Experian Annual Report 2023
Year ended 31 March 2023
Helping people
on their
thrive
financial journey
Big problems
And little ones.
Creating better tomorrows
jobs to get done.
solved.
every day.
Enabling
Financial highlights
1
From ongoing activities.
The results for the year ended 31 March 2022 have been re-presented for the reclassification to exited business activities of certain
B2B businesses. See Note 10a(i) to the Group financial statements for Revenue – ongoing activities and Benchmark EBIT re-presentation.
Statutory
Growth % at
actual FX
rates
Revenue
US$
6,619
m
+5%
(2022: US$6,288m)
Operating profit
US$
1,265
m
-11%
(2022: US$1,416m)
Profit before tax
US$
1,174
m
-19%
(2022: US$1,447m)
Basic EPS
USc
84.2
-34%
(2022: USc127.5)
Benchmark
Growth % at
actual FX
rates
Growth % at
constant FX
rates
Revenue – ongoing activities
US$
6,587
m
+6%
+8%
(2022: US$6,216m)
Benchmark EBIT
1
US$
1,802
m
+9%
+9%
(2022: US$1,653m)
Benchmark profit before tax
US$
1,670
m
+9%
+9%
(2022: US$1,535m)
Benchmark EPS
USc
135.1
+9%
+9%
(2022: USc124.5)
Reconciliation of statutory to Benchmark measures
Year ended
31 March 2023
Statutory
Non-benchmark items
Benchmark
Investment-
related items
Goodwill
impairment
Amortisation
of acquisition
intangibles
Non-cash
financing
items
Exceptional
items
6,587
–
–
–
–
–
6,587
Ongoing
32
–
–
–
–
–
32
Exited
Revenue
US$m
6,619
–
–
–
–
–
6,619
Revenue
US$m
1,273
92
179
192
–
66
1,802
Ongoing
(8)
–
–
–
–
–
(8)
Exited
Operating
profit US$m
1,265
92
179
192
–
66
1,794
Benchmark
EBIT US$m
Profit before
tax US$m
1,174
109
179
192
(50)
66
1,670
Benchmark
PBT US$m
Basic EPS
USc
84.2
10.2
19.7
15.4
(4.5)
10.1
135.1
Benchmark
EPS USc
See note 7 to the Group financial statements for definitions of non-GAAP measures.
Contents
Strategic report
04
Experian at a glance
06
Chair’s statement
08
Chief Executive’s review
14
Our investment case
16
Stakeholder engagement
20
Key performance indicators
22
Our business model
28
Our strategy
Sustainable business
36
Environmental, social and governance
42
Improving financial health for all
45
Treating data with respect
51
Inspiring and supporting our people
54
Working with integrity
56
Protecting the environment
64
Non-financial information and
s172(1) statement
66
Financial review
78
Risk management and principal risks
86
Viability and going concern
Governance
89
Chair’s introduction
92
Board of directors
94
Corporate governance report
108 Nomination and Corporate Governance
Committee report
113 Audit Committee report
121 Report on directors’ remuneration
146 Directors’ report
Financial statements
149 Financial statements contents
150 Independent auditor’s report
Group financial statements
162 Group income statement
163 Group statement of comprehensive
income
164 Group balance sheet
165 Group statement of changes in equity
166 Group cash flow statement
167 Notes to the Group financial statements
Company financial statements
226 Company financial statements
229 Notes to the Company financial
statements
242
Shareholder and corporate information
244
Glossary
Roundings
Certain data has been rounded in this report. As a result, the
totals of data presented may vary slightly from the actual
arithmetic totals of the data.
Exchange rates
Principal exchange rates used are given in note 11 to the
Group financial statements. The average pound sterling
to US dollar rate is 1.20 (2022: 1.37).
To download this Annual Report and
our other corporate literature visit
www.experianplc.com
Experian plc
Strategic report
2
We delivered very strong financial
results this year
, with growth in
every region, building on our long
track record of success.
We have invested in our business to drive that success and
build resilience and strong growth.
Powerful market trends, such as digitisation and consumer
empowerment, provide us with the growth opportunities to
drive our business forward. We are focused on enhancing
and differentiating our data, extending the reach and scope
of our products, expanding into new verticals and
empowering consumers.
Our success is built on great innovation, building great new
products and adding exciting new features that help meet
more client and consumer needs, giving them the opportunity
to achieve their goals and thrive. All of this is enabled by the
outstanding dedication and commitment of an amazing team
of 22,000 people worldwide who strive every day to make
our company great.
We are excited by the opportunities ahead and look forward
to creating even more value for our shareholders.
Brian Cassin
Chief Executive Officer
3
Experian plc
Annual Report 2023
Strategic report
Transforming lives and delivering better outcomes
for people, for businesses and for our communities
is central to what we do and how we operate.
We start with the needs of consumers and businesses,
working with them to find new ways to solve their
problems and make their lives easier.
We help people to save money and protect their
identities. We help businesses to run more efficiently,
while managing risk and compliance.
We unlock the power of data through advanced analytics
and world-leading platforms, which turn data into
information and actionable strategies.
As well as supporting consumers, we operate across
a range of industries, from healthcare to agribusiness,
from automotive to financial services, and many more.
We have a collaborative and inclusive culture which
champions innovation. Great people who build great
products. We are Experian.
Experian at a glance
Serving a
of client and consumer needs
wide array
Leading with purpose
Saving money
Lower your bills and
save money, stress free
See pages 34 to 35
Debt relief
Back to living in peace
See page 44
Prevention of fraud
Shopping made safe using
artificial intelligence
See pages 30 to 31
Business strategy
Transforming businesses
and driving growth
See pages 26 to 27
Financial identity
Financial freedom
for the unbanked
See page 50
Agricultural intelligence
Helping farmers focus
on farming
See pages 32 to 33
Identity checking
Lenders saying yes
to more borrowers
See page 77
Patient claims
Removing the sting
from healthcare claims
See page 63
Experian plc
Strategic report
4
We are creating a better tomorrow
to all
bringing financial power
Helping people thrive at every
stage of their financial journey
Our strong focus on environmental, social and
governance risks and opportunities is making
a real difference to people’s lives, it’s helping
to grow our business and fulfil our purpose
of creating a better tomorrow.
Good growth and a
healthy financial position
We made strong progress over the past 12
months. We delivered new products, opened
new markets and provided more value to our
consumer members. Our financial position
remains strong with ample liquidity and
stable debt levels.
Inspiring and supporting
our people
Culture is really important to us. We thrive in
a diverse and inclusive culture built around a
spirit of collaboration and freedom to do the
right thing. We work together to innovate and
solve problems for clients and consumers,
quickly, accurately and in a thoughtful way.
Good governance fostering trust
Good governance is crucial to delivering the
long-term success of our business. It holds
us accountable as a business and fosters
trust with our stakeholders. The Board
provides such governance. It oversees the
Group’s strategy, operations and governance.
It challenges, supports and guides the
executive team and the business.
A stronger, more
advantaged Experian
We work at pace, pursue the biggest
opportunities, and address the highest-growth
customer segments. We invest behind our key
strategic growth initiatives, driving innovation
and strengthening our competitive advantage.
Learn more in our Sustainable
business section, pages 36 to 63
Learn more in the Our strategy
section, pages 28 to 35
Learn more in the Chief Executive's
review, pages 8 to 13 and the
Financial review, pages 66 to 77
Learn more in our Governance
section, pages 89 to 148
Learn more on pages 51 to 53
5
Experian plc
Annual Report 2023
Strategic report
Chair’s statement
Making a profound and positive difference
to people’s lives
We take pride in making a positive impact on
society, through how we support consumers,
clients, colleagues and communities across the
globe. We believe this approach is instrumental
to our long-term business growth and we are
very strongly committed to achieving our
environmental, social, and governance goals.
Mike Rogers
Chair
Introduction
Experian has had another strong year, driven
by growth in new markets and demand for
our innovative products. Our commitment to
empowering people to overcome financial
challenges is helping millions to achieve
greater financial confidence, by equipping
them with the resources and financial literacy
tools that can help them to navigate the
cost-of-living challenges posed by higher
inflation and interest rates.
We take immense pride in the profound and
positive difference we can make in people’s
lives when we deliver on our purpose.
Our diverse portfolio strengthens
our resilience
We harness the power of extensive and
unparalleled datasets in our markets,
integrating data into advanced solutions that
benefit businesses, individuals, and society
as a whole. With data on 1.5 billion consumers
and 201 million businesses, we possess a
deep understanding of the needs of our clients
and consumers, enabling us to develop
new products which make life easier for
consumers and more productive for our
clients. Our ever-expanding client base
is made up of diverse industries located in
various regions of the world. We offer products
that help clients make better decisions for their
businesses, regardless of what’s happening
in the economy.
Our strength comes from the diversity of our
business, which allows us to access new
growth opportunities, weather external
challenges and thrive in difficult times.
This has all helped deliver a strong track
record of financial resilience.
This year we have continued to grow and
diversify our business. We are extending our
presence in Brazil by entering segments new
to data-driven credit decisioning, including
our expanding work in the farming and
agricultural sector. We have built an auto
insurance marketplace in the USA to help
drivers shop around for cheaper deals on their
car insurance. And we are further expanding
into the income and employment verification
market in both the USA and UK to support
clients with their lending decisions.
Innovation
Whether in finance, healthcare, advertising
or automotive, we are always looking for
innovative ways to help our clients. We
leverage artificial intelligence (AI) and machine
learning across a broad spectrum, such
as fraud prevention or healthcare, to help
clients be more predictive and reduce risk.
In healthcare, for example, we have launched
a new product called AI Advantage which
improves the processing of healthcare claims
and makes the system more efficient for
hospitals and patients. In fraud prevention, our
Aidrian product makes shopping online safer
by blocking suspicious users, while letting
legitimate customers proceed with their
transaction, resulting in businesses
improving their revenue by up to 15%.
This year we continued to innovate with
Experian Boost, our ground-breaking free
offer, which helps consumers to provide a
fuller financial picture of themselves. Experian
Boost now also helps millions of renters
improve their credit scores. By allowing
consumers to add rent payments directly
to their Experian credit file, Experian Boost
stands apart as the only credit tool that can
positively impact a consumer's FICO credit
score instantly. This is another exciting step
forward in making financial products
accessible to more people.
Experian Go is a revolutionary tool that lets
those without a credit history establish their
financial identity with ease. Launched just over
a year ago, this service has already helped
over 130,000 people jumpstart their credit
journey and begin building their credit history,
and we are delighted it has been recognised
in the 2023 BIG Innovation Awards and by
Fast Company's World Changing Ideas 2023.
Experian plc
Strategic report
6
We have also enhanced our Experian app
in the USA, adding new ways to negotiate bills
on behalf of Experian members, helping them
save money by finding lower rates on cable
television, internet and phone bills.
We are very proud that in the USA and in Brazil
we are now recognised among the top
financial services apps.
ESG
We take pride in making a positive impact on
society, through how we support consumers,
clients, colleagues and communities across
the globe. We believe this approach is
instrumental to our long-term business
growth and we are very strongly committed
to achieving our environmental, social, and
governance (ESG) goals.
As part of our sustainable business strategy,
we have identified three UN Sustainable
Development Goals to focus our efforts on.
Our goal is to contribute meaningfully to
improving access to credit and financial
services. We achieve this through our
innovative business products, social
innovation, and community investments
that help improve financial health for all.
In Brazil, our Serasa Limpa Nome platform
continues to help people renegotiate their
debts to more manageable payment plans.
This year we helped renegotiate US$8.9bn of
debt, of which US$7.1bn was written off, to help
set even more people on the path to brighter
financial futures.
We are passionate about positively impacting
people's lives. To achieve this, we have
progressed our Social Innovation programme
that provides funding to explore innovative new
solutions that offer societal benefits and new
revenue streams. Since its launch, our current
programme has successfully reached over
100 million people, which is two years ahead
of our original target.
We recently launched our new Support Hub
in the UK to help vulnerable customers.
It helps to improve accessibility to essential
businesses for people with disabilities by
sharing their support needs with multiple
organisations all at once in a few minutes.
This eliminates the frustrating and
time-consuming process of letting each
service provider know individually, while
helping our clients meet their regulatory
requirements.
In addition to our social innovation products,
we have achieved our goal of connecting with
100 million people through our United for
Financial Health programme, a year earlier
than planned.
We are committed to playing our part in
tackling climate change, and this year we
made a significant step forward by reducing
our Scope 1 and 2 carbon emissions by 38%
from the previous year. This puts us ahead
of schedule on meeting our target to reduce
these emissions by 50% by 2030. As part of
our plans to reduce our carbon emissions,
we have increased our use of renewable
electricity from 32% to 62%. Also, as part of
our Scope 3 work in Purchased Goods and
Services, we began engaging our suppliers
regarding their carbon emissions, encouraging
them to submit their emission data to the
Carbon Disclosure Project (CDP).
People
We are passionate about supporting and
motivating our people. Our company culture
emphasises diversity and inclusivity, ensuring
that every individual's voice is heard and valued.
This creates a positive and empowering
environment where our employees can perform
to the best of their abilities.
We have been accredited as a Great Place to
Work in 22 countries, which is something we
take great pride in. The survey's results show
that 95% of our colleagues agree that everyone
is treated fairly and equitably, regardless of
their background or identity. We also see that
our positive impact on the world motivates our
people. 88% of our team members are proud
to share that they work at Experian.
Glassdoor has also validated our workplace
culture, giving us a global score of 4.4, well
exceeding the average score of 3.74. This is an
important metric for a few reasons: candidates
use Glassdoor to assess whether they want to
work at Experian, and existing employees use
it to give their views on us as an employer.
We’ve continued to make progress towards
greater diversity in leadership positions, and
now three of our five operating regions are led
by women. We’re proud that our focus on
creating an inclusive workplace has been
recognised in Equileap’s 'Top 100 Globally for
Gender Equality' for 2023, ranking us second in
the USA and 21st globally. This reflects career
and development opportunities being open to
all, our parental leave and flexible workplace,
as well as our approach to supporting diverse
suppliers and human rights protections.
Our company strives to foster an environment
where diversity, equity, and inclusion are
not just buzzwords, but intrinsic values.
By creating an inclusive and collaborative
culture, we believe that we can create a
workplace that empowers all individuals
to thrive.
Governance and Board
As a company committed to strong corporate
governance, we hold ourselves to the highest
standards set out in the 2018 UK Corporate
Governance Code. Through ongoing reviews
and assessments, we strive to go above and
beyond in creating an environment that is truly
representative of the world we live in.
The external Board evaluation undertaken
during the year attests to our first-class
governance and excellent performance.
We are pleased that our Board is now
composed of 45% women and has two
ethnically diverse board members, going
beyond the recommended guidelines for
gender and ethnic diversity outlined by the
FTSE Women Leaders Review and the
Parker Review.
I am pleased to share that we have recently
welcomed three new non-executive directors
to our Board: Kathleen DeRose, Louise
Pentland and Esther Lee. Craig Boundy, our
Chief Operating Officer (COO), also joined the
Board as an executive director. I want to thank
Deirdre Mahlan, George Rose, Dr Ruba Borno
and Kerry Williams, who stepped down from
the Board this year, for their significant
contributions to Experian.
Looking ahead to a future
filled with opportunity
This has been a year of success and
momentum as highlighted through this Annual
Report. Despite the uncertain economic
climate, our business remains resilient with
ambitious plans for expansion.
Supported by product innovation and strong
customer relationships, we achieved 7%
1
organic revenue growth and delivered 9%
growth in Benchmark EPS – an impressive
result that speaks volumes about our
unwavering commitment to excellence.
As we look to the year ahead, we are confident
that the quality of our data, continued focus
on product innovation, and our inclusive
high-performance culture will continue to
drive our success.
1
See note 7 to the Group financial statements for definitions
of non-GAAP measures.
7
Experian plc
Annual Report 2023
Strategic report
Chief Executive’s review
We delivered very strong results in FY23, reflecting
a combination of new business wins, new products
and expansion into higher growth markets.
We saw growth in every region, in many cases
outperforming our underlying markets
substantially. Total revenue growth from ongoing
activities was 6% at actual exchange rates and 8%
at constant exchange rates, and organic revenue
growth was 7%. Benchmark EBIT margin expansion
was at the top end of our expectations, helping us
to deliver Benchmark earnings per share up 9%.
Brian Cassin
Chief Executive Officer
Delivering strong and resilient growth
Revenue
US$
6.6
bn
+8%¹
Benchmark EPS
USc
135.1
+9%³
Benchmark EBIT
²
US$
1.8
bn
+9%²
1
Total revenue growth at constant exchange rates.
2
From ongoing activities, at constant exchange rates.
3
At constant exchange rates.
Highlights 2023
We delivered a very strong performance in
FY23, despite a challenging economic
backdrop in many of our markets. It was driven
by growth across all of our regions. Our past
investments in data, technology, new products,
client service and talent have enhanced our
competitive position, resulting in significant
new business wins. At the same time, the
expansion of our product portfolio has
positioned many of our businesses to address
higher growth opportunities and over the years
we have expanded existing vertical markets
and entered new segments. This is reflected
in the strong organic growth we saw in FY23,
despite deceleration in some of our
volume-based businesses. This progress also
reflects our focus on improving the
foundations of our business, a very strong
culture of innovation and a powerful social
mission to help people thrive financially. It is
also down to the hard work of our 22,000
people around the world who strive every day
to make it happen. All of this has helped us to
sustain our growth trajectory, offsetting the
effects of the slower macroeconomic
backdrop.
Very powerful structural growth trends drive
our extensive growth opportunities. With large
and growing addressable markets, we have
many opportunities for long-term growth.
In the near term, businesses need to improve
productivity, deliver better digital experiences
and build stronger customer relations, at the
same time as improving risk management,
assuring compliance and fighting fraud.
Despite short-term pressures, clients continue
to invest in these areas. Advances in
technology continue at pace and will accelerate
this. The power of our unique, proprietary
datasets, and the significant advances we
have made in the range and sophistication
of our products, has and will continue to allow
us to develop new ways to help customers to
achieve their goals, and we believe these
trends will expand our opportunity set. Our
progress is illustrated by our strong client Net
Promoter Score performance in every region,
best-in-class employee engagement, and an
increasing number of awards recognising this,
such as Fortune’s America’s Most Innovative
Companies.
So, while the coming year will likely see
headwinds in the global economy, we are very
confident in the strategic position of our
business, in the resilience of our portfolio, and
we are excited about the opportunities ahead.
Experian plc
Strategic report
8
Our performance in FY23 represented further
progress on our strategic evolution. Our
strategy is focused on enhancing the depth,
breadth, quality and uniqueness of our
datasets, to which we add advanced analytics
and other sophisticated software solutions to
address a range of client requirements, all
built on the foundations of outstanding talent,
great technology and world-class innovation.
Our solutions address a wider range of client
needs across identity, credit, fraud, compliance
and marketing, and include capabilities such
as strategy design, originations, ongoing
customer management and collections.
All of our new platforms are cloud based and
leverage advanced technologies to deliver the
best outcomes for our clients and consumers.
Increasingly, they are integrated capabilities
that combine with our datasets. More and
more of these solutions in the future will
address end-to-end capabilities, for example
being able to move seamlessly from initial
strategy design to an executable credit
decision in one platform. This brings together
the power of our data, with our industry-
leading platforms to create unique and
differentiated solutions.
A key component of our strategy is to grow and
deepen our relationships with consumers, and
we are now well on our way to becoming an
unrivalled platform for consumer finance.
These actions have positioned Experian to
address large, growing markets which we
estimate at over US$150bn in scale. Some
notable data points in FY23, opposite, highlight
the progress we are making.
Strategic highlights
Further expansion of verticals
We have further expanded our vertical
market presence with strong growth in
North America Automotive and Health,
Agribusiness in Brazil, as well as
Verification and Employer Services.
Our technology transformation
is advancing rapidly
We have signed an agreement with Amazon
Web Services (AWS) to be our preferred cloud
provider globally, which will accelerate the
rate of product innovation still further.
Data assets enriched and extended
New expanded sources and user-
permissioned data help our clients manage
credit risk and fraud prevention and
transaction categorisation. For example,
we have processed over 188 billion
consumer-permissioned transactions in our
global bureaux and are adding new sources
of data such as buy-now-pay-later records.
Ascend continues
its growth trajectory
Now with 491 clients globally and Total
Contract Value of US$471m. We are bringing
more of our data and software platforms
together and are further embedding
analytics across Experian’s broader
products and services to deliver more
solutions to clients which are uniquely
Experian.
>US$
1.0
bn
of Group revenue added from new product
capability since FY18.
Successfully repositioning Targeting
We are successfully repositioning Targeting
to address the larger addressable market
of digital identity resolution to support
marketers. Nearly 60% of North America
Targeting revenues now arise from digital
products, compared to 26% in FY19.
