provide support as required.
The Oversight Committee shall appoint the Chair of the Committee who shall also be an INE. In the absence of the Committee Chair, the remaining members present shall elect one of themselves to chair the meeting.
Meetings and attendance
The Committee shall meet a minimum of two times per year. Further meetings may be called by any member of the Committee if required.
The quorum for meetings shall be two thirds of members.
Notice of each meeting confirming the venue, time, and date, together with an agenda of items to be discussed, shall be made available to each member of the Committee in sufficient time to enable consideration of the issues.
Supporting papers will be made available in electronic form to Committee members.
Meetings can be held physically or virtually.
Only members of the PIC have the right to attend meetings. Other guests (both internal and external to the Firm) may attend by invitation of the Chair.
Role and responsibilities
The primary focus of the PIC is to enhance stakeholder confidence in the public interest aspects of the firm’s activities. As such, the Committee shall oversee the firm’s policies and procedures for promoting quality, ensure the protection of the firm’s reputation, and reduce the risk of firm failure. In addition, the Committee will be responsible for engaging, together with the firm’s Management Board, in dialogue with the Regulator, external stakeholders and representatives of shareholders of public interest entities.
As such, the Committee shall carry out the following:
- Audit: At each meeting, receive an update from the Head of Audit and the Chair of the Audit Quality Board (AQB) on audit quality, updates on developments with the FRC on AQR’s, updates on developments with the ICAEW on QAD reviews, and actions arising from these.
- It will also review the status of, and significant findings from, any regulatory violations and compliance breaches that have occurred in the period.
- Ethics: At each meeting, receive updates from the Ethics Partner on the firm’s key policies and procedures (insofar as they impact on the public interest aspects of the firm’s activities) relating to ethics, and any associated risk management, regulatory or reputational matters. This should include the latest developments on those matters both externally, and within the firm.
- Quality matters: At least annually, receive and update from the Head of Risk on the firm’s key policies and procedures (insofar as they impact on the public interest aspects of the firm’s activities) relating to quality matters, and any associated risk management, regulatory or reputational matters. This should include the latest developments on those matters both externally, and within the firm. The committee should also receive a summary report on the key activities and protocols of the Engagement Risk Acceptance Panel (ERAP).
- Whistleblowing: a review of Whistleblowing reports should be conducted at each meeting.
- Financial crime: Receive and provide comment on a report from the firm’s MLRO at least annually.
- People: At least annually, meet with the Head of HR to consider and provide comment/recommendations on the firm’s people policies and procedures, including a review of employee survey results and employee relations data. For the Audit practice specifically, the Committee shall also receive an update on significant policy changes and culture change initiatives, as well as receive the indicators and metrics relating to the monitoring of people matters including (but not limited to) recruitment and retention, learning and development, reward and resourcing.
- Audit Firm Governance Code (AFGC): Receive an annual report from the Management Board detailing how the firm has met its various obligations under the Audit Firm Governance Code. This should include how the firm has ensured compliance with its of Code of Conduct.
Reporting
Minutes of the Committee shall be made available to the Oversight Committee.
The Chair of the Committee shall report to the Oversight Committee following the meeting of the Committee.
These terms of reference shall be made available to all partners and published on the firm’s external website as required by the Regulator.
The Committee shall ensure it reviews its own effectiveness annually as part of the wider self-appraisal process conducted by the Oversight Committee, including a review of its composition and these terms of reference.
Other matters
The Committee is authorised by the Oversight Committee to investigate any activity within its terms of reference and seek any information that it requires from any partner or employee of the firm to conduct its work. As such, the Committee will also:
- Consider any other matters that may affect the public interest, including relevant matters relating to the Baker Tilly network
- Provide comment on the INE Report for the Transparency Report
- Attend periodic meetings with representatives of the Financial Reporting Council and other regulatory authorities as required
- Attend periodic meetings with representatives of shareholders of public interest entities
- Input, as it becomes relevant, into the process of succession planning of the firm’s INEs including their onboarding, induction and ongoing training and development
