MF updated the Board on the Audit and Risk Committee’s activities since the previous meeting, highlighting:
• ongoing engagement with the Scottish Government iTECS team regarding cyber security
• completion of the deep dive review into third party contracts, which focused on risk, value and sustainability
• the 2024/25 internal audit plan, which includes reviews of ESS’ risk management and performance reporting processes
MF noted updates to governance arrangements for the Committee, reporting that:
• RD will remain on the Committee while also performing the role of Acting Chair of the Board
• MS has been appointed as Deputy Chair of the Committee
• the Committee would draw on a nominated Board member to join the Committee should the need arise
The Board agreed these actions.
RP presented an update on final expenditure for 2023/24, noting that underspend continues to decrease year-on-year, but due to lower-than-expected costs for the office retrofit supplied by a local, small to medium-sized enterprise, the 2023/24 underspend was slightly higher than projected.
RP also noted that a reforecast budget for 2024/25 would be brought to the Committee for discussion, to consider in particular the resource in place for staffing and external advice, and milestone planning for in-year returns where applicable. The Board agreed to consider the refreshed budget by correspondence.
Action: to circulate the revised 2024/25 budget for approval by correspondence.
CL introduced the annual review of the Audit and Risk Committee Terms of Reference and the Board’s Standing Orders, summarising Committee discussions on its membership, and quorum of both the Committee and the Board. The Board agreed the recommended updates and noted that work is underway regarding a specific scheme of delegation.
CL presented updates to ESS’ corporate risk register, highlighting:
• increases to residual scoring regarding resource requirements and the recruitment of a permanent Chair
• the finalised role briefs for Equality, Cyber and Sustainability Champions
• recommendations to appoint a Board Sustainability Champion
In discussion the Board approved the updates to the register and agreed the appointment of CS as Sustainability Champion.
MS provided an verbal update as the Board’s Cyber Champion, highlighting the importance of cyber awareness on the Board and some of the activities that Champions will undertake to promote this across ESS.
CL presented a high-level review of ESS’ Risk Management Framework and Policy, noting that only minor updates were recommended as a fuller review of ESS’ risk management approach would take place during development of the next Strategic Plan. The Board approved the updates.
CL presented the annual assessment of risk maturity, which the Executive Team had agreed as ‘managed’ due to positive efforts at corporate-level to implement and review risk processes. The Board noted that areas for improvement related to embedding risk management across all levels of the organisation.
CL presented ESS’ final performance and management indicators (PMIs) and accompanying narrative for the 2023/24 financial year, noting that these will be publicly reported in ESS’ next Annual Report and Accounts. The Board discussed successes and considered approaches to less frequently reported PMIs such as the long-term outcome and stakeholder perception.