Consumer memberships
continue to grow
We continue to grow consumer
memberships, deepen customer relations
and deliver new products to both our free
and premium members. Free memberships
have grown to 168 million. On a like-for-like
basis, consumer membership was
145 million, up 16% year-on-year, and our
total now includes 13 million members from
Spanish Latin America.
Significant growth opportunities
in Brazil
The implementation of positive data and
other regulatory reforms in Brazil are
expanding the addressable market and
enhancing growth opportunities. We now
have c.200 positive data solutions in market
and are delivering significant growth across
data, scores, attributes, fraud, software
platforms and much more.
Consumer Services now addresses
half the Brazilian adult population
It has moved into profitability, and we are
extending our presence into new services
such as e-wallet to add functionality.
Learn more in Our strategy
See pages 28 to 35
9
Experian plc
Annual Report 2023
Strategic report
Chief Executive’s review
continued
2023
US$m
2022¹
US$m
Total growth
%
Organic growth
%
Revenue
North America
4,432
4,122
8
7
Latin America
947
791
18
16
UK and Ireland
784
847
5
5
EMEA/Asia Pacific
424
456
3
3
Ongoing activities
6,587
6,216
8
7
Exited business activities
32
72
n/a
Total
6,619
6,288
8
Benchmark EBIT
North America
1,467
1,381
6
Latin America
294
223
30
UK and Ireland
170
188
1
EMEA/Asia Pacific
14
13
8
Total operating segments
1,945
1,805
9
Central Activities – central corporate costs
(143)
(152)
n/a
Benchmark EBIT from ongoing activities
1,802
1,653
9
Exited business activities
(8)
(8)
n/a
Total Benchmark EBIT
1,794
1,645
9
Benchmark EBIT margin – ongoing activities
27.4%
26.6%
1
Results for FY22 are re-presented for the reclassification to exited business activities of certain B2B businesses. Total growth and
organic growth percentages are at constant exchange rates.
See the Financial review for analysis of revenue, See note 10(a)(ii) to the Group financial statements for the Reconciliation of revenue
from ongoing activities and Benchmark EBIT by business segment and note 7 to the Group financial statements for the definition of
non-GAAP measures including Benchmark EBIT margin.
% of Group
revenue²
Data
Decisioning
B2B³
Consumer
Services
Total
North America
67
4
7
5
11
7
Latin America
15
12
16
13
32
16
UK and Ireland
12
7
7
7
(4)
5
EMEA/Asia Pacific
6
—
13
3
n/a
3
Total global
100
5
8
6
11
7
1
At constant exchange rates.
2
Percentage of Group revenue from ongoing activities calculated based on FY23 revenue at actual exchange rates.
3
Business-to-Business (B2B) segment, consisting of Data and Decisioning business sub-divisions.
See note 10(a)(ii) to the Group financial statements for the Reconciliation of revenue from ongoing activities.
Revenue and Benchmark EBIT by region, Benchmark EBIT margin
Year-on-year % change in organic revenue¹ – for the year ended 31 March 2023
Full-year financial highlights
a
Revenue growth was in line with our
expected performance range. Total revenue
growth from ongoing activities was 6% at
actual exchange rates and 8% at constant
currency. Organic revenue growth was 7%.
Organic revenue growth is determined on
a constant currency basis and for ongoing
activities.
a
All four of our reporting regions contributed
positively to our performance. Organic
revenue growth was 7% in North America,
16% in Latin America and 5% in UK and
Ireland (UK&I). EMEA/Asia Pacific organic
revenue growth was 3%.
a
By quarter, organic revenue growth was 8%
in Q1, 8% in Q2, 6% in Q3 and 7% in Q4.
a
B2B organic revenue growth was 6%.
We saw strong client adoption of our
data-centric products, powerful analytics
and world-leading platforms as we help our
clients with their shift to digital, to optimise
profitability and better manage risk.
a
In Consumer Services organic revenue was
up 11% with growth driven by marketplaces
and memberships. We now have 168 million
free consumer members globally.
a
We delivered strong Benchmark EBIT
growth, up 9% at both constant and actual
exchange rates.
a
The underlying margin improvement was at
the top end of our expectations, Benchmark
EBIT margin for ongoing activities was
27.4%, compared to 26.2% in FY22 and a
re-presented prior-year comparative
margin of 26.6%. This represented 30 basis
points underlying uplift, and a 50 basis
points uplift from foreign exchange
translation.
a
We delivered strong growth in Benchmark
earnings per share, which increased by 9%.
Basic EPS was USc84.2 (2022: USc127.5),
predominantly due to a goodwill impairment
in EMEA of US$179m due to higher interest
rates and macroeconomic weakness in our
European markets, and an increase to the
fair value of contingent consideration.
a
We had another year of strong cash flow
conversion. We converted 98% Benchmark
EBIT into Benchmark operating cash flow.
Benchmark operating cash flow was
US$1.8bn.
a
Return on capital employed (ROCE) was
16.5%, up 80 basis points on the prior year.
a
We ended the year with Net debt to
Benchmark EBITDA at 1.8x, compared to our
target range of 2.0-2.5x and we have no debt
refinancing due until September 2024.
Around 90% of our current debt is at fixed
interest rates for the next two years.
Experian plc
Strategic report
10
Other financial developments
Benchmark profit before tax (PBT) was
US$1,670m, up 9% at actual exchange rates,
after a net interest expense of US$124m (2022:
US$110m). Benchmark net finance expense
increased modestly despite the large increase
in market rates thanks to our forward rate
fixing programme meaning the average
interest rate on our Net debt was broadly
stable at around 3%. For FY24, we expect net
interest expense to be in the range of
US$125-130m.
The Benchmark tax rate was 26.0% (2022:
25.7%). For FY24, we expect a rate of around
26-27%, taking into account expected profit
mix for the year and an increase in the UK
corporate tax rate.
Our Benchmark EPS was USc135.1, an increase
of 9% at both constant and actual exchange
rates. For FY24, we expect weighted average
number of ordinary shares (WANOS) to be
c.914m.
Foreign exchange translation was neutral to
Benchmark EPS. For FY24, we expect a foreign
exchange translation effect of c.0% to +1%
impact on revenue and Benchmark EBIT,
assuming recent foreign exchange rates prevail.
Non-benchmark items:
a
Statutory PBT was US$1,174m, down
US$273m, as a result of increased
non-benchmark costs.
a
Macroeconomic conditions have contributed
to a non-cash impairment of goodwill of
US$179m, partially offset by a gain on
financing fair value remeasurements of
US$51m.
a
We have incurred a charge of US$45m for
increased contingent consideration due to
over-performance on prior acquisitions.
a
We have also continued to execute on our
plans to streamline our geographic and
operational footprint in EMEA/Asia Pacific
and associated global functions. In
connection with this programme in FY23,
we have provided for costs of US$69m,
including US$53m of restructuring and
US$16m of onerous global support costs
for exited businesses.
Capital allocation and liquidity
a
Cash generation was strong with 98%
conversion of Benchmark EBIT into
Benchmark operating cash flow (2022:
109%). Benchmark operating cash flow
was US$1.8bn, down (3)% at actual
exchange rates.
a
We continued to invest in data, technology
and new products through capital
expenditure, which represented 9% of total
revenue. We plan to sustain strong levels of
investment to support our growth, and for
FY24 we expect capital expenditure to
represent c.9% of total revenue.
a
We invested US$480m in acquisitions and
US$15m in investments in support of our
strategic initiatives. Acquisitions were
principally in income verification and
employee services, and included CIC Plus,
Inc. (CIC Plus) in North America, and Pay
Dashboard Ltd and the Work Report in UK&I.
a
We are announcing a second interim
dividend of USc37.75 per share, up 6%. This
will be paid on 21 July 2023 to shareholders
on the register at the close of business on
23 June 2023, taking our full-year dividend
to USc54.75 per share, up 6%.
a
We have completed our FY23 share
repurchase programme for a net cash
consideration of US$175m, which mainly
offsets deliveries under employee share
plans. We are also announcing that we will
commence a net US$150m share
repurchase programme in FY24, which
will again offset deliveries under employee
share plans.
a
Our bonds, including derivatives, totalled
US$3.9bn as at 31 March 2023 and had an
average remaining tenor of five years.
Undrawn committed bank borrowing
facilities were US$2.4bn as at 31 March
2023 (2022: US$2.6bn).
a
At 31 March 2023, Net debt to Benchmark
EBITDA was 1.8x, compared to our target
leverage range of 2.0-2.5x. We have no
refinancing commitments until September
2024. Around 90% of our current debt is at
fixed interest rates for the next two years
and 67% fixed for at least four years.
Environmental, Social and
Governance (ESG)
The current cost pressures faced by
consumers makes gaining access to fair,
affordable credit all the more important.
We are focused on our mission and purpose
to encourage broader financial inclusion and
to help people to take control of their finances.
This is a defining ethos of our business, and
we take great pride in it, doing what we can
to make a positive difference to society.
a
Around 13 million consumers have now
connected to Experian Boost, empowering
millions to improve their credit scores and
improve their financial lives. Experian Go
launched in the USA in January 2022,
enabling ‘credit invisibles’ to establish
their financial identity in minutes, and
over 130,000 US consumers have since
connected to the platform. We were
delighted that Experian Go was recognised
as a 2023 BIG Innovation Award winner.
a
Since 2013, our social innovation products,
specifically developed to deliver societal
benefits and improve financial health, have
reached 106 million people, exceeding our
target of 100 million people two years early.
a
Our United for Financial Health programme
to improve financial education among
disadvantaged communities has now
connected with 113 million people since
launch, exceeding our target of 100 million
people a year early.
a
We pride ourselves on our ‘people first’
culture. This year we were listed in Fortune’s
2023 ‘100 Best Companies to Work For’ for
the fourth consecutive year, 95% of our
employees agreed that Experian is
committed to creating a diverse, equitable
and inclusive culture, and we were ranked
21st in Equileap’s ‘Top 100 Globally for
Gender Equality’ for 2023.
a
Following recent appointments to our Board,
it is now 45% women and includes two
ethnically diverse Board members. Our
Board meets the recommendations of the
FTSE Women Leaders Review on gender
diversity and the Parker Review on ethnic
diversity.
a
As part of our journey to be carbon neutral
by 2030 in our own operations, we have
reduced our Scope 1 and 2 emissions by
38% this year, reaching a 65% reduction
since our 2019 base year. 62% of our
electricity is now renewable. In order to
reduce our Scope 3 emissions, we are
continuing to engage with our suppliers and
have improved our emissions calculations
methodology. We are pleased to be
recognised again in the Financial Times’
Europe Climate Leaders 2023 for our
success in reducing our carbon emissions.
Our commitment to help tackle climate
change is also reflected in our CDP rating of
‘A-’, placing us in the Leadership category
and among the top 24% of professional
services companies. We are working to
complete our Net Zero Transition Plan in line
with the UK’s Transition Plan Taskforce draft
Disclosure Framework.
Outlook
For the year ahead, we
anticipate another year of
growth due to the breadth and
the resilience of our portfolio,
and significant structural growth
opportunities. Despite the
uncertain economic climate,
we expect to deliver organic
revenue growth in the range of
4% to 6% and modest margin
accretion, all at constant
exchange rates and on an
ongoing basis.
11
Experian plc
Annual Report 2023
Strategic report
Chief Executive’s review
continued
Latin America
O
rganic revenue growth
%
6
13
9
17
16
2023
2022
2021
2020
2019
North America
Growth in North America was good. Revenue
was US$4,432m, with total revenue growth at
constant currency of 8% and organic revenue
growth of 7%. Acquisition growth included CIC
Plus, in employment services, and Gabi in
Consumer Services.
In B2B, organic revenue growth was 5% driven
by innovation, a diversified portfolio, and
competitive outperformance.
Consumer and Business Information Services
delivered low-single digit organic growth
overall, and high-single digit organic growth
when mortgage is excluded. This was despite
mixed external conditions in the USA which
caused some of our lending clients to adopt a
more cautious stance by tightening their credit
criteria. Our growth was due to strong new
business outperformance in the year with our
differentiated data assets, real-time data
delivery capability, analytics and Experian
Ascend major contributory factors. Ascend
continues on a positive trajectory and we
continue to expand the range of products on
the platform. Ascend Ops is the latest
innovation and will sustain momentum.
Experian PowerCurve also had a good year,
particularly in collections and analytics. We
also made significant progress in Employer
and Verification Services, adding to our data
count, now at 47 million US individuals, and
securing new clients across verification
services and for Experian Verify.
We saw growth in automotive, where we have
a range of products which combine Experian’s
credit and marketing capabilities, as the
industry seeks to stimulate car purchases and
auto lenders adjust to recessionary risk
models. In Targeting, which had a very strong
year, we are successfully delivering on our
strategy to reposition towards digital
marketing. We are serving higher growth
segments of the market having expanded our
position in digital identity and data connectivity
and enablement. We also performed well in
Health, despite a strong prior year comparable.
Latin America delivered strongly, with revenue
of US$947m representing organic revenue
growth of 16% and total revenue growth at
constant currency of 18%. Acquisitions
contributing to our performance included
Sinacofi, our new bureau in Chile, and
PagueVeloz in Consumer Services in Brazil.
In B2B, organic revenue growth was 13%.
Credit markets in Brazil continue to undergo
significant change brought about by regulatory
reforms, creating new opportunities for our
business all driven by the expansion of the
market. We have established over 200 sources
of positive data, covering 82% of the credit
active population, and are seeing strong
demand for positive data solutions, including
improved scores, more predictive analytics
and sophisticated software platforms. Ascend
is progressing well, with adoption by existing
and new clients. PowerCurve performed well
and we are growing strongly in fraud
prevention. We are adding and growing
relationships with small and medium
enterprises, and our agribusiness vertical,
which is still at an early stage of its
development, grew very strongly.
Spanish Latin America delivered strong
growth, reflecting bureau volume strength,
uptake of new richer datasets and advanced
analytics. We are also rolling out the Ascend
platform and have benefitted from good
demand for our fraud and identity
management products.
In Consumer Services, organic revenue growth
was 32%. We continue to build our brand in
Brazil with the ambition of becoming one of
the most recognised financial services brands.
We added 10 million consumer memberships
year-on-year to take our total free
membership base to 81 million. Our app now
ranks at number two of Brazil’s top financial
services apps (per data.ai). We are enhancing
our ecosystem of consumer offers to
encourage engagement and enhance the value
of our services to our consumer members.
We were delighted to be recognised as Best in
KLAS, a US Health industry award, for our
claims and contract management solutions.
Consumer Services delivered organic revenue
growth of 11%. We are deepening and growing
our member relationships by helping
consumers to manage their financial health.
This year we introduced a range of new
features, including new ways to boost your
credit score using rental information and bill
negotiation to help with savings. We are proud
that Experian is now a top 15 US finance app
(in the Apple App Store) with a 4.8 star rating.
Our free membership base has grown to 62
million, up by ten million year-on-year. We now
provide offers across several active verticals,
which means more ways for consumers to
engage with Experian in order to manage their
finances. Marketplace delivered another
strong year of growth, driven by cards and
loans expansion, even as credit market
conditions got somewhat tougher and lenders
reduced credit market supply. New services
for lenders have been an important factor in
helping us to outperform in the current
environment: Experian Activate enables
lenders to target their offers more precisely
and to help them secure higher conversion
rates. We also benefit from the growing
diversity of our business model. The
contribution from our insurance vertical is
growing rapidly, while premium membership
and partner solutions also contributed
positively.
Benchmark EBIT rose 6% to US$1,467m.
The Benchmark EBIT margin reduced 40 basis
points to 33.1%. Margins reflected the mix
of growth, investments in our verification
services and our insurance marketplace and
our innovations across our scaling verticals.
O
rganic revenue growth
%
10
11
7
13
7
2023
2022
2021
2020
2019
Regional highlights for the year ended 31 March 2023
Expanding into Verification and
Employer Services
Our expansion into Verification and
Employer Services is progressing well.
North America has achieved revenues of
over US$160m and a record count of 47
million, and we have established access
to records representing 77% of the UK
PAYE workforce and have nascent
positions in other markets.
Read about Experian
Verify on page 77
Experian plc
Strategic report
12
UK and Ireland
O
rganic revenue growth
%
4
(2)
(6)
11
5
2023
2022
2021
2020
2019
EMEA/Asia Pacific
O
rganic revenue growth
%
14
(3)
(14)
3
3
2023
2022
2021
2020
2019
The UK and Ireland delivered a good
performance overall. Revenue was US$784m,
with both total and organic revenue growth at
constant exchange rates of 5%.
In B2B, organic revenue was up 7%, a great
performance in a year that included periods
of extreme economic instability. Our market
position in the UK has strengthened, driven
by investments we have made to extend data
superiority and to add new product capability.
As a result, we secured new business wins
across a broad range of industry segments
including financial services, energy, utilities
and telecommunications. While lenders have
tightened credit criteria, affordability and
eligibility products performed well, and
we are helping our clients to cope with the
cost-of-living crisis, as well as to meet new
regulatory obligations under the Financial
Conduct Authority’s new Consumer Duty.
Fraud and identity management also
performed well, with strong win rates and
new business bookings, while Targeting also
contributed positively. While we expect
economic conditions in the UK to remain
fairly soft, we are confident we will emerge
strongly when the economic cycle turns.
In EMEA/Asia Pacific, revenue from ongoing
activities was US$424m, with both total and
organic growth at constant exchange rates
of 3%.
The transformation of our EMEA/Asia Pacific
operations is progressing well. We have
reduced costs and are exiting from non-core
activities. We are focused on realising our full
potential in markets where we have scale
by utilising our extensive data assets and
leveraging Experian global platforms.
We made progress this year despite
macroeconomic headwinds in some markets.
a
Australia and New Zealand – made good
progress positioning Ascend and Experian
One, with positive contributions in data.
a
DACH (Germany, Austria and Switzerland)
– delivered a weaker performance due to
economic headwinds and lower volumes.
a
India – delivered strongly with a strong
contribution from our bureau.
a
Italy – performed strongly due to new
product innovations and higher bureau
volumes from new business.
a
South Africa – delivered well, with good
progress in decisioning, despite
macroeconomic headwinds.
a
Spain – performed well despite a strong
prior-year comparative, with strong growth
from Consumer Information volumes and
Open Banking.
Our actions have led to an improved
Benchmark EBIT trajectory, which for ongoing
activities was US$14m, up 8%. The Benchmark
EBIT margin for ongoing activities improved to
3.3% from 2.9%.
In the full year ended 31 March 2023, the
non-core markets accounted for revenue of
US$32m and Benchmark EBIT of US$(8)m. Due
to higher interest rates and macroeconomic
weakness in our European markets we have
impaired goodwill in EMEA by US$179m.
Revenue growth reflected further progress in
our debt resolution service, Limpa Nome, as
we added new partners and settled more
debts on the platform, plus increased usage of
our credit marketplace and premium services.
We are also developing services for
consumers more widely across Latin America
and our membership count for Spanish Latin
America has reached 13 million.
Benchmark EBIT in Latin America was
US$294m, up 30% at constant exchange rates.
The Benchmark EBIT margin from ongoing
activities at actual exchange rates was 31.0%,
up by 280 basis points. While we continue to
invest in developing new market opportunities,
the margin uplift reflects revenue growth
drop-through and improving margin in
Consumer Services as the business scales.
Our confidence is underpinned by a compelling
pipeline of new product introductions, which
include new Ascend modules, products to
support fairness in lending and new
capabilities to conduct income and
employment verification.
In Consumer Services, organic revenue was
down (4)%. While consumer demand for credit
held up relatively well, volumes in our credit
marketplace were affected in the second half
of the year by the reduction in credit supply.
Our premium subscription services were also
affected negatively as we lapped a strong prior
year comparable. We are investing in new
capabilities to attract and retain members, and
introducing a new CreditLock feature this year.
We plan further new feature introductions in
the months to come. Free memberships were
12 million.
Benchmark EBIT from ongoing activities was
US$170m, up 1% at constant exchange rates.
The Benchmark EBIT margin from ongoing
activities was 21.7% (2022: 22.2%). The
reduction reflects start-up investment in our
income and employment verification initiative,
the commencement of the implementation
phase of our UK&I technology migration plan
and lower growth in Consumer Services.
Leveraging our global capabilities
We have an extensive roadmap of new
product introductions planned in the UK&I
in FY24 to leverage our global capabilities
and build on a strong year for B2B new
business performance in the region.
EMEA/Asia Pacific
transformation on track
The first phase of our transformation in
EMEA/Asia Pacific is on track with
improving profitability. In the second
phase, we are focused on improving
growth with stronger, new product
introductions.
13
Experian plc
Annual Report 2023
Strategic report
Our investment case
An attractive investment proposition
We address large market opportunities with our extensive datasets, innovative products and deep expertise.
We are successfully executing our strategy and investing in exciting new opportunities to fulfil our ambitions.
Our strong track record of delivery, growth prospects, business resilience, capital discipline and commitment
to our responsibilities combine to create an attractive investment proposition.
US$
6.6
bn
revenue
US$
627
m
capital investment
11+
industry sectors
>US$
1.2
bn
revenue from product
innovation
32
countries
131
patents pending
No.
1
or
2
revenue position in the USA,
Brazil and the UK
Market-leading,
global innovator
Our purpose-driven
growth strategy
We play a vital role in the financial ecosystem, enabling millions of
people and thousands of organisations to access financial services,
connecting them in a safe and secure way. We have a diverse
portfolio of businesses across different sectors and regions, with
strong positions in growing markets. We create significant scale
and synergies across our operations from combining data sources,
integrating analytics and using technology to create innovative,
differentiated products. Our platforms and products make it
easier, cheaper and faster for consumers and clients to access
information, solve their problems and achieve their goals.
Improving financial health is at the heart of our strategy and
supports our long-term success. It underpins our approach and,
together with our five Strategic Focus Areas, helps us focus our
business. We identify investment opportunities to build strong
positions in fast-growing markets, supported by the increasing use
of data and drive for increasing digitisation. Diversifying into new
markets helps us expand our business and increases our resilience.
To better serve consumers and clients, we build innovative, scalable
products, combining capabilities from across our business. We see
a significant opportunity to do even more to help consumers with
their financial health, which will strengthen our entire business.
In order to support our growth we look to invest in businesses
that could accelerate our entry into a market or product area
and will drive material returns for our business.
Learn more in the Our strategy
section, pages 28 – 35
Experian plc
Strategic report
14
106
m
people reached via
Experian’s Social
Innovation programme
1.5
bn
consumer and
7
%
Organic revenue growth
Supporting UN
Sustainable
Development Goals
1.4, 8.10, 9.3
82
%
employee engagement
98
%
Cash flow conversion
US$
17.6
m
community investment
Carbon
neutral
in our own operations
by 2030
201
m
business credit history
records
168
m
free members
4.4
Glassdoor rating
1.8
X
Net debt to Benchmark
EBITDA
A sustainable focus and
strong commitment to ESG
Strong foundations support
our growth strategy
Proven track record and
strong financial position
We fundamentally believe that we can help to deliver financial
power to all. We live this through our purpose, which is to create
a better tomorrow for people, for businesses and for our
communities.
We place a strong emphasis on ESG and our wider responsibilities
to society. We aim to treat data with respect, create innovative
products which promote financial wellbeing, invest in social
innovation programmes and reduce our carbon footprint.
Our data assets are extensive. Unrivalled in their scale, quality
and integrity, when combined with sophisticated analytics they
are one of the most powerful and accurate sources available for
precise decision-making. We continually invest to extend our data
assets to enhance their breadth, depth and quality. We have created
a unique free consumer finance platform that is supporting millions
of people in taking control of their finances and saving money.
We promote a ‘people first’ culture. We are proud of how our people
work together, as evidenced by receiving Great Place To Work in
22 countries, a Glassdoor rating of 4.4 and by our progress in
diversity, equity and inclusion.
We invest in technology to deliver great products, make us more
productive and to keep our operating environment secure.
Investment in cloud-based technologies and machine learning
are foundational to our best-in-class propositions. Technology
enhances our own processes and productivity. It is also critical
to how we ingest, store and secure data.
Many of our products and services are integral to our clients’
operating processes. Because of this, we have highly recurring
revenue. Our growth strategy is aimed at delivering sustainable
financial returns, including organic revenue growth and at least
stable margins. The counter-cyclical nature of portions of our
product portfolio, as well as our portfolio diversity, means we have
delivered organic revenue growth every year since becoming a
listed company in 2006. Our cash flow is consistently strong, and
we have a proven record of converting operating profit to cash.
This allows us to prioritise investment, both organically and
by pursuing focused acquisition opportunities, while balancing
returns to shareholders. Our balance sheet is strong, and we aim
to operate within our leverage policy target range of Net debt to
Benchmark EBITDA of 2.0–2.5x.
Learn more in Sustainable business
See pages 36 – 63
See note 7 to the Group financial
statements for definitions of
non-GAAP measures
15
Experian plc
Annual Report 2023
Strategic report
Stakeholder engagement
Consumers need
a
Access to seamless services that help make
their financial lives easier, simpler and
quicker to navigate
a
High-quality and accurate data, to make
more informed decisions
a
A high level of data security and privacy
assurance
a
Protection from fraud and identity theft
How we add value
We put people in control of their financial
wellbeing. We help them to access many
financial services such as obtaining credit,
saving money and paying bills. Because
consumer data is at the core of our business,
consumers need a company they can trust
with that data and who will be their champion.
Not only do we serve consumers directly, but
our clients, whether they are businesses or
other organisations, serve consumers as their
end customer. This is why consumers are at
the heart of all we do. For information on how
we add value for consumers please see the
Our business model section.
Through our purpose, business model and strategic execution we aim to have a positive impact on all our
stakeholders. We recognise their needs and priorities, regularly engage with them and work to establish deeper
relationships. Our stakeholders are crucial to the success of our company and our long-term profitability.
Building strong relationships with
our stakeholders is key to our success
168
m
free members
8.2
m
conversations with
consumers
538
k
fraud victims
supported
US$
8.9
bn
debt renegotiated
Engaging with our key stakeholders
We have a diverse range of stakeholders; this
includes seven key stakeholder groups:
a
Consumers
a
Our clients
a
Our communities
a
Our people
a
Our suppliers
a
Governments
a
Our shareholders and bondholders
We aim to treat all stakeholders fairly, ensuring
we engage in a regular programme of dialogue.
Each group has its own distinct, but sometimes
overlapping, needs. We engage frequently to
better understand their needs and priorities
through a continual process, which helps to
build understanding. We work with our
stakeholders to solve their problems, however
big or small, by finding new data sources,
developing new propositions, addressing their
needs and improving our processes.
By delivering to our clients and consumers,
working side-by-side with suppliers, meeting
regulations, keeping our commitment to our
people, supporting communities and creating
financial returns for our shareholders, our
stakeholders in turn support us and help our
company to continue to grow in a strong,
sustainable way.
We engage with them through
a
Day-to-day interactions on our free apps
and platforms provide financial education,
savings, payment services, debt
renegotiation tools and free Experian credit
reports online, as well as other products
and services
a
Contact centres which address customer
concerns on a range of issues, from access
to credit, to amending data on their credit
file, to helping to support people who are
victims of identity theft
a
Outreach through our consumer education
programmes, Experian Education
Ambassadors, consumer experience
programmes and consumer councils
a
Marketing campaigns and media relations
activities
a
Social media channels, such as AskExperian
blog, #CreditChat campaign, CreditChatLive
events and Experian News, as well as
working with social influencers
a
To address data accuracy on credit files, we
have processes for consumers to review
their data, raise a query and have
corrections made if needed
a
To maintain the highest standards and
integrity in data security and privacy we
adopt rigorous policies, processes and due
diligence right across Experian. We consider
that data security is every employee's
responsibility
unbanked
credit visibility
improved credit scores
fairer, faster credit offers
better financial management
credit active
credit savvy
underbanked
We help the
Enabling
We enable financial inclusion, build financial health and confidence
Consumers
Experian plc
Strategic report
16
Our clients need
a
To enhance the services they provide to their
customers – typically faster, frictionless and
more personalised digital interactions
a
To identify their customers and prevent
fraudulent transactions
a
High-quality and accurate data on which to
base their decisions
a
To manage and reduce their costs
a
To meet their own compliance and
regulatory requirements
a
Data security and privacy
Our communities need
a
Business success, employment and job
creation
a
Access to public services
a
Long-term asset creation
a
Inclusion in mainstream financial services
and products
a
A healthy environment to live in
How we add value
We work hard to get to know our clients. We
want to delight them, so we stay in tune with
the issues and concerns they have and help
them solve their problems. Whether that is so
they can gain faster, smarter insights from
customer data, protect against fraud or deliver
more efficient, more personalised services to
their customers using our sophisticated
solutions. For more information on how we
add value for our clients please see the Our
business model section.
How we add value
We are helping people, across many
communities, access credit and other financial
services that they can use to take control of
their financial circumstances and improve
their lives. Our businesses support local
economies in the areas in which we operate
through employment and paying taxes. By
helping businesses prosper, we enhance their
potential as local employers.
4.3
bn
credit decisions
facilitated
113
m
people connected
through UFH since
launch in FY21
7,860
technologists and
product developers
at Experian
US$
17.6
m
community investment
47,000
hours volunteering
1.5
bn
consumer credit
records
201
m
business credit
records
152
k
clients globally
106
m
people reached
through Social
Innovation projects
We engage with them through
a
Day-to-day interactions with Sales, Product
and Support teams
a
Ongoing client relationship and Net
Promoter Score surveys, customer loyalty
monitoring
a
Responding to client requests for
information
a
Regular opportunities, such as webinars,
advisory boards and conferences, for clients
to explore how data and technology can help
them address market trends
a
Customer-experience programmes to
monitor client expectations
a
Collaboration with our data scientists at our
three DataLabs in Costa Mesa, London and
São Paulo to solve key challenges and
create innovative solutions
We engage with them through
a
Our core products such as Experian Boost
and Experian Go and social innovation
products (e.g. Limpa Nome) that help
improve financial lives
a
Working with NGO partners and our United
for Financial Health programme (UFH)
a
Direct community investment, charity
partnerships and sponsorship, with a strong
focus on initiatives that support financial
education and management
a
Employee volunteering and technical
support for charities, including gifts in kind
and pro bono work
a
Advice and support
a
Campaigns to raise awareness of topics
relevant to communities
Our clients
Our communities
17
Experian plc
Annual Report 2023
Strategic report
Stakeholder engagement
continued
Our employees need
a
To feel valued for their contribution
a
To feel supported
a
To feel satisfied with their work environment
a
To feel they make a difference to society
a
To contribute to our engaging, positive,
empowering culture
a
Training and learning
a
Career progression
a
Job security
Our suppliers need
a
Long-term, collaborative, trusted
relationships
a
Business opportunities
a
To mitigate market and financial risks
a
To meet regulatory requirements and
our ESG expectations
How we add value
We are committed to our people. We support a
positive, collaborative, diverse, equitable and
inclusive culture and do all we can to make
Experian a great place to work, where every
person can bring their whole self to work.
We listen to our people's views and value their
feedback. We celebrate great performance and
offer employees support to learn new skills
and progress their careers, giving them a
sense of purpose – an integral part of our
organisational culture that has a positive
impact globally.
How we add value
Closer relationships with our suppliers,
enabled through partnerships and fairness,
help us to uncover and realise new value,
increase savings and reduce costs and risk
of failure, as well as ensuring that we meet
our compliance obligations. Many of our data
contributors are also our clients. They often
supply us with data through a give-to-get
model. Our ability to combine, clean, sort
and aggregate data from thousands of data
contributors creates a more complete picture
of consumer or business interactions across
markets.
22,000
employees
25
key suppliers in our
dedicated SRM
82
%
employee
engagement
6,700
suppliers in our three
largest markets
4.4
Glassdoor rating
We engage with them through
a
A ‘people first’ culture which helps us to
attract, retain and develop our highly
talented people
a
Internal communications, including our
enterprise-wide communication platform,
Horizon
a
Regular dialogue and performance
discussions with managers
a
Regular people surveys (Pulse and Great
Place to Work (GPTW)), surveys for new
joiners and leavers
a
Board and executive meetings, and
quarterly global webinars hosted by our
CEO, CFO and COO
a
Regular townhall meetings with senior
management and other engagement events
a
Employee Resource Groups and other
networking opportunities
a
Feedback via the online feedback.me tool
a
Employee assistance helpline
a
Whistleblowing hotline
We engage with them through
a
A formal procurement process for supplier
selection
a
A specific supplier-facing website to help
them understand our expectations and
ethical requirements
a
Our Supplier Relationship Management (SRM)
programme for key suppliers that helps
ensure streamlined processes, performance,
segmentation and qualification
a
Third-Party Supplier Risk Assessment
process, that includes due diligence in critical
areas such as data security and compliance
a
Supplier assessment and training focused
on reducing the risk of Modern Slavery
among key suppliers
a
The Carbon Disclosure Project (CDP) to
understand their contribution to our
Scope 3 emissions
Our people
Our suppliers
Experian plc
Strategic report
18
Governments need to
a
Generate prosperity
a
Manage economic cycles
a
Support their stakeholders’ financial wellbeing
a
Create regulations and ensure compliance
a
Manage issues that affect consumers and
businesses
a
Mitigate impacts of and, where possible,
reverse, climate change
They need
a
To understand Experian’s strategic direction,
financial performance, and the sustainability
of the business
a
To analyse structural market trends
a
To generate sustainable investment returns
through share price appreciation, dividend
payments, bond interest and share
repurchases
a
To understand management and incentive
structures
a
To ensure they are investing in businesses
that are committed to environmental
progress and societal benefit, and which
have strong governance
How we add value
Operating in a complex and evolving regulatory
environment globally, we aim to maintain a
positive and proactive engagement strategy
with governmental institutions and
policy-makers in all our regions. This is
because we enable the transparent flow of
data that is essential to the functioning of
modern economies and the financial
ecosystem. High-quality data coupled with
advanced analytics reduces risk to lenders,
improves processes and helps reduce fraud.
It enables people to make informed decisions
about their finances. The economy benefits
with improved access to credit, improved
market competition, increased diversification
of financial products available and reduced
cost of credit.
How we add value
We aim to create value for current and
potential owners of Experian’s shares and
bonds through organic and inorganic
investments that grow our position in our
chosen markets. We balance this investment
with shareholder returns, dividend payments
and share repurchase programmes when
appropriate – all while ensuring we meet
our wider sustainability commitments.
This creates long-term, sustainable value
for our shareholders and bondholders.
32
countries
7
%
Organic revenue
growth
65
%
reduction in scope 1 and 2
carbon emissions since 2019
19
consumer
and
16.5
%
Return on capital
employed
USc
135.1
Benchmark EPS
15
business information
bureaux
We engage with them through
a
Constructive relationships with
policy-makers, including regular interaction
with members of senior management
a
Events where we communicate the role we
play in supporting an innovative, regulated
data industry
a
Responding to public consultations on
issues relevant to our business, and liaising
with various organisations to address
societal challenges
a
Participating in multi-stakeholder
engagement for policy consultation;
providing policy-makers with a better
understanding of our industry, data
processing and innovative data use
a
Monitoring regulations, and putting in place
policies and processes to ensure
compliance
We engage with them through
a
A dedicated investor relations programme
a
Quarterly financial updates, Annual Report,
Diversity, Equity and Inclusion Report and
Improving Financial Health Report, Tax
Report – in which we inform analysts,
investors and other interested parties about
Experian’s financial and strategic progress
a
Face-to-face and virtual meetings,
roadshows, conferences and teach-in
sessions specific to our business, strategy
and ESG matters
a
We engage with bondholders to answer any
queries when they arise and organise focused
update meetings prior to bond issuance
a
Regular investor surveys and feedback –
shared with management and the Board to
ensure our shareholders' views are well
understood
a
The Chair of the Board meets our largest
shareholders to discuss developments in
strategy, ESG and other material issues
a
During our Annual General Meeting
shareholders are able to meet and put
questions to our senior management team
and Board of directors
a
A plc website on which investors can access
a wide array of information about Experian
USc
54.75
Full-year dividend per share
Governments
Our shareholders and bondholders
19
Experian plc
Annual Report 2023
Strategic report
Key performance indicators
A strong performance
We have achieved a strong performance, showcasing the strength of our strategy and the resilience of our business
model. We measure our progress through a range of key performance indicators and use the results to enhance our
decision-making throughout the year.
Why is this important?
It is a measure of our ability to provide innovative
propositions and services for clients and consumers, and to extend these
to new industries and across many regions.
Aim:
To consistently achieve mid to high single-digit organic revenue
growth.
Analysis:
Organic revenue grew 7%. The main contributors to growth
were Brazil, progress in Consumer Services, a solid performance in UK
and Ireland B2B and good contributions from vertical expansion.
More detail:
In the Chief Executive's review.
See page 125 – Revenue performance is linked to directors’ remuneration
For a reconciliation of revenue from ongoing activities, including disclosure of organic and acquisition
revenue, from the year 31 March 2022 to 31 March 2023 see Note 10(a)(ii) to the Group financial
statements.
Why is this important?
It measures how well we turn our revenue into
profits, which allows us to reinvest for future growth and to provide
returns for shareholders.
Aim:
To operate our business efficiently and cost effectively with stable
EBIT margins.
Analysis:
We continue to invest in new data sources, product innovation,
technology and top talent. Those are the foundational elements of our
business. This year we achieved Benchmark EBIT from ongoing activities
of US$1,802m, up 9% at both constant and actual exchange rates.
Benchmark EBIT margin was 27.4%, up 30 basis points before the impact
of foreign exchange rates, and up 80 basis points overall.
See page 125 – Benchmark EBIT is a directors' remuneration measure
1
From ongoing activities.
2
Results for FY22 are re-presented for the reclassification to exited business activities of certain
B2B businesses.
Why is this important?
It measures how effectively we have deployed
our resources and how efficiently we apply our capital.
Aim:
To generate good returns on the investments we make and create
long-term value for shareholders.
Analysis:
This year, ROCE was 16.5%, up 80 basis points on the prior year,
reflecting growth and our continued focus on operating efficiency.
See page 125 – Adjusted ROCE is a directors’ remuneration measure
Why is this important?
EPS measures our success at generating
surpluses and value for our shareholders.
Aim:
To achieve earnings growth for shareholders while balancing
reinvestment to secure future growth opportunities.
Analysis:
Benchmark EBIT from ongoing activities was up 9% at constant
exchange rates, helped by the strength of our organic revenue growth
performance and cost discipline. Our Benchmark net finance costs
increased US$14m to US$124m, and the Benchmark tax rate was up
30 basis points to 26.0%. With weighted average numbers of shares at
914m, this resulted in Benchmark earnings per share of 135.1 US cents.
This was up 9% on the prior year at both actual and constant
exchange rates.
See page 125 – Benchmark EPS growth is linked to directors’ remuneration
Organic revenue growth
Return on capital employed (ROCE)
Benchmark EBIT and Benchmark EBIT margin
1
Benchmark earnings per share (EPS)
7
%
16.5
%
USc
135.1
27.4
%
US$
1,802
m
%
2023
7
2022
12
2021
4
2020
8
2019
9
%
2023
27.4
2022
²
26.6
2021
25.8
2020
26.9
2019
26.9
US$m
1,802
1,653
1,379
1,386
1,306
%
2023
16.5
2022
15.7
2021
14.9
2020
16.1
2019
15.9
Usc
2023
135.1
2022
124.5
2021
103.1
2020
103.0
2019
98.0
See note 7 to the Group financial statements for definitions of these non-GAAP measures: organic revenue growth, Benchmark EBIT, Benchmark EBIT margin, ROCE, Benchmark earnings per share,
and Benchmark operating cash flow and cash flow conversion.
Experian plc
Strategic report
20
Why is this important?
Benchmark operating cash flow is the cash
generated by the business. It gives us the capacity to operate and
reinvest, and fund acquisitions and shareholder payments. The efficiency
with which we convert profits into cash flow is measured by cash flow
conversion.
Aim:
To convert at least 90% of Benchmark EBIT into Benchmark
operating cash flow.
Analysis:
Cash flow performance was strong this year with Benchmark
operating cash flow of US$1,753m, down US$47m on last year. The slight
decrease is due to exceptional conversion in the prior year and a higher
investment in growth initiatives.
See page 125 – Cumulative Benchmark operating cash flow is a directors’
remuneration measure
See note 41(g) for reconciliation of Cash generated from operations to Benchmark operating
cash flow.
Why is this important?
Our people make us great. Engaged and
motivated people help us develop innovative propositions, find new
opportunities, and grow.
Aim:
To ensure Experian is a great place to work and that we can attract
and retain the best people.
Analysis:
For our second global Great Place to Work survey, this year we
achieved an engagement score of 82% (2022: 78%).
a
88% of our employees said they are proud to tell people they work at
Experian, a testament to our commitment to creating an inclusive and
welcoming workplace.
a
We were accredited as a Great Place to Work in 22 countries.
See the Inspiring and supporting our people section on pages 51 to 53 for further
information on how we've been looking after and listening to our people this year
Year
2023
2022
(restated)
2
2022
2021
2020
2019
Carbon intensity – total emissions per US$1m revenue (tonnes CO₂e)
3
28.4
31.2
87.4
87.6
100.1
107.9
Scope 1 & 2 market-based emissions (000s tonnes CO₂e)
3
10.1
16.4
16.4
16.5
25.1
29.2
Total Scope 3 emissions (000s tonnes CO₂e)
3
178.1
179.8
532.9
453.9
493.4
495.3
Why is this important?
It measures the carbon emissions we generate,
as we have a responsibility as a business to reduce our carbon footprint
and respond to the climate change emergency.
Aim:
To be carbon neutral in our own operations by 2030
1
.
Analysis:
This year, our total Scope 1 and 2 emissions have decreased by
38%. We have achieved this by increasing the use of renewable electricity,
improving our energy efficiency, embracing flexible working to reduce
building occupancy, and consolidation and reduction of office space.
Since 2019, we have reduced our total Scope 1 and 2 emissions by 65%.
This means we are currently outperforming and well on track to meet
our science-based target to reduce these emissions by 50% by 2030.
Our Scope 3 emissions have decreased by 1% in 2023 versus a restated
2022
2
. We engage with suppliers to encourage them to reduce their
emissions and are switching to suppliers who are actively reducing their
own emissions. We remain committed to delivering a 15% reduction in
these Scope 3 emissions by 2030.
Overall, we have reduced our carbon intensity by 9% since last year. Our
Scope 1 and 2 carbon intensity is down 41% since last year and down 74%
since 2019. We will continue to reduce our absolute carbon emissions
while the business continues to grow.
See the ‘Protecting the environment’ section on pages 56 to 62 for further
information on how we are taking action on climate change
1
All references in this Annual Report to ‘carbon neutral in our own operations by 2030’ includes
all Scope 1 and 2 emissions, as well as Scope 3 emissions from purchased goods and services,
business travel and fuel- and-energy-related activities (which represent 83% of our baseline
emissions in Scope 3) in line with the boundaries covered by our Scope 3 target approved by
the Science Based Targets initiative (SBTi). Once we have achieved our SBTi-approved targets,
we will invest in high-quality carbon offsetting projects to offset the remaining Scope 1, 2 and 3
emissions within the boundaries of our SBTi-approved targets to achieve carbon neutrality in
our own operations by 2030. Refer to pages 60 to 61 for further information.
2
In 2023 we have upgraded our Scope 3 methodology, from using a purely spend-based analysis
to also including actual supplier emissions data. We are therefore restating our 2022 Scope 3
figures using the same methodology, to provide comparable figures, resulting in restated figures
for purchased goods and services, upstream leased assets, capital goods, and investments.
For further information please refer to our 2023 Carbon Reporting Principles and Methodologies
document at www.experianplc.com/responsibility/data-and-assurance/.
3
CO₂e = CO₂ equivalent.
Benchmark operating cash flow and cash flow conversion
Carbon emissions
Employee engagement
82
%
98
%
US$
1,753
m
%
2023
98
2022
109
2021
106
2020
88
2019
97
US$m
1,753
1,800
1,476
1,214
1,270
21
Experian plc
Annual Report 2023
Strategic report
Our business model
Making a meaningful difference, building value
Our business is centred on our purpose: to create a better tomorrow. Every day, we help create opportunities for
people to improve their lives and for organisations to make faster, smarter decisions. Solving big problems and
little ones, helping to make a meaningful difference every day. We do this by transforming data into information,
information into insight through our advanced analytics and by helping people to act on the decisions they make
by using our software and platforms.
Technology and innovation
Great technology and innovation
underpin our success and support us in:
a
Managing our data
a
Developing advanced analytics and
decisioning tools, unrivalled in
breadth and depth of capability
a
Reducing the time and resources
needed to solve problems
a
Achieving operational excellence
a
Maintaining a secure operating
environment
People and culture
To help achieve our ambitions, we cultivate
an inclusive and welcoming workplace for
our 22,000 employees where we:
a
Nurture a people-first culture
a
Reward high performance
a
Encourage personal and
professional development
a
Celebrate innovation
a
Help ambition flourish
a
Are led by our purpose
The foundations of our business rely on data, technology, innovation, and our people
Expanding the breadth and depth of data coverage delivers us competitive advantage
and new ways to bring value to our clients and to consumers
Data
Our extensive data assets are the
foundation of our business. We are
constantly:
a
Adding data assets
a
Finding new datasets to complement
traditional data
a
Expanding the breadth and depth
of data coverage
a
Improving the quality, accuracy
and predictability of data
a
Broadening the application of data into
new and adjacent areas of use
Learn more in Sustainable business
See pages 36 – 62
Trended 3D
(attributes)
2001
Trended data
2016
Marketing
data
2020
Property
data
2020
Mobile
Carrier data
2021
Expanded
public
records
2021
Social
Security
2022
Rent
payment
insights
2011
Full-file
public
records
2020
Digital
Marketing
data
2021
Income and
Employer
data
2022
Screening
2021
Financial
Account
data
Extended
View
Banking
insights
Banking
insights
Experian
Verify
Cell Phone
Data
Tapad
Multiple
sources
Listing
Triggers
Consumer
View
Expanded
Rental
eCBSV*
Background
Data
The Consumers'
Bureau
Buy Now
Pay Later
Rent Bureau
Experian
Boost
Clarity
Short-term
Lending Data
FraudNet
1980s
Traditional
credit data
2014
Device and
Identity Fraud
data
2019
Consumer-
permissioned
data
2009
Rental data
2017
Alternative
Financial
Services
2022
Retail purchasing
behaviours
For example, our data coverage in North America has evolved and accelerated
over time, opening new market segments
* Electronic Consent-Based Verification Service
Experian plc
Strategic report
22
Business-to-Business
a
Access more data and sophisticated
analytics and software
a
Improve speed to value and ease of use
a
Use our technology and innovation to
compete and reduce costs
a
Maximise value of their own datasets
a
Navigate uncertainty and survive industry
transformation
a
Reduce fraud
a
Understand and manage risk effectively
through recession
a
Offer seamless consumer journeys
Consumer Services
a
Entrance to the financial system
a
Access to credit
a
Digital management of their financial life
and improved financial education
a
Fast, seamless interactions across many
areas of commerce and health (in USA)
a
The best available deals for mortgage,
utilities, insurance – saving time and
money
a
Use of their own data for their benefit i.e.
improved credit score
a
Reduce outstanding debts (Brazil)
a
Protection from identity theft
Explore
& learn
We assist consumer and
business interactions...
...for an expanding
set of verticals.
...more deeply and broadly than ever
before across the customer lifecycle...
Open/
set-up
account
Application
Manage
account
Loyalty
We provide essential services for consumers and businesses
The value we deliver to businesses and consumers continues to expand
Marketing &
engagement
Identity
& fraud
Credit/Risk
Customer/
Portfolio
Management
Payments/
Collections
Lending
FinTech
Health
Retail/eCommerce
Insurance
Automotive
Marketing/Advertising
Media/Technology
Public Sector
Protect my
identity
Educate and
enable me
Match me
Do it for me
Business-to-Business focus areas
Consumer Services focus areas
23
Experian plc
Annual Report 2023
Strategic report
How we organise our business and how it generates revenue
Business-to-Business
Data
Decisioning
52
%
of Group revenue – from ongoing activities
21
%
of Group revenue – from ongoing activities
What we do
We provide businesses with information to
establish and develop relationships with their
customers, grow their businesses over time
and to manage the risks associated with
making bad decisions, identifying fraudsters
or with extending credit. We build and manage
large and comprehensive databases. We
collect, sort, aggregate and transform data
from tens of thousands of sources, to provide
a range of data-driven services.
Key customers
Banks, automotive dealers, retailers and
telecommunication companies
Key datasets
1.5bn consumer credit history records and
201m business credit history records
Revenue model
a
Primarily transactional with some
contribution from licence fees
Market position
One of the leading providers of data in key
segments
Competitors include
Equifax, TransUnion, Dun & Bradstreet,
BoaVista, LiveRamp, Epsilon, Schufa, CRIF,
CTOS, Quod, LexisNexis
What we do
We draw on the depth and breadth of our
databases and third-party information,
including clients’ own data, to create
and develop analytics, predictive tools,
sophisticated software and platforms.
These help businesses and organisations
manage and automate large volumes of
decisions and processes more effectively
using the most advanced technology.
Our services help our clients improve the
consistency and quality of their business
decisions, in areas including credit risk,
fraud prevention, identity management,
customer service and engagement, account
processing, and account management.
Our industry specialists and data scientists
work with clients to help them find the best
solutions for their needs, providing advanced
data analysis and research and development.
Key customers
Financial services, retail, US healthcare,
telecommunications, utilities, insurance and
FinTech companies
Key propositions
Ascend Technology Platform, PowerCurve
decisioning, CrossCore fraud prevention
Revenue model
a
Software and system sales: consultancy
and implementation fees; recurring licence
fees; and transactional charges
a
Credit scores sold on a transactional,
volume-tiered basis
a
Analytics: a mix of consultancy and
professional fees, and transactional charges
Market position
One of the leading providers of business
solutions in key sectors (outside of the USA)
Competitors include
FICO, IBM, SAS, Change Healthcare, Provenir,
Verisk, Temenos
Our business model
continued
Analytics is
what makes
come
alive
data
1 Revenue from ongoing activities.
A
. North America
2,142
B
. Latin America
606
C
. UK and Ireland
391
D
. EMEA/Asia Pacific
301
T
otal
3,440
Data¹
(US$m)
A
B
C
D
A
. North America
837
B
. Latin America
176
C
. UK and Ireland
229
D
. EMEA/Asia Pacific
123
T
otal
1,365
Decisioning¹
(US$m)
A
B
C
D
Experian plc
Strategic report
24
Consumer Services
27
%
of Group revenue – from ongoing activities
What we do
We help millions of consumers take control of
their finances. We provide credit education,
identity monitoring and fraud prevention
services directly to consumers in the USA,
Brazil, UK, South Africa, Peru, Colombia and
India. This includes free access to their
Experian credit report and score, and useful
online educational tools. In the USA and UK,
we enable people to contribute their own data
to their file by adding, for example, rental, utility,
mobile payments and streaming services,
to help them improve their credit score. We
help people save money though marketplaces
where they can access credit, personal loans,
mortgages, automotive insurance and other
deals which are highly personalised to them.
In Brazil, our online recovery portal, Limpa
Nome, helps consumers meet their payment
obligations and the Serasa Digital Wallet helps
them manage their spending.
Key customers
Consumers, lenders and insurance providers
Key platform
Free platform with 168 million members
Revenue model
a
Monthly subscription and one-off
transaction fees
a
Referral fees for credit products
a
White-label partnerships
Primarily transactional with some contribution
from licence fees
Market position
One of the leading providers of consumer
services in key segments in Brazil, the UK
and USA
Competitors include
Credit Karma, Lending Tree, ClearScore,
Equifax, TransUnion, MoneySuperMarket,
revolut, monzo, Norton LifeLock, Credit Sesame
A
. North America
1,453
B
. Latin America
165
C
. UK and Ireland
164
T
otal
1,782
Consumer Services¹
(US$m)
A
B
C
25
Experian plc
Annual Report 2023
Strategic report
By understanding the different needs of our clients, we can truly transform their business activities. Not just at product level but
at the strategic level. However new or mature a business is, we work with them to assess their challenges and offer the right
end-to-end solution, tailored to their size and budget.
Transforming businesses and driving growth
Our business model
continued
Creating value for businesses
Old process
PowerCurve
(for executing client-specific
decision strategies)
Decision strategies created using
Ascend
Intelligence Services
New process
One business that needed our help was a loans
company which consolidates credit card debt for
consumers. The debt is simplified into just one
loan, which is then paid by the consumer in
instalments and very often at a much lower
interest rate. They wanted to grow their market
share and increase the positive impact they were
having on people’s financial lives. But they were
constrained by a highly manual review process,
and so wanted to automate it.
They wanted to improve the online customer
experience and their capacity to add customers,
while still managing risk and compliance with
regulations.
We worked with them to create a whole new
process based on our integrated platforms, such
as PowerCurve and Ascend. Automated from end
to end, the new process provides more balanced
decisions significantly faster, and at a lower cost.
It’s also easier for consumers, putting them on the
path to more manageable debt repayment, more
quickly. Because of this automation the lender has
been able to significantly grow their reach and
help more consumers become free of debt.
Data
Experian
consumer data
Analytics/Attributes
Models/
Scores
Prebuilt scores
(e.g. FICO score)
Decisions
Actions
Data
Experian
consumer data
Analytics/Attributes
Premier Attributes
Trended 3D Attributes
Models/Scores
Vantage Score
Custom Experian-built
machine-learned model
(Ascend accessed via
PowerCurve)
Decisions
Actions
Experian plc
Strategic report
26
really cares
improve their processes
This company
about its customers and wanted to
so they could reach even more people.
Nichole Larmore
Data and Decisioning Expert, Preferred & Vertical Market Sales, Experian North America
Monthly loan applications
Loans booked per month
Improved capacity
Remove manual review bottleneck to
improve capacity to book more loans
Monthly loan applications
Loans booked per month
Current capacity
Manual review bottleneck
By replacing manual review bottlenecks with automation, capacity and growth can be improved.
27
Experian plc
Annual Report 2023
Strategic report
Our strategy
Fulfilling our purpose
At the core of our strategy is the purpose on which Experian is built: being a force for inclusion that brings financial
power to all. We live this purpose through our products and our culture. We take deep pride in the positive impact
we have across society. It underpins how we think strategically.
How we build a stronger, more advantaged Experian
A unique interplay
One of the unique aspects of Experian is the interplay between
the two parts of our business, B2B and Consumer Services.
This sits at the very heart of our strategy. We see it as our
mission to help consumers use their own data to get access
to the best and most suitable offers. At the same time this
nurtures our B2B businesses and helps us to use the data
contributed to develop even better propositions. We are very
proud of the way we have pioneered this concept, through
Experian Boost, and now Experian Lift and Experian Go.
We are confident that our strategy will continue to deliver
strong, sustainable growth which compounds over time. We
pursue our goals through a clear strategic framework
and a disciplined approach to capital allocation. We identify
specific opportunities that are directly addressable by
Experian. We pursue these opportunities through defined
strategic initiatives, investing organically and inorganically to
realise our ambitions, and we believe this approach has been
an important factor in our strong track record of delivery.
Over time, the wide range of uses that our clients
can put our data and analytics towards is also
expanding. We all now expect the organisations we
deal with to serve us in the digital sphere, to
anticipate and personalise the services they offer
us and to behave responsibly. Organisations in turn,
while satisfying these demands, need to be
commercially successful while managing risk,
minimising fraud, and ensuring they are compliant.
More and more, these desired outcomes rely on the
data and sophisticated solutions that we provide.
These shifts, and the need to create trust between
the provider of a service and their end-customer,
open new ways for data and advanced analytics to
be used. The nature of our products also means we
become deeply embedded in client operations and
this allows us to forge close relationships, working
with our clients to understand their requirements
and expand alongside them by providing more
applications.
Our ambition is for Experian to be recognised as
one of the world’s most innovative data, analytics
and software companies, delivering advanced,
cloud-based B2B solutions. We are very proud of
the achievements and recognition we increasingly
attract for this, from our clients and wider afield.
We also seek to build trust and enduring
relationships with consumers. This is the
cornerstone of our Consumer Services strategy.
Our ambition is to create an unrivalled platform to
help consumers manage their finances. We are well
on our way to realising this ambition having
established relationships with millions of
consumers and by constantly adding to the ways
people can interact with us. We want to bring more
people into the financial system, help them to build
credit and save money, as well as protect their own
and their family’s identity.
While our strategy is built around the deepest,
broadest and most unique datasets available
in our markets, we do much more. To data we
add advanced analytics and decisioning tools
to create highly differentiated solutions that
solve client challenges and open up new
markets to address. Our datasets have unique
value, and we strive to make them the most
powerful and accurate sources available,
indispensable to our customers, and helping to
address a wide range of their needs.
We are adept at spotting and developing new
market spaces to enter and existing spaces
where we can expand. This is a key driver of
our thinking and has seen us create several
large new businesses, usually by cross-
pollinating our data and analytics. We estimate
that the market opportunity directly
addressable by Experian exceeds US$150bn.
There are many examples of where we have
successfully entered new markets or where
we are prospecting new ones. This includes
some exciting opportunities today in countries
such as Brazil, in sectors as wide-ranging as
health, automotive and agriculture, or in
attractive growth markets like digital
marketing.
Business-to-
Business
Consumer
Services
Experian plc
Strategic report
28
Each year, we sharpen our focus on a defined list of strategic growth
initiatives. Our goal is to ensure that we are executing at pace, pursuing
the biggest opportunities and that we are addressing the highest-growth
customer segments.
Our key strategic growth initiatives
Our strategic framework helps us to identify
customer challenges. Deeply informed by
customer trends, our Strategic Focus Areas
(SFAs) define where we focus our product
strategy and investment decisions, and help us
to target innovation. We then monitor and
manage innovation projects and evaluate
progress. Each region and business adapts
and uses this framework to develop more
detailed focus areas which are relevant to their
particular market. Plans and progress are then
regularly reviewed by our senior management
team and Board, informing our decisions on
which areas to prioritise for further
investment.
Our five key areas of strategic focus are to:
1. Make credit and lending simpler, faster and
safer for consumers and businesses
2. Empower consumers to improve their
financial lives
3. Help businesses verify identity and combat
fraud
4. Help organisations in specialised verticals
harness data, analytics and software to
make smarter decisions
5. Enable businesses to find, understand and
connect with audiences
We have invested in new technology and
infrastructure to power new, innovative
solutions, that deliver the freshest insights.
Our technology helps transform the way
businesses operate and consumers
thrive today.
Defining our priorities –
our Strategic Focus Areas
1. Lead the next
generation
of credit, risk
and identity
See page 30
2. Use our scale
to grow in adjacent
and existing
customer markets
See page 32
3. Transform
Consumer Services
into a world-leading
consumer finance
platform
See page 34
We are
to deliver the
freshest insights.
innovating
Ranked number 9 in the 2022 IDC FinTech Ranking.
29
Experian plc
Annual Report 2023
Strategic report
The brilliance of AI is that it's
and gaining greater accuracy. It blocks the real fraudsters,
leading to happier customers and improved revenue.
constantly learning
1. Lead the next generation
of credit, risk and identity
Be at the forefront of the use of new datasets, user-
permissioned and Open Data to widen our ability to
help clients across credit risk, fraud prevention and
transaction categorisation
Drive increased penetration of Ascend and our other
integrated propositions encompassing data,
decisioning and analytics
Accelerate our position in Verification and Employer
Services by scaling in the USA and prospect nascent
markets in the UK and Brazil
Expand across our integrated identity and fraud
prevention offerings
Seize a unique opportunity in Brazil as positive data
transforms the market
Our growth initiatives
Rene Link
Product Manager Aidrian,
Experian DACH
Our strategy
continued
Experian plc
Strategic report
30
future
of fraud prevention.
Aidrian
Shopping online can be risky these days,
both for customers and businesses, with
billions of dollars lost every year to
fraud. In an effort to combat this, many
businesses end up blocking legitimate
online customers due to using outdated
or underperforming fraud rules.
Resulting in frustrated customers and
lost revenue.
This problem is solved with powerful,
adaptive AI that gets ahead of the
fraudsters. Experian’s new fraud
prevention platform, Aidrian, uses AI to
identify subtle data patterns, not easily
found by humans, to extract new
insights and create new fraud rules.
These rules block certain user actions,
such as suspicious logins, identity theft,
or fraudulent transactions, while letting
legitimate customers through.
Aidrian assesses up to 99.9%¹ of all
transactions accurately and reliably
filters out fraud. It can result in up to
15%¹ more revenue. Because it's
constantly learning Aidrian also
identifies and adapts to new and
emerging fraud threats. This helps to
keep everyone safer while they transact
in the digital world.
Scan me
Find out more about
Aidrian
Shopping made safe using
artificial intelligence
15
%
1
more sales revenue
1
Source: Experian-derived metric based on client
assignments.
Payment provider
Denmark
This is the
31
Experian plc
Annual Report 2023
Strategic report
2. Use our scale to grow
in adjacent and existing
customer markets
Capitalise on the repositioning of our Marketing
Services business to lead in digital identity resolution
to support marketers
Further expand in our priority verticals of North
America Health and North America Automotive and
prospect new ones like Brazil Agribusiness
Our growth initiatives
Farming more
and more
effectively
sustainably
Guilherme Costa
Director of IT, Agribusiness,
Serasa Experian, Brazil
means more food can be grown to meet future
demand, while protecting the environment.
This is important for everyone’s future.
Our strategy
continued
Experian plc
Strategic report
32
We can
easily
monitor
Smart ESG
What do farmers want to do? They want
to farm. They want to grow crops and
look after their animals, rather than
spend time on paperwork. However, in
places like Brazil, farmers are now
having to deal with much higher levels of
compliance when applying for credit.
Access to credit is essential, because it
allows farmers to plan their planting and
buy fertiliser, seeds and equipment.
They have to show not only that they can
repay debt, but also that they are not
involved in any illegal deforestation,
encroachment onto indigenous land,
modern slavery or environmental
infractions. And they need to show this
every time they apply for credit or sign
up with a new food distributor.
Experian’s Smart ESG platform takes
care of this for farmers, by providing
lenders with a holistic view of a farm’s
compliance, and it monitors that
compliance daily. A process that used to
be highly manual and take weeks, now
takes minutes.
This helps lenders explore new
agricultural regions, understand the
market and land use and expand into
agribusiness, while meeting regulations
and reducing their socio-environmental
and reputational risk. For farmers it
means faster access to credit, as well as
certification of their products going into
the food supply chain. Helping farmers
do less paperwork, and more farming.
Helping farmers focus on farming
US-based multinational
food distributor
100% of our 15,000 soybean suppliers
and ensure they are farming in a
compliant, sustainable way.
33
Experian plc
Annual Report 2023
Strategic report
With two-thirds of Americans living paycheck
to paycheck, a few hundred dollars can be
the difference between
or falling into debt.
Experian can make that difference.
saving money
Ben Kurland
Strategy and Growth Director,
Experian Consumer Services
North America
3. Transform Consumer
Services into a world-leading
consumer finance platform
Grow and deepen our relationships with our
members
Enhance our premium services by introducing new
and richer features
Grow our marketplaces by extending our position
in existing verticals and entering new ones
Introduce a range of new features and services to
further increase everyday relevance and frequency
of engagement with our members
Our growth initiatives
Our strategy
continued
Experian plc
Strategic report
34
Chloe R
BillFixer
over the next 12 months on my
DirecTV and Cox internet bills.
They were superfast and provided
excellent customer service.
saved
me
US$900
Experian BillFixer
Every year, bills get more expensive and
inflation is pushing prices ever higher.
Trying to change providers or get a
discount can be an incredibly stressful
and time-consuming experience.
Experian BillFixer saves consumers
money by helping them negotiate a
lower rate for the exact same service,
whether for your TV, internet, phone or
other bills like home security.
The process is simple and seamless
on our US app: just agree to the terms,
select the provider, and upload a copy
of the bill from any major US provider.
We contact the provider and negotiate
with them directly, locking in discounts
and credits.
On average our Premium members save
US$264 a year. With the built-in AutoFix
function, Experian BillFixer automatically
renegotiates any bills before the
discount rate expires, keeps track of
price increases and looks for other
savings opportunities. Saving
consumers time, money and stress.
Scan me
Find out more about
Experian BillFixer
Lower your bills and save money,
stress free
35
Experian plc
Annual Report 2023
Strategic report
Sustainable business
Environmental, social and governance
We are making improvements in financial health by using our data, products and expertise
to help people thrive at every stage of their financial journey.
Our strong focus on environmental, social and governance (ESG) opportunities and risks is
critical to realising this ambition, growing our business and fulfilling our purpose of creating
a better tomorrow.
93 million points added to credit
scores
Around 13 million consumers in the USA
have connected to Experian Boost. More than
93 million points have been added to credit
scores over the past four years by adding
positive data, such as on-time payments from
utility bills or streaming services – and now
rent – to their Experian profiles. Experian
Boost was recognised at Fast Company’s 2022
World Changing Ideas Awards as having the
potential to effect true system change.
113 million connections
Our United for Financial Health programme
to improve financial education among
underserved communities has made more
than 113 million connections over the last
three years, meeting our 100 million target
a year early.
Our Global Data Principles
We continued to establish our Global Data
Principles across the business, to reinforce
our focus on security, accuracy, fairness,
transparency and inclusion in the way we treat
data and those it belongs to.
Great Place to Work
Employee engagement increased by four
points to 82% across our 22,000 employees
and we were certified as a Great Place to Work
in 22 countries.
106 million people reached
Our social innovation products, designed to
provide additional societal benefits, have
reached 106 million people since 2013 –
meeting our 100 million target two years
early – and generated US$241m in revenue.
More women in management
Representation of women increased to 34% of
our senior leaders. Women also make up 36%
of our mid-level leaders and 44% of our total
workforce.
65% reduction in Scopes 1 and 2
We have achieved a 65% reduction in Scope
1 and 2 emissions since 2019, currently
outperforming our 50% science-based
reduction target (set in line with a 1.5ºC climate
scenario). We have achieved this through our
focus on consolidating offices, improving
energy efficiency and sourcing renewable
electricity. We have also enhanced the way we
measure Scope 3 emissions to include more
supplier-specific data.
External recognition
We continued to rank highly in external ratings
and rankings that recognise our strong ESG
approach and performance (see page 38).
Highlights in FY23
Our performance in FY23
Our goals
Target year
FY23 status
Financial health
1
Reach 100 million people through social innovation products (starting from 2013)
2025
Exceeded
Connect with 100 million people through our United for Financial Health programme
(starting from 2020)
2024
Exceeded
Diversity
Increase the proportion
of women in our:
senior leaders to 40%
2024
On track
mid-level leaders to 42%
2024
On track
total workforce to 47%
2024
On track
Environment
Become carbon neutral in our own operations
2
2030
On track
Reduce Scope 1 and 2 emissions by 50% (from 2019)
3
2030
Exceeded
Reduce Scope 3 emissions from purchased goods and services, business travel
and fuel- and energy-related activities
4
by 15% (from 2019)
5
2030
In review
Offset 100% of our remaining Scope 1 and 2 emissions
2025
On track
1
Having met both our financial health targets early, we will continue extending our reach and connections in these areas as we work to more meaningfully measure our impact on society with a particular
focus on core products.
2
Includes all Scope 1 and 2 emissions, as well as Scope 3 emissions from purchased goods and services, business travel and fuel- and energy-related activities (which represent 83% of our baseline
emissions in Scope 3) in line with the boundaries covered by our Scope 3 target approved by the Science Based Targets initiative (SBTi). Once we have achieved our SBTi-approved targets, we will invest in
high-quality carbon offsetting projects to offset the remaining Scope 1, 2 and 3 emissions within the boundaries of our SBTi-approved targets to achieve carbon neutrality in our own operations by 2030.
3
Target approved by SBTi as in line with a 1.5ºC climate scenario.
4
Also known as ‘well-to-tank’, is an average of all the greenhouse gas emissions released into the atmosphere from the production, processing and delivery of a fuel or energy.
5
Target approved by SBTi as in line with a 2ºC climate scenario. Due to an upgrade to our Scope 3 methodology we will be updating this target (see page 60 for further details).
Experian plc
Strategic report
36
Our sustainable business strategy
ENABLED BY
Treating data with respect
SUPPORTED BY
Working
with
integrity
See page 54
Inspiring
and supporting
our people
See page 51
Protecting
the
environment
See page 56
Contributing to the UN Sustainable Development Goals
1.4
8.10
9.3
OUR PURPOSE
Creating a better tomorrow
for consumers, for businesses, our people and communities
OUR SUSTAINABLE BUSINESS STRATEGIC PRIORITY
Improving financial health for all
through our
Accuracy
See page 47
Fairness
See page 48
Transparency
See page 48
Inclusion
See page 49
Security
See page 45
Core
products
See page 42
Social
innovation
See page 43
Community
investment
See page 43
37
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Our priorities
We can add the most value to society by
improving financial health for all, and we have
made this our sustainable business strategic
priority.
Helping people improve their financial health
enables them to get fairer access to credit and
the essentials they need to transform their
lives – from having a home or building their
business, to paying for education and
healthcare. This in turn drives social and
economic development, and contributes to
three of the United Nations Sustainable
Development Goals, including helping to lift
people out of poverty (as outlined to the right).
Our sustainable business strategy and our
growth strategy are aligned and mutually
reinforcing. Our focus on improving financial
health supports the long-term revenue growth
and success of our business in many ways. For
instance, increasing financial inclusion grows
our total addressable markets by creating
millions of potential new consumers for us and
our clients around the world. One such
product, Experian Go, has the opportunity to
help 28 million US consumers who are 'credit
invisible' establish a credit report and become
visible to lenders. Equally, this focus helps
drive innovation, in ground-breaking products
like Experian Boost. It also creates new
revenue streams, such as our Limpa Nome
debt renegotiation product, which significantly
contributes to our Consumer Services revenue
in Brazil. Being a purpose-driven business
helps attract and retain talent, and it also
motivates our people. 88% of our employees
are proud to tell others that they work at
Experian. Lastly, it enhances our reputation
and strengthens stakeholder relationships,
whether that be with consumers, clients,
employees, investors, regulators or
governments. Our mission to improve financial
health is aligned with three of our five Strategic
Focus Areas (see page 29): make credit and
lending simpler, faster and safer for
consumers and businesses; empower
consumers to improve their financial lives; and
help businesses verify identity and combat
fraud.
Delivering these positive impacts for society
and our business depends on our ability to
access and use data from individuals and
businesses around the world. Treating that
data with respect is essential to maintain trust
– and failure to keep it secure is one of our
biggest business and ESG risks.
One of our core beliefs is that how we work is
as important as what we do, and our strategy
is built on a strong culture of corporate
responsibility. We aim to inspire and support
our people by embracing and developing
diverse talent and creating an inclusive
working environment that supports high
performance. We are committed to working
with integrity, and we strive to do our part to
protect the environment and tackle climate
change.
This responsible culture also helps us recruit
and retain people with the expertise and
experience we need to grow our business and
meet our sustainable business goals.
Our sustainable business strategy is informed
by an assessment of our most material ESG
factors, based on consultation with senior
leaders who represent different regions and
functions across the business.
Our strategic priority to improve financial
health can make the most meaningful
contribution to the United Nations
Sustainable Development Goals by
supporting progress towards:
We also contribute to several of the other
Sustainable Development Goals, for
example through our work to improve
diversity, equity and inclusion (see page 51),
tackle modern slavery (see page 55) and
reduce climate impacts (see page 56).
External recognition in FY23
Contributing to the United Nations
Sustainable Development Goals
By 2030, ensure that all people,
in particular the poor and the
vulnerable, have equal rights to
economic resources, as well as
access to appropriate new
technology and financial
services, including microfinance.
Strengthen the capacity of
domestic financial institutions to
encourage and expand access
to banking, insurance and
financial services for all.
Increase the access
of small-scale industrial and
other enterprises, in particular in
developing countries, to financial
services, including affordable
credit.
IDC FinTech Top 100:
Experian ranked 9th in the
2022 Top 100 in recognition
of our record of innovating
solutions that power
financial institutions and
deliver benefits to
consumers
Business Intelligence
Group (BIG):
We won a BIG Innovation
Award 2023 for Experian
Go
Great Place to Work:
We have been certified as
a Great Place to Work in 22
countries (see page 52 for
more employer awards)
CDP Climate Change:
‘A-’ rating
CDP Supplier Engagement
Rating (SER):
'A-' rating
Fortune's America’s Most
Innovative Companies list
2023:
We have been named
among firms at the
forefront of innovation
today and in the future
Fast Company World
Changing Ideas:
Experian
was recognised in Fast
Company’s List of 2022
World Changing Ideas as
having the potential to
effect true systems change
MSCI:
‘A’ rating for ESG
investment risk
Sustainalytics:
Experian
rated in the top 3% of
companies globally and
received a Regional
Top-Rated Badge for the
second year running. Our
score of 11.4 positions us
as Low Risk for investors
Financial Times:
Experian
was identified as one of
Europe’s Climate Leaders
2023 by the Financial
Times and Statista
FTSE4Good:
Experian has
been a member of the
FTSE4Good ESG index
since 2012
Target 1.4
Target 8.10
Target 9.3
Regular engagement with investors and other
stakeholders helps us refine our priorities. See
pages 16-19 for more on how we engage with,
and create value for, our stakeholders.
Experian plc
Strategic report
38
Governance of ESG
We believe strong ESG performance can be
a source of competitive advantage, as well
as boosting our reputation and strengthening
our relationships with all our stakeholders.
Our ESG strategy helps us set targets and
commitments, drive progress and enhance
transparency through our ESG reporting and
disclosures. It is developed, approved,
implemented and overseen through a robust
governance structure. See the organisation
chart below and see page 102 for the division
of responsibilities, including ESG, across the
Board.
The Board oversees our ESG strategy and
performance. Board members receive a
written update on ESG activities ahead of every
Board meeting, as well as an annual in-depth
presentation from our Chief Sustainability
Officer that educates them on the evolving
global ESG context and provides a detailed
ESG governance at Experian
Experian Board
Reviews ESG targets, strategy, performance and policy updates as part of regular Board reporting, risk
management and budget-setting processes. Approves financial and non-financial disclosures.
Audit Committee
Oversees management of risks, including any ESG risks, reviews and approves our register of principal risks and
opportunities, and oversees financial disclosures, to ensure the Board has full oversight.
Group Operating Committee (OpCo)
Reviews and approves ESG strategy and
targets, reviews ESG performance data
quarterly and reports to the Board on these
matters.
Risk Management Committees
(executive and regional)
Oversee management of risks, including
ESG risks, at global and regional level, with
oversight from the Executive Risk
Management Committee.
Global sustainability team
and regional leads
Support implementation of our ESG strategy, together with
a network of specialists and steering groups across the
business that manage our Social Innovation, community
investment, health and safety, and environmental
programmes and impact.
Regional business units
Support implementation of our ESG strategy.
ESG Steering Committee
Develops ESG strategy, metrics and
targets, oversees and prioritises
investment decisions to support
implementation of our ESG programme,
reviews ESG performance data quarterly,
discusses and agrees responses to
relevant market and regulatory
developments.
update on our ESG strategy and performance.
The Group Operating Committee reviews and
approves our ESG strategy and targets, and
receives regular updates on performance.
The Chief Financial Officer is executive sponsor
of our overall ESG programme and the
Company Secretary oversees the Group’s
Sustainability function. They both sit on the
Executive Risk Management Committee that
oversees how we manage risks globally,
including ESG risks, with oversight from the
Audit Committee.
Our ESG Steering Committee, comprised of
executive sponsors and workstream leaders
and chaired by the Chief Financial Officer,
meets six times a year to oversee our ESG
agenda. It steers our strategy, metrics and
targets, and helps to shape the priorities of
our ESG programme. Topics discussed this
year included: social impact initiatives,
communications and engagement, data
security and ESG in investor relations, as well
as climate-related items.
The ESG Steering Committee also regularly
discusses and agrees appropriate responses
to relevant market and regulatory
developments and stakeholder needs, and
their potential implications for our business
and stakeholders. These are also monitored
continually by our Sustainability, Investor
Relations, Government Affairs, Finance and
Corporate Secretariat teams.
Our Chief Sustainability Officer is responsible
for ensuring successful implementation of
our ESG plans across all our workstreams.
A central sustainability team and a network
of regional leads, specialists and steering
groups across the business manage our
Social Innovation, community investment,
health and safety, and environmental
programmes and impact.
Chief Sustainability Officer
Responsible for ensuring successful implementation of our ESG programme and delivery of our ESG strategy and targets.
39
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Managing ESG risks
The Board and our Executive Risk Management
Committee review our principal risks on an
ongoing basis. Five of our eight principal
business risks are relevant to ESG (see table
opposite). In addition, we continue to identify
and analyse emerging risks, including those
related to ESG, such as climate risks. See
pages 57-59 for details on climate-related
risks and opportunities.
See pages 78-85 for more on our principal
risks and risk management processes,
including our Three Lines of Defence approach.
Embedding ESG in innovation
Our culture of innovation puts consumer and
client needs first. We have five Strategic Focus
Areas (see page 29), against which we execute
our strategy, and which shape our innovation
investment in core products. Three of these
Strategic Focus areas underpin our
sustainable business priority of improving
financial health as outlined on page 38.
In addition, we invest in developing new
products that are specifically designed to offer
additional societal benefits, as well as creating
revenue for our business, through our Social
Innovation programme (see page 43). The
funding model for social innovation products is
aligned with our global innovation framework.
The Social Innovation programme is governed
by a global steering committee facilitated by
the Global Head of Social Innovation and
chaired by the Group President of Experian
Consumer Services North America. The
steering committee also includes our Chief
Sustainability Officer, Chief Investment Officer,
and Company Secretary, as well as senior
representatives from each region. We have a
sub-committee that governs lower-level
funding to explore early-stage ideas.
We also have strict processes to ensure we
build critical ESG considerations, such as data
ESG-related business risks*
Principal risk
Related ESG topic/sustainable business priority
Data loss/misuse
Legislative/regulatory
change and compliance
Resiliency
Business conduct
Talent acquisition
and retention
Treating data with respect
(data security)
Potential to affect all – we monitor climate-related
risks that could impact on our enterprise resilience
Working with integrity
Inspiring and supporting our people
Potential to affect all – and particularly treating
data with respect (data privacy)
security, privacy and accuracy, into all our
products and services. We extend our high
standards to suppliers through our third-party
risk management framework.
Setting goals and measuring
performance
We have set quantitative goals to support our
sustainable business strategy in three key
areas: improving financial health, diversity and
environment.
Our initial focus was on increasing the reach of
products developed through our Social
Innovation programme. Having reached
around 35 million people over the preceding
seven years, in FY20, we set a stretch goal to
reach 100 million people by 2025. We measure
reach as the number of consumers and small
business owners who interact with our social
innovation products either directly or indirectly.
When we launched our United for Financial
Health (UFH) community investment initiative
in 2020, our initial goal was to connect with 15
million people within a year. We connected with
double that number in the first year so we set
an ambitious new goal to connect with 100
million over four years (by 2024). To measure
the reach across our UFH programme, we
define connections as the total number of
users who have viewed UFH content
containing the tracked hashtag, keyword, URL
or mention on social media channels, blogs
and websites.
We met both these goals early this year, but we
aim to continue to increase the reach and
number of connections in these areas as we
work to more meaningfully measure our
impact on society. We are already able to
demonstrate the impact, as well as reach, of
certain products such as Experian Go in the
USA and Limpa Nome in Brazil (see pages
42-43). Quantifying social impact across
multiple products or programmes is more
challenging, but we are working on a way to do
this with a particular focus on the impact our
core products have on improving financial
health.
The targets we have set for diversity focus on
increasing gender diversity at all levels of our
business as part of our wider DEI strategy.
Our environment goals focus on reducing our
operational and value chain carbon footprint,
which is our most material environmental
impact. These are approved by the Science
Based Targets initiative, supporting our
commitment to become carbon neutral in our
own operations by 20301.
Target met: Reach
100
m
people by 2025 via our
Social Innovation
programme since 2013
Target met: Connect with
100
m
people by 2024 via our
United for Financial
Health community
investment initiative
*See Our sustainable business strategy on page 37 for reference.
Experian plc
Strategic report
40
ESG reporting and disclosures
Key ESG policies
Annual Report:
This section of our Annual
Report sets out our approach and
performance on our most material ESG
topics.
CDP:
We disclose detailed information on our
climate approach and performance via the
CDP, and you can view our CDP disclosure on
our website.
Diversity, Equity and Inclusion Report:
We
report in more detail on our diversity, equity
and inclusion goals and progress.
ESG performance data:
We report detailed
year-on-year performance data on material
ESG topics.
EU Sustainable Finance Disclosure
Regulation (SFDR):
We disclose the SFDR’s
Principal Adverse Impact indicators on our
website.
Gender Pay Gap Report:
We disclose our
gender pay gap in the UK.
Improving Financial Health Report:
We
highlight how we are creating positive social
impact by improving financial health.
Modern Slavery Statement:
We set out the
steps we have taken to ensure slavery,
human trafficking and child labour are not
taking place in our supply chains or in any
part of our business.
Non-financial information and s172(1)
statement:
We report in line with Section 172
of the UK Companies Act 2006 (see page 64).
Sustainability Accounting Standards Board
(SASB):
We report against the SASB
framework on material issues (see page 65).
Taskforce for Climate-related Financial
Disclosures (TCFD):
We report in line with
TCFD recommendations (see page 56).
Tax Report
: We explain our approach to tax
affairs and detail our regional corporate tax
contributions.
We publish key ESG policies on our website.
These include:
a
Global Code of Conduct
a
Anti-Corruption Framework
a
Global Data Principles
a
Environmental Policy
a
Diversity, Equity and Inclusion Key
Principles
a
Global Approach to Mental Health and
Wellbeing
a
Health and Safety Policy
a
Supplier Code of Conduct
a
Modern Slavery Statement
a
Statement on Salient Human Rights
a
Tax Policy
1
Includes all Scope 1 and 2 emissions, as well as Scope 3
emissions from purchased goods and services, business
travel and fuel- and energy-related activities (which
represent 83% of our baseline emissions in Scope 3) in line
with the boundaries covered by our Scope 3 target approved
by the Science Based Targets initiative (SBTi). Once we have
achieved our SBTi-approved targets, we will invest in
high-quality carbon offsetting projects to offset the
remaining Scope 1, 2 and 3 emissions within the boundaries
of our SBTi-approved targets to achieve carbon neutrality in
our own operations by 2030.
The Finance team centrally collates data related
to these goals and wider ESG performance for
quarterly review by our ESG Steering
Committee and our Group Operating
Committee. Principles of data collection are set
out by our Finance team and submitted by each
region for central reporting. Our ESG data
reporting methodologies are published on our
website, together with detailed ESG
performance data that we disclose annually.
ESG data is gathered, shared and discussed
with global and regional leadership through our
quarterly business reviews.
Certain non-financial metrics – including
employee engagement, diversity and inclusion,
ESG considerations and risk – are factored into
the holistic assessment of the Company’s
short- and longer-term performance.
We also integrate ESG into employee pension
investments. Our defined contribution pension
plan in the UK includes an allocation to a fund
that explicitly includes ESG in its investment
strategy, and members of the plan also have the
option to select a focused ethical fund.
Scan me
to view our policies
Scan me
to view episodes of
In my bag with Coco Jones
and Freddie Ransome
In my bag
We partnered with singer Coco Jones and
influencer Freddie Ransome to create a video
series to inform and inspire 18-24 year-olds,
BIPOC (Black, Indigenous and people of colour),
and those in the justice system who are eligible
for second chance opportunities.
41
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
A quarter of the world’s adult population lacks
access to banking products. Many of those
who do have access to financial services still
cannot access fair, affordable credit, or face
spiralling debt. 28 million people in the USA
and four to five million in the UK are ‘credit
invisible’ because their financial profiles are
too limited for lenders to make an informed
decision; and more than 63 million people in
Brazil have unmanageable debts that are
affecting their credit rating.
The current cost-of-living crisis has
exacerbated threats to financial health and
makes access to fair, affordable credit all the
more important. In the UK alone, the Financial
Conduct Authority have found 80% of adults
have reported an increase in cost of living, half
the population is now borrowing to make ends
meet and more than a quarter (27%) are now
classed as having low financial resilience.
We support financial inclusion and enable
better financial health for millions of people
around the world through our core products,
Social Innovation programme and community
investment initiatives – and we aim to reach
millions more.
To date, we have been able to measure the
reach of the products developed through our
Social Innovation programme and the
connections made through our flagship United
for Financial Health community investment
programme. We are currently working on a
way to measure the social impact of our core
products which have the greatest potential to
improve financial health at scale – and, in doing
so, create new revenue streams and growth
opportunities for our business.
As well as empowering consumers to improve
their scores directly, we have partnered with
lenders to improve financial inclusion through
products like Experian Lift that do not rely on
traditional credit data alone. Applying machine
learning and other advanced analytics to
additional datasets regulated by the US Fair
Credit Reporting Act (FCRA), Lift Premium
enables lenders to further enhance the
accuracy of credit risk scores for 98% of
incoming applications and enables scoring of
65%-75% of ‘credit invisibles’ in the USA.
In the UK, the fairness assessment toolkit we
trialled last year to help lenders identify and
support vulnerable consumers has been
launched commercially to support access to
loans that would otherwise have been
declined. The new global partnership we have
announced with Prove Identity aims to advance
financial inclusion through next-generation
identity verification technology, enabling
companies to extend financial services to more
consumers in traditionally underbanked
populations, including those who do not
already have a credit profile, while also
mitigating digital fraud such as synthetic
identity fraud.
Keeping track of pay, and cutting expenditure,
can make a big difference to financial health in
the current cost-of-living crisis. This year, we
have expanded our employer services offering
in the UK with the acquisition of PayDashboard,
which delivers online payslips together with
features to help employees understand their
pay. We have also launched two new products
designed to help consumers in the USA save
money on bills: Experian Insurance Services,
a new way to shop for car insurance; and
We also channel innovation for financial health
through our DataLabs and global hackathons.
Core products
Many of our core products contribute to
improving people’s financial health – either
directly through our Consumer Services
business or indirectly through solutions for
clients, such as for lenders.
Our consumer-focused tools enable consumers
to take control of their financial lives and reach
their credit and money goals, with financial
inclusion as a key driver. Our data and analytics
provide lenders with the information they need
to offer more loans at fairer rates, which in turn
enables people to improve their financial health.
In the USA, we offer game-changing consumer
services like Experian Boost and Experian Go
that are designed to improve financial inclusion
and financial health by unlocking access to fair
and affordable credit.
Experian Boost provides consumers with the
opportunity to enhance their credit scores by
choosing to add positive data – such as
on-time payments from utility bills or
streaming services – to their Experian profiles.
This year, we added the option to contribute
rent payments as well, to enable millions of
renters to instantly improve their FICO® Score.
Around 13 million US consumers have
connected to Experian Boost. More than 93
million points have been added to credit scores
using Experian Boost in the last four years.
Since launch in FY22, Experian Go has enabled
more than 130,000 US consumers who were
‘credit invisible’ to establish a credit profile in
just minutes.
Improving financial health for all
Our goal is to help people thrive on their financial journey by empowering them to
establish a credit identity and build their credit score, improve their financial literacy and
confidence, protect their identity and personal data, and manage their finances and debt.
Scan me
to read more detail in
our dedicated Improving
Financial Health report
Improving Financial
Health for all
Improving Financial Health Report 2023
13
m
people have connected to Experian Boost in
the USA. More than 93 million points have been
added to consumers' credit scores through
Experian Boost in the last four years
168
m
consumers worldwide use our free platforms
to access products and services to help
manage their credit profiles
Scan me
to find out more about
Lift Premium
Experian plc
Strategic report
42
Scan me
to find out more about
our Support Hub
Experian BillFixer, which negotiates on behalf
of Experian members to get them better rates
on bills such as cable, internet and phone.
Our focus on improving financial health
extends beyond consumers to include small
and medium enterprises (SMEs), which form
the backbone of economies in countries such
as Brazil and the UK. In Brazil, almost 1.5
million SMEs took up our offer of a free SME
Credit Score consultation this year, and our
agreed acquisition of FinTech MOVA (pending
regulatory approval) will support the
development of new credit solutions that make
it easier for SMEs to access fair and affordable
credit. In the UK, our new Credit Review
Service, launched in partnership with
Capitalise, is designed to help thousands of
SMEs take control of their finances and build
financial resilience.
Worldwide, 168 million consumers use our
free platforms to access products and
services that can help them understand and
manage their credit profiles. In India, we have
launched a new service that allows consumers
to check their credit score free of charge using
WhatsApp.
Our Consumer Services business also helps
individuals spot potentially fraudulent
transactions in their credit profiles, and we
enable Experian members in Brazil, the UK
and the USA to lock their profiles to reduce the
risk of identity theft and fraud (see page 47).
We also offer a range of solutions to help
lenders and other clients prevent fraud. Our
new Experian Fraud Score in the UK uses
advanced analytics technology to support
more businesses – large and small – in the
battle against fraud, accurately identifying two
in three frauds from the riskiest 1% of
transactions. Overall, our core fraud and
identity theft products are estimated to have
prevented at least US$12bn in fraud for our
clients this year, and across the Group fraud
and identity products generated 11% of our
business revenue.
Social innovation
Our social innovation products are specifically
designed to offer additional societal benefits as
well as generating revenue for our business.
Since 2013, they have reached more than 106
million people – exceeding our target of 100
million by 2025 – and generated US$241m in
revenue for a total investment of US$12m.
Of the 34 product ideas we have developed
through our Social Innovation programme over
the last ten years, 20 have been launched –
including ground-breaking products such as
the Limpa Nome Recovery Portal, which has
become a core part of our consumer strategy
in Brazil and helped collectively write off more
than US$21bn-worth of debts to date.
The Limpa Nome Recovery Portal is just one of
the products that were initially developed
through the Social Innovation programme and
have now become part of our mainstream
business. Prove-ID Link, designed to help
financially excluded people in India verify their
identity, is integrated into our CrossCore
identity-authentication platform. The Trilha
Financeira (Financial Trail) online training has
been taken on by our Consumer Services
business in Brazil. And several social
innovation products form part of our Experian
Health offering in the USA.
This year, we partnered with charities and
businesses to launch a Support Hub in the UK
(see above) that enables consumers to easily
notify multiple organisations about their
support needs and vulnerabilities through a
single action. This, in turn, enables clients to
tailor customer support to better meet these
needs. It initially focuses on three specific
support needs – sight, sound and mind – and
we will integrate other types of needs in future.
We have also created a credit education
simulation tool, to be tested in the coming year,
to support financial inclusion in the USA, and
the Smallholders Marketplace to improve
access to credit among smallholder farmers in
Brazil (see page 61). Newly funded social
innovation solutions this year include plans to
extend the Support Hub to cover additional
support needs in the UK, financial
management support for micro and small
businesses in Brazil, and a product to enable
SMEs in Brazil to gain access to credit based
on an assessment of their ESG rating.
Community investment
Our flagship United for Financial Health
programme to empower underserved
communities through financial education has
connected with over 113 million people since it
launched in 2020, exceeding our target of 100
million by 2024.
This year, highlights included: transforming the
Protect the Bag online video series, launched
last year with Grammy Award-winning artist
Lecrae, into live financial education forums to
empower Black Americans; collaborating with
singer Jake Wesley Rogers to amplify key
messages among LGBTQ+ communities in
North America; and joining forces with football
star Adebayo Akinfenwa and money influencer
Iona Bain on a campaign to educate young
adults in the UK on both physical and financial
health. We also continued other NGO
partnerships across our regions and began a
new partnership with Srujna Charitable Trust
in India to help women affected by poverty to
earn a respectable income.
We aim to further increase United for Financial
Health connections through ongoing
programmes and NGO partnerships across
our regions.
United for Financial Health is part of our wider
community investment. We contribute funding,
products (as gifts in kind) and expertise
(through employee volunteering) to benefit the
communities where we operate. Our
community investment contributions totalled
US$17.6m this year, exceeding our annual goal
of 1% of benchmark profit before tax. This
includes US$1m in cash, product and other
donations contributed to various non-profit
agencies to help refugees displaced by conflict.
Experian employees volunteered 47,000 hours
of their time (in and outside working hours) to
help their communities, including sharing their
expertise to support programmes designed to
improve financial health.
43
Experian plc
Annual Report 2023
Strategic report
Limpa Nome
Being in debt and defaulting is a heavy
burden. People suffer emotionally
from the anxiety that comes from not
meeting repayments. They may suffer
physically too, from working several
jobs or doing without bare necessities,
trying to make ends meet while
paying back the debt and accumulated
penalties. It can be a desperate
situation.
In Brazil, 40% of adults, around 70
million people, are behind on their
debt repayments. Many find
themselves in this situation due to no
fault of their own. For example, a close
relative may have taken on debt under
their name, or they may have lost their
job during the pandemic. Recent high
inflation has also played a part,
pushing many into using credit to
buy food.
On our Serasa Limpa Nome
(
Clean My Name
) platform, people can
renegotiate their debts simply and
quickly, without having to leave home.
They can obtain new repayment plans
from over 500 banks, retailers,
finance companies and others, and
receive up to 99% discount on their
debts. For many people this is an
opportunity to start again; to rebuild
relationships; to see a way to a better
quality of life; to live in peace.
Back to living in peace
I got two 95%
discounts! I'm very
People feel a real sense of relief when they
resolve their debts. Their
and positivity are restored. It is truly
and
It's been so long that I don't even remember the debts,
but we're going to pay everything now. I'm very relieved.
happy
self esteem
life-changing.
grateful.
Francisco Pereira dos Santos Filho
Consumer
Fernando Gambaro
Communications Co-ordinator,
Consumer Services, Serasa Experian,
Brazil
Experian plc
Strategic report
44
We are deeply aware of our responsibility to
treat data – and those it belongs to – with care
and respect. Living up to this responsibility is
fundamental to securing the trust Experian
depends on to exist, grow and create a better
tomorrow.
To do this, we protect the data we hold, use it
fairly and make sure it is as accurate as
possible. We are open about the data we
collect, how we use it and who we share it
with. And we use data to increase financial
inclusion and help people improve their
financial lives.
Our five Global Data Principles embody these
key values (see below) and apply in all
territories where Experian operates. They
guide how we manage and use data, build
products and conduct all aspects of our
business. We are embedding the principles
We have controls in place to check for
compliance and constantly scan for potential
threats, with several layers of protection for
our data assets (see diagram below).
Our Global Security Operations Centre works
around the clock to identify suspicious or
malicious activity, with teams in Malaysia, the
UK and the USA, as well as automated tools and
artificial intelligence. If a threat is identified, our
incident response team steps in to eliminate it
with support from in-house forensic data
specialists and external experts if required.
We interact with law enforcement authorities
and others in our industry to gather intelligence
to help our security teams stay ahead of
evolving cyber threats. We also share our
knowledge to help other businesses and
consumers keep their data safe. Our annual
Data Breach Industry Forecast highlights
emerging threats for 2023 and the coming
decade, including increasing use of artificial
intelligence for cyber attacks and of deepfake
technology for identity theft.
Most data breaches involve some human
interaction, often something as simple as
clicking a link in an email. Our email and web
browsing controls protect against this kind of
malware, and our employee security training
encourages people to think carefully about what
they are clicking on.
into relevant processes throughout the
business and will continue to apply them to
new product ideas through our global
innovation framework, and as our business
evolves through transformations (including the
ongoing move to cloud computing) and
acquisitions.
Security
The loss or inappropriate use of data and
systems could result in material loss of
business, substantial legal liability, regulatory
enforcement actions and significant harm to
our reputation.
Our approach
Security comes first at Experian. We
continually enhance and invest in our security
infrastructure, practices and culture across
the business. We have specialist teams,
state-of-the-art technology and rigorous due
diligence procedures to deal with potential
cyber security threats.
Our security approach has three tiers: applying
tools and processes to prevent threats from
entering our environment; detecting if a threat
enters our environment; and mitigating any
threats by minimising the potential for
information to be extracted from our
environment. Threat-informed defence helps
us shape, assess, prioritise and measure the
effectiveness of our approach.
Treating data with respect
Data is at the heart of our business. We are entrusted with data on
1.5 billion people and 201 million businesses worldwide.
Experian Global Data Principles
Security
Data security is critical. Securing and
protecting data against unauthorised
access, use, disclosure and loss are key
priorities for us.
Accuracy
We will make data as accurate, complete
and relevant as possible for the way we use
it, always in compliance with legal
requirements.
Fairness
We collect and use data fairly and for
legitimate purposes, balancing privacy
expectations with the social and economic
benefits derived from the responsible use
of data for individuals, businesses and
clients.
Transparency
We are open about the types of data we
collect, where we get it, how it is used and
where it is shared. Where appropriate we
provide individuals with access to the data
we collect about them and the ability to
correct, restrict or delete data.
Inclusion
We seek to improve financial health and
inclusion for all through the innovative use
of relevant data to help individuals improve
their financial lives.
Protecting our data
We have a defence-in-depth approach to protecting our critical data assets, which provides
multiple layers of control and protection.
Perimeter scanning
Scanning the perimeter for open access
and scanning applications for regulatory
compliance
Firewall
Blocks unauthorised access while
permitting outward communication
Intrusion Prevention System (IPS)
and prevent vulnerability exploitation
Web Application Firewall (WAF)
Filters, monitors, and blocks HTTP
Examines network traffic flows to detect
traffic to and from web applications
Server protection
Antivirus, host security,
continuous reporting
45
Experian plc
Annual Report 2023
Strategic report
We use a robust identity and access
management programme to control access to
our critical assets. Users with privileged
accounts are subject to strict controls that
include multifactor authentication, password
rotation, session recording and more frequent
access recertification.
Our Development, Security and Operations
(DevSecOps) teams work together to build
security considerations into our products
throughout their lifecycle. We use a range of
processes, including manual penetration
testing, to discover, detect and remediate any
potential security risks at every stage of product
development – from concept to coding, build,
quality assurance and production.
We conduct regular risk assessments and
vulnerability checks, and our operations are
subject to external cyber security audits every
year. Simulated exercises and a global data
breach plan prepare our cyber security teams
and senior leaders to respond rapidly in the
event of a breach.
In the event of a serious breach, we would
disclose information about the incident and
commit to contact any affected data subjects in
a timely way. We do not publicly disclose
vulnerabilities or lapses due to client
sensitivities. To the extent that any relevant
regulator should find fault with our data breach
management or data security practices, they
will publish their findings and any related
sanctions. There were no new findings or
sanctions in FY23.
Security governance
The Chief Information Security Officer has
overall responsibility for Experian’s global
security strategy and reports quarterly to the
Audit Committee. The Global Security Office
(GSO) sets relevant policies and standards.
The Security and Continuity Steering
Committee – which includes the Chief
Executive Officer, Chief Financial Officer, Chief
Operating Officer and Group President Global
Technology – oversees our approach to
keeping data secure and protecting consumer
information. Key metrics on security tools,
compliance and training completion rates are
reported monthly, with regular reviews at the
regional and global levels. The global Steering
Committee meets formally every other month,
or more frequently if required, to review
governance matters regarding security
strategy, policy, risks or threats.
We continually review and adapt our
information security programme, tools,
expertise and processes to respond to evolving
threats and maintain alignment with external
standards. We have a comprehensive Global
Security Policy and controls based on the
internationally recognised ISO 27001 standard
that drives continuous improvement.
Our robust information security programme
builds on industry-recognised procedures. We
seek and receive third-party assurance
through ISO 27001 certifications of key
business areas and systems, as well as other
recognised external accreditations of our
security programmes. For example, we hold a
UK Cyber Essentials Plus Certification and
perform risk assessments of our critical and
external-facing applications annually.
Security, Audit and Risk teams work together
to continually improve our assurance
capabilities and test the effectiveness of our
controls. Our Three Lines of Defence model for
risk management (see page 79) includes
review by Global Internal Audit and oversight
from the Audit Committee. Any potential policy
breaches are thoroughly investigated and we
take disciplinary action where appropriate.
The GSO conducts due diligence to identify any
potential risks before an acquisition, followed
by an in-depth post-acquisition security
assessment that is reviewed by Global Internal
Audit.
When it is necessary to provide third parties
with access to our data and systems, the GSO
ensures we provide access in line with our
information security requirements. We extend
stringent standards on information security to
our suppliers and partners through the terms
of our contracts. All third parties must undergo
a risk assessment and any material security
gaps identified must be remediated before
they begin working with Experian. Existing
third parties are assessed periodically and we
work with them to drive continuous
improvements in their security procedures.
Over the last two years, we have reduced the
number of active suppliers overall. Of the
approximately 7,300 active third parties we
have now, around 900 have been identified as
significant or high risk and all of these have
undergone more in-depth assurance by the
GSO.
Security requirements are tiered based on this
risk assessment, and can include increased
controls for higher-risk third parties. We
monitor compliance through our third-party
risk management framework and third parties
identified as significant or high risk are added
to the GSO’s continuous monitoring
programme, which alerts us to any material
changes to trigger follow-up action if needed.
Our risk profiling and validation processes
include a strong focus on higher-risk third
parties through our Third Party Security
programme, together with a robust Risk and
Control Framework, assurance controls, and
accompanying tools and training for relevant
teams.
Our information security culture
At Experian, information security is everyone’s
responsibility. We set out clear requirements
for employees and business units in our
Security Risk Management and Governance
Policy. We invest significant time and
resources in training and awareness.
Our strong information security culture starts
at the top of the business. Senior leaders are
highly engaged and continually reinforce the
message that security is the personal
responsibility of everyone working with us. All
our employees and any contractors who have
access to our systems must complete
mandatory training on information security
and data protection – when they first start
working with us and annually thereafter. We
track training completion rates weekly and
provide a monthly dashboard to the Security
and Continuity Steering Committee.
Promoting vigilance against phishing attacks
remains a priority. This year, we ran regular
phishing awareness campaigns for every
employee and contractor to test their
response, with difficulty levels adjusted in line
with the threat environment. These metrics
are reported to our Security and Continuity
Steering Committee. If anyone fails a phishing
test, we provide timely feedback and additional
training. We also provided additional
awareness training for employees in roles
most likely to be targeted by phishing attacks.
More than 300 training courses are available
for people across the business to find out more
about keeping information safe across various
web, mobile and desktop platforms,
applications and software. We provide
additional in-depth training for people working
in higher-risk roles, such as product and
software development. More than 60,000
courses were completed this year.
We routinely refresh our training to stay up to
date with evolving risks and circumstances.
We also conduct regular outreach
programmes on a variety of information
security topics to make sure people are aware
of emerging threats. These include simulations
of security incidents.
>
300
training courses are available
for people across the business
to find out more about keeping
information safe across various
web, mobile and desktop
platforms
>
60,000
courses were completed this
year
Sustainable business
continued
Experian plc
Strategic report
46
Accuracy
Accurate credit reports enable lenders to give
people fairer access to credit and essential
services to improve their lives (see page 42).
Any inaccuracies in credit reports – and the
data they are built on – can cause problems for
consumers, and potentially deny them fair
access to credit and services.
We understand how important this issue is for
consumers, and accuracy is one of our Global
Data Principles that guide our approach
wherever we operate. Data accuracy principles
are also being written into data protection
regulations in many countries.
We are committed to making data as accurate,
complete and relevant as possible for the way
it is used, always in compliance with legal
requirements. We constantly strive to improve
the accuracy of our data in a competitive
market to ensure our clients can always rely
on it to make appropriate decisions.
We have strict processes for data accuracy
– from sourcing accurate data in the first place
to monitoring and improving accuracy over
time, and resolving reported inaccuracies or
information queried by consumers. Our focus
is on the timeliness, accuracy and
completeness of the data we hold and the
reports we provide to our clients.
Sourcing accurate data
All our data comes from reputable sources
and, as part of our due diligence processes
before we onboard new sources of data, our
quality control procedures help us identify and
weed out inaccurate or out-of-date information
before we add it to our databases.
We work with data providers to review and
continuously improve the quality of the
information we receive. To do this, we regularly
review and report back on quality to our data
providers so we can drive continuous
improvement. We also offer a comprehensive
suite of software and analytics tools to help
them check data before they submit it to us.
We monitor how data providers deal with
queries about data and how they remediate
them to improve accuracy. If data providers
are unwilling to implement improvements to
meet our standards, we will no longer source
data from them.
Monitoring and improving data accuracy
Once we have acquired data, we frequently
update and periodically audit the information in
our databases to ensure it is as current as
possible. We apply further quality assurance
techniques, including screening for logical
inconsistencies and applying data-matching
algorithms, before providing data to our
clients. This ensures we provide clients with
information that represents consumers and
businesses as accurately and fairly as
possible.
We also monitor queries received directly from
consumers to identify trends relating to data
quality, enabling us to rectify many accuracy
issues quickly at source. We make it a priority
to rapidly resolve any conflicts or errors that
are likely to have a material impact on a
consumer’s credit score.
In the UK, we have added more than 33 million
net new records to our consumer bureau in the
last year alone, constantly reviewing the
market and working with new lenders and
sectors to ensure their customers are
represented appropriately within the bureau.
Our Data Office leads our efforts to achieve
world-class data governance through a strong
focus on data quality, acquisition, transparency
and privacy across both our credit and
marketing services businesses. As part of this
approach, we continue to invest in technology
to automate and monitor the way we improve
our data.
In the USA, we manage the accuracy of data
from around 13,000 providers that have data
on file. Every month, we receive around 36,000
submissions from data providers, and update
around 1.2 billion records – 98% within 24
hours. We are innovating to continuously
improve our data integrity and focus on
targeted changes that drive even better
accuracy for US consumers.
Empowering consumers to correct their data
We empower people to correct, restrict and
delete data, where appropriate. We provide
consumers with various methods to view their
credit information and request corrections, if
needed. In the UK and the USA, agents in our
support centres are trained to help consumers
with questions, concerns or disputes about
information in their credit file or other personal
data we hold that might be processed for other
purposes, such as the provision of marketing
services to our clients. Our websites in the UK
and the USA make it easy for people to raise a
query about credit information and get it
corrected quickly, and in Brazil we offer a form
to dispute data by post.
We pass on consumer disputes to the data
provider to evaluate, resolve and supply
corrected data where errors are confirmed.
Each time a data provider responds to a
request for verification, they must also confirm
that the entire account is accurate. In the USA,
if the data provider fails to respond within 30
days, we will delete the item. Similarly in the
UK, if the data provider fails to respond within
28 days, the data is temporarily suppressed on
the consumer’s credit report until a response
is received. Once a dispute is resolved, we
update data as required and notify the
consumer of the result.
Data accuracy is particularly relevant for the
transgender and non-binary community with
regard to name changes. Information about
gender, sex, age, race, ethnicity, religion or
sexual orientation is not included in credit
reports or scores. However, when someone
transitions gender, and changes their name,
their credit and financial history may still be
tied to their birth name (or ‘deadname’), which
can unintentionally ‘out’ the consumer or force
them to establish a new credit history. In the
UK and the USA, we have processes that
enable people who identify as transgender or
non-binary to affirm their identity, update their
name and suppress their deadname so it does
not appear on their Experian credit report.
Many of our products also empower
consumers and businesses to check for any
inaccuracies in their financial profiles and take
steps to protect their data, including choosing
to block access to their credit report to help
reduce the risk of identity theft and fraud. This
year, we launched CreditLock in the UK,
enabling CreditExpert and IdentityPlus
customers to lock or unlock their Experian
credit report at the touch of a button. The new
feature also alerts customers in real time if
any new credit searches are made in their
name and if it has stopped any fraudulent
applications on their behalf. Premium
subscribers in the USA can also lock and
unlock their credit reports quickly and easily
with the CreditLock feature, and our credit
score app in Brazil includes a lock/unlock
feature that enables premium subscribers to
block and unblock their credit score from any
third party that tries to consult their data.
Accompanying information explains how this
feature can help to reduce the risk of fraud, as
well as educating consumers about different
kinds of fraud and the importance of protecting
their credit score.
Scan me
to find out more about
CreditLock
CreditLock
This year, we launched CreditLock in the UK,
enabling CreditExpert and IdentityPlus
customers to lock or unlock their Experian
Credit Report at the touch of a button.
47
Experian plc
Annual Report 2023
Strategic report
Fairness
We are committed to collecting and using data
fairly and for legitimate purposes and
complying with regulations on data lifecycle
and retention in the markets in which we
operate. We carefully balance privacy
expectations with the social and economic
benefits derived from the responsible use of
data for individuals, businesses and clients.
Our privacy policies vary in each country or
region to comply with local regulatory
requirements. Underlying these policies is our
commitment to provide consumers with notice,
choice and education about the use of personal
information. Educated consumers are better
equipped to be effective, successful
participants in a world that increasingly relies
on the exchange of information to deliver
relevant products and services efficiently.
Lenders need access to accurate information
about people’s financial profiles from Experian
or other credit bureaux. Such information is
integral to an efficient and competitive credit
ecosystem that provides innovative products
which enable consumers to get the most out of
their data, contributes to economic growth and
supports a stable consumer banking system.
Our Marketing Services business also gathers,
analyses, combines and processes data to help
organisations better understand consumers so
they can offer them relevant products and
services, and communicate more effectively
and at the right time.
We evaluate every product and service to
ensure we strike the right balance between
consumers’ privacy expectations and the
economic benefit to consumers and clients, as
well as considering societal benefits. Our
comprehensive data protection programme
details the steps we take to mitigate data
protection risks, and what we expect from our
employees.
We are committed to obtaining, processing,
using and retaining data compliantly and
responsibly. We strive to only ever share data
with authorised and trusted organisations.
When we do so, we follow strict guidelines and
comply with all relevant laws.
We take fair and appropriate measures when it
comes to data retention, adhering to national,
state and federal regulations in locations
where we operate. We have strict processes to
appropriately manage the lifecycle of data we
hold and to allow appropriate access to, and
deletion and correction of, data when
requested by the individual data subjects in
each of our markets. We communicate details
on retention and privacy through our websites.
We also embed the concept of privacy by
design into the data journey to ensure that we
are using only the minimum amount of
personal data needed for a specific purpose.
In many parts of the world, regulations on data
privacy set clear requirements on the way data
is collected and used, and how consent is
gained from consumers. We regularly review
our data processes to ensure compliance with
regulations, such as the Data Protection Act
2018 in the UK, the General Data Protection
Regulation (GDPR) in the UK and European
Union, the California Consumer Privacy Act
(CCPA) and other state laws in the USA, and the
Brazil General Data Protection Law (LGPD).
Data offers huge potential to support jobs and
prosperity. We need a regulatory framework
that nurtures and supports use of data to
encourage growth, while protecting
consumers’ privacy. We respond to
government consultations and engage with
regulators and policy-makers as privacy
regulations and guidance evolve, for example
on the implications for privacy in relation to
use of artificial intelligence and machine
learning. Many regional and national
regulations on data privacy share common
principles, and we advocate for interoperability
to support global commerce.
Our Group Operating Committee and senior
leaders receive regular briefings to keep them
apprised of privacy developments around the
world, and we update our policies and
practices accordingly.
In the UK, in February 2023, Experian’s appeal
to the First Tier Tribunal against the
Information Commissioner's Office (ICO)
Enforcement Notice from 2018 was
substantially successful. The Tribunal set aside
the eight requirements from the ICO’s
Enforcement Notice. It issued a substitute
enforcement notice which contained the
requirement that if Experian continues to use
data from certain public data sources, it must
notify those whose data has been received
only from those public data sources of its data
processing.
In line with its public statements, the ICO is
appealing the decision and we expect the
hearing of that appeal to take place in the latter
part of 2023. The substitute enforcement
notice is stayed pending the outcome of the
appeal.
Transparency
We strive to be open and transparent about the
types of data we collect from consumers and
third parties, where we get it, how it is used
and where it is shared. Where appropriate, we
provide individuals with access to the data we
collect about them and give them the ability to
correct, restrict and delete data.
Data transparency not only empowers
consumers, it also benefits our business. For
example, our marketing services are more
effective for our clients when more people
understand their ability to set their marketing
preferences, as this means fewer people
receive unwanted marketing to which they
would not be receptive.
In the UK, the privacy section of our website
provides privacy policies for different parts of
the business, and our Marketing Services
Consumer Information Portal (MSCIP) explains
data rights and sets out the various ways we
Scan me
to see the Marketing
Services Consumer
Information Portal
Responsible marketing
We're committed to putting your interests at
the heart of everything we do.
The safeguards we have in place protect your
personal data so you experience positive
outcomes because of our activities.
Sustainable business
continued
Experian plc
Strategic report
48
use personal and anonymised data. The
content on these websites is designed to be
clear and easy for non-experts, and the MSCIP
includes a series of engaging videos on topics
such as how we obtain data and how people
can benefit from sharing their data. Individuals
can use the MSCIP to find out if they are on our
marketing file and understand what data we
hold about them, where this data comes from
and how it is used. It includes a prominent
feature enabling people to easily opt out of
targeted marketing if they choose.
To enhance transparency about the marketing
profiles we build, the MSCIP allows consumers
to view our Mosaic classification for any valid
UK postcode. Through this feature, consumers
can get a flavour of how marketers may view
them, or people with similar profiles, when
using our Mosaic segmentation to improve the
relevance of their marketing messages. The
results use simple icons to show key attributes
– such as property, transport, lifestyle and
holidays – in a way that’s easy to understand at
a glance. In a survey of 378 nationally
representative adults, 92% agreed the
information on our ‘how we use your data’
page was easy to understand.
In Brazil, our privacy terms page is designed to
be user-friendly, translating the consumer
contract into simple, accessible language and
layout before the user logs in. We also provide
consumers with illustrations of what their
positive data means, to help them understand
how it affects their overall financial health.
In the USA, we set out our privacy policies for
specific products and services in the privacy
section of our website. Consumers can access
the credit information that Experian holds on
them in various ways, including by signing up
for a free or paid membership through the
Reports and Scores section of our website.
They will then be presented with a report
showing the data Experian holds on them and
how to dispute this information online if
necessary. Our credit reports in North America
also include a Credit Report Insights section
that features infographics, colour-coding and
easy-to-interpret explanations of the factors
that may be helping or hurting a consumer’s
credit status and score. We have applied the
standards of individual state privacy laws
more broadly so all US residents can also
manage their personal data permissions
through the Central Consumer Consent (CP3A)
platform.
We work with financial institutions to enhance
transparency with consumers. In the UK, when
a consumer applies for credit, the lender will
direct them to an industry-standard
information notice – the Credit Agency
Information Notice (CRAIN) – which presents
clear and consistent information explaining
how credit reference agencies use and share
personal information. As with the MSCIP, the
CRAIN uses clear language to make it
accessible to consumers and is divided into
easy-to-access sections. It also references
other privacy and transparency notices that
may be relevant to the consumer.
In the USA, financial institutions provide
adverse action notices when an applicant is
denied credit or employment based on
information included on their consumer credit
report. This notice includes a brief description
of the data used for the decision and a contact
for the credit reference agencies that provided
the data, as well as triggering the right of the
consumer to review their credit report free of
charge.
Inclusion
We enhance financial inclusion by using data to
create insights that help lenders offer fairer
access to credit to more people.
Our aim is to help more people get better
access to credit by sharing relevant data with
lending organisations, including adding
alternative sources of data, such as positive
data about on-time payments of utility bills and
subscription services.
Products such as Experian Boost and Experian
Go enable individuals to directly contribute
such data to their profiles to help them
enhance their credit score or establish a credit
profile for the first time (see page 42). This
year, we added the option to contribute rent
payments, to enable millions of renters in the
USA to instantly improve their credit score.
In the UK, we have contributed to a reduction in
the number of credit invisibles and thin files
from nine million to fewer than five million
over the last six years by introducing additional
data sources into our products and improving
data accuracy.
A new social innovation product, to be piloted
in the coming year, could help millions more
UK credit invisibles access mainstream
financial services by building their credit files
in as little as three months. Another solution
being developed through our Social Innovation
programme aims to enhance financial
inclusion for more than one million Venezuelan
migrants living in Colombia by making it
possible for organisations such as financial
and educational institutions to validate their
identity.
We work with partners around the world on
products and programmes that reinforce our
commitment to financial inclusion for all, and
our Chief Operating Officer, Craig Boundy, sits
on the national working group of the US Office
of the Comptroller of the Currency’s
Roundtable for Economic Access and Change
(REACh).
Our Inclusion Forward programme, initially
launched in the USA, aims to help our clients
further accelerate financial inclusion in the
communities they serve, and create better
outcomes for underserved consumers and
small businesses by unlocking barriers to
financial health. It helps clients: understand
geographic areas and segments with the
largest opportunities for inclusion; benchmark
and track progress; incorporate expanded
FCRA-regulated data sources to reach more
underserved consumers and small business
owners; and develop and educate vulnerable
populations, offering additional tools to
support their credit journey.
a
Read our Diversity, Equity and Inclusion
Report for more on our Inclusion Forward
programme and inclusive products and
partnerships for our people, our clients and
consumers, and communities.
a
Read our Improving Financial Health Report
for more on our use of data to improve
financial inclusion and financial health more
broadly.
Scan me
to view our Inclusion
Forward initiative
Inclusion Forward
– Experian's Empowering
Opportunities™ initiative is our commitment to
providing data, resources and support to
businesses and financial institutions in helping
consumers improve their financial wellbeing.
49
Experian plc
Annual Report 2023
Strategic report
I lived in a mobile home, worked from paycheck to
paycheck… I now couldn’t be happier.
that the app is telling me what I need to know…
and that Experian is watching out for me.
Experian plc
Strategic report
50
Experian Go
Experian Go addresses one of the
major obstacles to financial inclusion
by providing a unique way to establish
a financial identity. Powered by
advanced data science, a credit report
can be created for users in just
minutes to establish their financial
identity, and start to build and grow
their credit report.
For the unbanked in the USA, this
unlocks the door to the financial
system, provides new opportunities
and helps them save money through
more affordable credit. It means they
can start their financial journey in the
direction that is right for them.
Financial freedom for the unbanked:
a credit report in just minutes
Experian Go helps people start their
It's like having your own personal credit guide.
financial journey.
I am confident
Michele Diederich
Senior Director, Consumer Services,
Experian North America
Alison L.
We have an ambition to be one of the best
places to work in the world and we have
continued to score highly in external
recognition this year (see Awards on page 52).
We are making progress across the Group
through programmes in five strategic
focus areas:
Inspiring and supporting our people
Our people are central to our purpose. Our aim is to be a market-leading
destination for talent, underpinned by a high-performing and inclusive culture
where our people feel valued and able to do their best work in support of our
purpose and our ambitious plans for growth.
Scan me
to access our DEI report
1. Creating a culture that puts
people first
Create a 'wow' employee experience that
sets us apart
2. Growing world-beating leaders
Grow the next generation of leaders with
strong product, technology and customer
orientation
3. Focusing on tech talent
Keep in tune with current and future tech
skills, specifically focusing on attracting
and retaining product design and product
building capabilities
4. Preparing our organisation for
growth
Play a leading role in defining the
organisation we need so that we are
prepared for global opportunities and
growth
5. Supporting colleagues with their
career development
Enable everyone in Experian to develop
and progress their careers
1. Creating a culture that puts
people first
The world of work is changing rapidly, and
we believe our people and culture are key
differentiators for us. Our business offers an
exciting future and our strong purpose – our
belief in doing the right thing for our people
and the communities we serve – helps us
attract people who want to work somewhere
they feel they can make a difference.
We have continued to evolve our employer
brand and employee value proposition.
This year, we have made progress towards
being recognised as a leading employer, and
enhanced perceptions of us in the market as
an innovative, technology organisation. As a
result, we have seen our seventh consecutive
year of improvements in our Glassdoor score,
now 4.4 out of 5, and we are now in the top
quartile of companies globally listed in the
Link Humans Employer Brand Index.
Offering flexible ways of working
The COVID-19 pandemic accelerated the
transition to new ways of working. In FY22 our
Group-wide Future of Work programme
considered the role of our offices as well as the
technology investments needed to enable
more hybrid working. Following this, we
created a variety of options – Hub, Hybrid,
Home and Roam – to give our people more
choice in the way they work. In our FY23
annual employee survey, over 90% of our
people said they value our approach to flexible
working, and employee engagement was up
four points from the previous year. At the same
time, we have maintained productivity levels
and innovation measures across the
organisation.
Embracing diversity, equity and inclusion
Diversity, equity and inclusion (DEI) is essential
to our purpose of creating a better tomorrow,
together, by making positive changes in the
world and supporting efforts to close the
financial wealth gap of underserved
communities (see page 49). We support and
encourage expressions of diversity, including
thought, style, sexual orientation, gender
identity or expression, race, ethnicity, disability,
culture and experience.
Our Global Chief DEI Officer leads our DEI
strategy, which focuses on our people, our
clients, consumers and communities. Regional
CEOs and business unit leaders are accountable
for implementing the accompanying Diversity
Action Plans and monitor progress at quarterly
business reviews. DEI is also part of our wider
sustainable business strategy and ESG agenda,
overseen by our executive-level ESG Steering
Committee (see page 39). Inclusive leadership is
a key element of our new Leadership Exchange
development programme (see page 53).
Our DEI Report sets out how we are putting our
DEI strategy into practice across five key areas
– gender, mental health, disability, LGBTQ+ and
ethnicity – each sponsored by a member of our
Group Operating Committee.
Glassdoor score of 4.4 (out of 5)
Seventh consecutive year of improvement
51
Experian plc
Annual Report 2023
Strategic report
The DEI highlights for our people
in FY23 include:
a
Investing in technologies to improve
accessibility, and launching a
Barrier-Free Experian campaign to make
progress towards an inclusive and
barrier-free workplace, and solutions for
our people, customers and consumers
with visible or non-visible disabilities.
a
Publishing a Global Approach to Mental
Health and Wellbeing, supported by a
new Global Wellbeing Hub, to showcase
our commitment to providing a
psychologically safe and healthy
environment where everyone has good
mental wellbeing. We have now trained
over 400 Mental Health First Aiders, 2%
of our employees and double our 1%
target.
a
Continuing to support recruitment and
development of women, to move towards
our gender-diversity targets for FY24
(see the table to the right). In FY23,
representation of women increased to
34% of our senior leaders. Women
account for 36% of our mid-level leaders
and 44% of our total workforce. In
addition, we continued our focus on
increasing the representation of Black
and Hispanic/Latino employees in our US
business, which increased from 16.9% in
FY22 to 17.5% in FY23. We will continue
to drive our focus on reinforcing our
culture of inclusion and belonging within
our Asian representation, which
currently makes up 20.4% of our
employee population in the USA.
a
Expanding benefits in some regions,
such as enhanced parental leave in
North America and Spanish Latin
America, and menopause healthcare in
the UK and Ireland, to become more
inclusive and remove barriers for our
people.
a
Introducing a global voluntary
self-identification programme to help us
better understand our people, so we can
make more-informed decisions on
inclusivity and representation. The Count
Me In programme invites our people, if
they feel comfortable doing so, to
disclose some of the things that make up
their identity, like gender and ethnicity.
Employee resource groups (ERGs) continued
to play an important role in our DEI efforts this
year and supported global campaigns, such
as our annual Your Mind Matters week to raise
awareness of mental health. They also ran
regional activities to celebrate events,
including International Women’s Day,
International Men’s Day, International Day of
Persons with Disabilities, Pride Month, Black
History Month and Hispanic History Month.
We are working towards a stronger global
structure for the ERGs. In FY23, we created a
global portal to showcase all our ERGs and
associated events, and enable employees to
join an ERG at the click of a button. The portal
provides access to a comprehensive resource
library complete with event replays, podcasts,
books and articles, and it increases awareness
of product initiatives employees can get
involved in to support financial inclusion.
In FY24, we aim to significantly increase
membership of our ERGs, connect them
with development opportunities and enable
volunteering to support specific communities.
We will also invite ERG feedback on new
products and services before taking them
to market.
Engaging our people
We run an annual global survey with Great
Place to Work (GPTW) to understand employee
sentiment and identify opportunities to
maximise employee experience. In FY23,
70% of our employees participated in our
second annual GPTW survey, up from 58% the
previous year, demonstrating that our people
Gender diversity metrics and targets
Awards
Representation of women
FY21
Actual
FY22
Actual
FY23
Actual
FY24
Targets
Senior Leaders
1
32%
33%
34%
40%
Mid-Level Leaders
35%
36%
36%
42%
Total workforce
1
44%
44%
44%
47%
Directors
2
36%
36%
45%
1
These percentages are based on a total of 22,000 employees globally, of whom 1,068 are senior leaders.
2
Of 11 directors. Please refer to page 94 for more details.
Find out more:
For a full list of awards, please see
our website
are keen to let us know their views. We
saw promising improvements, and overall
engagement increased by four points to 82%.
We also carry out regular pulse surveys to
look at and measure leadership effectiveness,
flexibility, culture and simplicity, to help us
make ongoing improvements for our people.
Taking part in the GPTW survey is a key part
of our People strategy, as it helps to position
us internally and externally as a top tech
employer based on real feedback from our
people. Our survey scores and workplace
practices mean we are now certified as a
Great Place to Work in 22 countries. In addition,
Experian was again included in the Fortune
100 Best Places to Work in 2022 in the USA,
UK's Best Workplaces 2023 and Best
Companies to Work for in IT 2023 in Brazil.
We have also received further external
recognition for specific aspects of our people
agenda, including our commitment to inclusion
of women and LGBTQ+ colleagues, disability
equality and mental health (see above and
our DEI Report for more).
We communicate regularly with our people
through townhalls, listening forums and
colleague events. Horizon, our market-leading
employee communications platform, remains
popular with employees, with 97% registered
and 88% regularly active on the platform.
We also encourage our people to contribute
their ideas through our global hackathons.
Find out more:
Diversity, Equity and Inclusion Report
Sustainable business
continued
Experian plc
Strategic report
52
Rewarding and recognising our people
We continue to celebrate our Experian Way
behaviours (see above), resulting in us handing
out over 32,000 employee-nominated
recognition awards in FY23.
2. Growing world-beating leaders
We have created a new global standard for
leadership across the business this year,
defining the characteristics of great leadership
to help develop our leaders across the Group.
This year, we launched the Leadership
Exchange – an online portal with access to
on-demand development and support. Content
was co-created with our leaders and supported
by content from external providers such as
Harvard Mentor Manager and Bravely Coaching.
We also refreshed our Experian Business
Network leadership programme and launched
a new CEO Forum which offers development
support and access to top leaders within
Experian.
In the FY23 annual GPTW survey, our
leadership-effectiveness score increased two
points to 82%. In the February 2023 Pulse
survey, this score further increased to 87%,
which places us above the World’s Best
Workplaces Top 25 benchmark for the first time.
3. Focusing on tech talent
Attracting, retaining and developing the best
tech talent is essential for us to realise our
ambition of becoming a world-class product
organisation.
With skills gaps in technical talent being felt
all around the world, we have had to look to
alternative avenues to grow and develop
these skills.
The Experian Way
The Experian Way represents our values, and the behaviour we expect from
all our employees in their daily activities.
Delight
customers
Innovate
to grow
Co
llaborat
e
to win
Sa
feguar
d
our future
Value
each other
We have continued to expand our early-in-
careers programmes to develop young,
diverse talent through the organisation.
For example, our Transforme-se (transform
yourself) programme in Brazil provides
young people and under-represented groups,
such as women, people from low economic
backgrounds and people with disabilities, with
technical skills training and apprenticeships.
To date, we received c.8,000 applications and
have awarded 280 scholarships.
In the UK and Ireland, we doubled the number
of graduates and apprentices in our 2022
cohort to over 100, and have strengthened
our relationships with local schools and
universities to support students interested
in STEM subjects.
For FY23, we continued to use
SmartRecruiters global applicant-tracking
system. This supported 949,000 global
applications and helped us facilitate 5,575
hires. Our top three sourcing channels were;
LinkedIn (67%), Glassdoor (14%), and the
Experian global careers site (10%). These
channels generated a significant amount of
reach and engagement, building our brand
attractiveness and awareness. Glassdoor
had an impressive 6,900,000 interactions with
our Experian Glassdoor profile pages and
advertised jobs. Our Experian global careers
site had 292,000 unique visitors during FY23.
We have a global talent pool within Experian
for critical technology skills, and we have been
focusing on creating a world-class digital
curriculum for tech talent through
partnerships with Pluralsight and DataCamp.
We have seen strong uptake rates of these
learning resources, and we will continue to
develop the offering and extend it to all
colleagues.
4. Preparing our organisation
for growth
We are taking a stronger approach to our
workforce planning, so we are clearer on what
skills we need, where we need them, how
many people we need, and what timeframe we
need these skills in. This will enable us to plan
a strategy to ‘buy, build, borrow or bot’ the
skills required to meet our business objectives.
We also aim to close key skills gaps by further
developing our existing employees. Our global
frameworks help us identify the skillsets we
have in the organisation, to make sure the right
people are working on our most critical
projects at any given time, as well as providing
employees with a way to view and compare
potential roles, identify their own skills gaps,
and access personalised learning paths.
5. Supporting colleagues with their
career development
With top talent increasingly looking for career
development opportunities within their
organisations, we have an opportunity to set
ourselves apart by becoming somewhere
people come to grow.
We held our second Global Careers Week in
January 2023, which was attended by 13,000
employees. This year’s strapline was 'Ignite
Your Career' which brought to life elements
that are critical for career development, such
as knowing yourself, planning your journey,
learning, and upskilling to deliver excellence.
Throughout the week, the sessions reinforced
our commitment to developing our people, our
investment in our engineering talent and how
colleagues can take advantage of the learning
resources that are available to everyone via
our internal Career Hub (a world-class digital
curriculum for our people and a one-stop shop
for career development needs). During the
week, the Leadership Exchange portal was
launched to all people managers and senior
leaders, and more than 1,000 leaders joined a
fireside chat with our CEO, Brian Cassin, about
making leadership our competitive advantage.
Our focus on improving employability is
already bringing positive results. In FY23
27.7% of our people moved jobs within
Experian, up from 18.9% last year, and we want
to grow this further. In this year’s GPTW survey,
74% of participating employees agreed with
the statement that ‘I am offered training or
development to further myself professionally’
– up six points from the previous year overall,
and for tech talent specifically this score
increased by nine points to 73%.
Find out more:
See our website for The Experian Way in full
Transforme-se
In Brazil, our Transforme-se programme
provides women, people from low economic
backgrounds and people with disabilities, with
technical skills training and apprenticeships.
53
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Working with integrity
Working with integrity is one of our core values. Our Global Code of Conduct,
available in several languages, sets out clear guidance to help everyone at
Experian make the right decisions. We regularly review it to determine if
updates are required and we will publish our next update in the coming year.
The Global Code of Conduct is supported by
detailed policies on specific topics such as
anti-corruption, conflicts of interest, gifts and
hospitality, fraud management, complaint
management, fair treatment of vulnerable
consumers, product development and
marketing, whistleblowing and tax.
We are committed to creating and maintaining
a robust, effective and appropriate control
environment to recognise where opportunities
for financial crime exist and mitigate the
associated risk. We establish and maintain
processes and procedures to monitor, detect
and prevent acts of financial crime against
Experian by third parties or employees, or
through the unlawful use of or access to our
products, services or data. If any employees
are found to have committed any financial
crime, we will take appropriate disciplinary
and legal action against those involved.
Our commitment to doing business
responsibly includes our approach to tax
affairs, as set out in our Tax Policy, which is
included in our annual Tax Report. The report
explains how we manage taxes and how tax
fits into our broader ESG agenda, provides
information on our tax governance and details
our regional corporate tax contributions.
sponsorships, charitable contributions,
lobbying or political donations ethically and in
compliance with all relevant laws.
Suppliers are contractually obliged to ensure
their employees, agents and subcontractors do
not pay or receive improper bribes, facilitation
payments, gratuities or kickbacks. If we
identify any suppliers as high risk for bribery
or corruption, we refer them to the Compliance
team for further due diligence, including an
assessment of corruption, regulatory and
reputational risks.
We conduct periodic assessments to check for
and mitigate corruption risks as part of our
Compliance Management Programme. We
also follow rigorous due diligence procedures
to identify any risk of improper payments
during mergers and acquisitions, or when
we enter into joint ventures.
Our Finance and Global Sourcing teams have
training and controls to detect and stop
improper payments, with support from our
Global Internal Audit team. If we identify any
concerns, we promptly investigate them and
take appropriate action.
Training and compliance
We strive to create a culture of integrity that
empowers our people to make the right
choices. Our Global Code of Conduct clearly
states that everyone at Experian is accountable
for managing operational risk across our
business effectively to safeguard our future.
All employees (including part-time employees
and contractors) have to confirm they have read
and understood our Global Code of Conduct
when they first join Experian. They are then
required to acknowledge their understanding of,
and confirm their commitment to, the Global
Code of Conduct every year, and we make sure
they do so through our performance review
process. We also expect managers to be role
models for ethical behaviour.
Any breaches of our Global Code of Conduct
or associated policies could undermine our
reputation and the trust of our stakeholders.
Our Three Lines of Defence risk management
model reinforces our culture of compliance.
We encourage people to report any suspected
policy breach or unethical activity without fear
of reprisal. Anyone who knows about a
potential violation, and does not report it,
could face disciplinary action.
We ask employees to talk to their manager in
the first instance if they have concerns. They
can also report any concerns, anonymously if
they choose, through our externally-facilitated
24-hour Confidential Helpline. The Helpline is
open to both employees and third parties, and
provides support in local languages.
We take any allegations of ethical breaches
very seriously. All reported concerns are
investigated promptly by relevant functions,
such as Human Resources, our Global Security
Office or Global Fraud Investigations, to identify
root causes and take appropriate corrective
action. This year, 71 concerns were reported.
The majority of these (94%) concerned matters
related to human resources.
Respecting human rights
We are committed to upholding the United
Nations Universal Declaration of Human Rights
(UDHR), the United Nations Guiding Principles
on Business and Human Rights (UNGP), the
International Labour Organization (ILO)
Standards and the Organisation for Economic
Co-operation and Development (OECD)
Guidelines for Multinational Enterprises.
Our commitment to respecting and promoting
human rights is reflected in our Code of
Conduct and associated compliance policies –
which everyone at Experian must confirm their
commitment to every year. These policies
make clear that we do not tolerate any
infringement of human rights in our business
or our supply chain.
We have identified the following salient human
rights for Experian: healthy and safe working
conditions; workplace security; freedom of
association; diversity, equity and inclusion;
absence of modern slavery and forced labour;
access to grievance mechanisms; data
protection and privacy; environment and
carbon emissions. Our statement on salient
human rights sets out our approach to each of
these. We recognise that other human rights
issues may become relevant to Experian in the
future and we review our salient issues
regularly, based on best practice.
We are committed to treating all our people
fairly and with respect. Experian is an
accredited Living Wage employer in the UK,
going beyond the legal minimum wage to pay
employees the amount the Living Wage
Foundation has calculated to support
Scan me
To view our 2023 Tax Report
Scan me
To view our policies and
statements, including our
Code of Conduct
Anti-bribery and corruption
We take a zero-tolerance approach to bribery
and corruption, reinforced by our Global Code
of Conduct and Global Anti-Corruption
Framework. We prohibit anyone acting on
behalf of Experian – including employees, third
parties and suppliers – from offering or
accepting a bribe, or making a facilitation
payment to officials, in connection with our
business.
Our Global Gifts and Hospitality Policy sets out
strict ethical standards relating to gifts,
entertainment, hospitality, sponsorship, travel
expenses and donations. We also have
controls to ensure we conduct any
Experian plc
Strategic report
54
a reasonable living. As set out in our updated
Global Code of Conduct, we support our
employees’ right to affiliate or not affiliate
with legally sanctioned organisations or
associations without unlawful interference.
DEI remains a key focus for Experian, not only
in relation to our people (see pages 51-52), but
for our clients, consumers and communities.
Our focus on improving financial health for all
supports efforts to close the financial wealth
gap of underserved communities (see page
42). We are a signatory to the UN Women’s
Empowerment Principles and our commitment
to DEI received further recognition this year.
For example, we were named in Equileap’s Top
100 Globally for Gender Equality. Experian
North America achieved a perfect score in the
Disability Equality Index and retained its rating
in the Human Rights Campaign Foundation’s
Corporate Equality Index as one of the best
places to work for LGBTQ+ employees. We also
received a Silver Award from Stonewall for our
commitment to inclusion of LGBTQ+ people in
the workplace in the UK and Ireland. Our Global
DEI Report provides more information on our
strategy and performance in this area.
Our Supplier Code of Conduct sets out clear
standards on human rights, and we include
clauses in our contracts that oblige suppliers
to protect workers’ rights and freedoms. We
monitor compliance through our third-party
risk management framework. We also expect
suppliers to set similar requirements for their
own suppliers and subcontractors, to extend
high standards throughout the supply chain.
Tackling modern slavery
We recognise that modern slavery can occur
in any sector, anywhere in the world. We are
doing all we can to eliminate the practice.
Experian is a founding member of the
Slave-Free Alliance (SFA), which brings
together businesses working towards a
slave-free world.
Following implementation of a three-year
improvement plan based on an initial
comprehensive assessment by the SFA, we
have completed a second assessment with the
SFA this year to identify further opportunities
to improve our approach to tackling modern
slavery risks in our business and supply chain.
A quarterly steering group, headed by our
Group Chief Procurement Officer, reviews
and tracks progress.
We undertake an annual assessment of
high-risk suppliers to ensure they have
policies and procedures in place to minimise
the risk of modern slavery. Our process
involves supplier segmentation, self-
assessment questionnaires, interviews and,
where appropriate, on-site visits. This year,
we followed up with a supplier to get further
evidence related to procedures for visa
applications for overseas nationals and
involved our own visa experts to support our
engagement. Our Modern Slavery Statement
provides further information on our
commitment, policies and actions to tackle
modern slavery risks in our business and
supply chain.
Our partnership with Hope for Justice
supported 544 survivors of modern slavery,
since October 2020, through advocacy and
advice services – including helping them prove
their identity, access credit reports and resolve
fraudulent debts racked up in their name. An
additional 13,465 people at risk of exploitation
have also been engaged through community
outreach and training to equip them with the
tools and skills to identify and report modern
slavery.
Working with suppliers
Our Supplier Code of Conduct represents the
minimum ethical, labour, human rights and
environmental standards that all our suppliers
must meet. As part of their contracts with us,
all suppliers must confirm they accept our
standards or have their own equivalent
standards in place.
ESG criteria are integrated in our supplier
selection process alongside commercial
considerations, including requirements for
satisfactory governance of areas such as
bribery, corruption and modern slavery that
are built into our review processes. We also
engage with suppliers on climate to help us
measure and progress towards our Scope 3
emissions reduction target (see page 60).
We conduct a risk assessment of all the third
parties we work with, including suppliers and
indirect clients. Overseen by our Third Party
Risk Management team, we assess risks
related to data security and privacy, business
continuity, compliance and reputation
(including bribery and corruption). We will not
work with – and routinely reject – third parties
that do not uphold our standards on critical
issues, such as data security.
Of the thousands of third parties we work with,
most fall into the minor or moderate risk
category in our initial risk assessment. Those
we consider higher risk – based on factors
such as the type of product or service they
provide and the type of data they have access
to – are subject to more in-depth assessments,
oversight and controls.
As our first line of defence, the business
function that has the relationship with the third
party is responsible for identifying, tracking
and resolving any issues. We test our controls
periodically, logging and resolving any issues
identified through our centralised global
governance, risk and compliance system.
We strive to support diverse suppliers through
our strategic sourcing process, which is
designed to offer a level playing field for all
third parties. In the USA, we work with
organisations such as Disability:IN, the
National Minority Supplier Development
Council, the National LGBT Chamber of
Commerce, the National Veteran-Owned
Business Association, the US Small Business
Association and the Women’s Business
Enterprise National Council. These
organisations support our year-on-year
growth of registered diverse and small
business supplier relationships. This year, we
launched a new supplier diversity website that
informs potential suppliers in North America of
our approach to supplier diversity and invites
diverse suppliers to register with us.
Experian North America
achieved a perfect score in
the Disability Equality Index
and retained its rating in the
Human Rights Campaign
Foundation’s Corporate
Equality Index as one of the
best places to work for
LGBTQ+ employees
Scan me
To view the supplier diversity
website
55
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Protecting the environment
We will help tackle climate change and reduce our impact on the
environment.
As an information services business, our most
material environmental impact is the carbon
footprint of our operations and value chain. The
Task Force on Climate-Related Financial
Disclosures (TCFD) statement sets out our
commitment to mitigating climate-related
risks and harnessing opportunities for our
products and business to support wider
climate action, in line with the
recommendations of the TCFD. We also
monitor and manage other environmental
impacts.
The climate-related financial disclosures set
out on pages 56-62 are consistent with the
TCFD recommendations and recommended
disclosures (against TCFD categories):
a
governance (a) and (b)
a
strategy (a), (b) and (c)
a
risk management (a), (b) and (c)
a
metrics and targets (a), (b) and (c).
For strategy disclosures (a) and (b), as we
continue to upskill internal stakeholders on
climate change impacts and see our climate
data and cross-functional collaboration
mechanisms mature, we expect our approach
to meeting TCFD recommendations to evolve
in parallel.
Governance
The Board oversees our climate strategy,
including climate-related risks and
opportunities presented in this TCFD
statement, and progress towards our targets
(including our science-based target). See page
103 for more on the division of responsibilities
across the Board.
The Group Operating Committee receives
regular updates on our climate action plan,
including progress on strategic drivers to
address climate-related issues, such as our
science-based target, the development of our
Net Zero Transition Plan and our TCFD
reporting.
The ESG Steering Committee, chaired by the
Chief Financial Officer, has overall
responsibility for assessing and monitoring the
management and performance of all areas of
ESG, including climate-related risks and
opportunities. Climate items addressed by the
ESG Steering Committee this year included
performance against our targets, development
of Experian’s Net Zero Transition Plan and
revision of our Scope 3 emissions methodology
(see page 60), as well as updates on relevant
legislation and reporting frameworks.
The Chief Sustainability Officer is responsible
at management level for ensuring successful
implementation of our climate plans and our
wider ESG strategy, with support from relevant
teams. See page 39 for more on our ESG
governance and organisational chart.
External recognition in FY23
TCFD statement
CDP Supplier Engagement Rating:
'A-' rating
Financial Times:
Experian has been named one
of Europe’s Climate Leaders for 2023 by the
Financial Times and Statista for the second year
in a row.
CDP Climate Change:
‘A-’ rating
Any significant climate-related risks are
reviewed by the Executive Risk Management
Committee and the Audit Committee, and
presented to the Board. We also enter specific
climate-related risks into our environment
management systems at Group, country and
site level, and these become part of our Aspect
and Impact Register, with plans defined to
manage the risks, monitor performance and
drive improvements.
Risk management
We are committed to identifying, assessing and
managing risks and opportunities presented by
climate change, both now and in the future.
We manage climate-related risks – strategic,
financial, operational or regulatory – in the
same way as our other business risks, as part
of our overall risk management process for the
business (see page 78). We apply our
established four-step framework for managing
business risks to identify, assess, respond to,
and report and monitor climate-related risks
as well as climate-related opportunities:
Step 1: Identification
We identify potential climate-related risks and
opportunities based on: relevant climate
change publications and data specific to the
regions where we operate; disclosures by peer
companies on their identified climate-related
risks and opportunities; TCFD guidance and
reviews on potential risks and opportunities;
and climate-related risks and opportunities
previously identified for Experian.
Step 2: Assessment
We evaluate the materiality of identified risks
and opportunities at least once a year by
undertaking scenario analyses to assess our
exposure and vulnerability to climate change
risks and potential opportunities – in the short
term (pre-2025), medium term (2025-2030)
and long term (2030+) – and quantifying the
potential financial impact of each risk or
opportunity for our business (see tables on the
next three pages). These timeframes have
been chosen taking into account the models
already used by our Strategy and Risk teams,
as well as the recognition that climate change
is an issue that spans beyond 2030.
Step 3: Response
We develop controls to mitigate or adapt to
identified risks, if these are not already in
place, as well as measures to capitalise on
Experian plc
Strategic report
56
identified opportunities. See more on our
business management response to specific
risks and opportunities in the tables below and
on the following pages.
Step 4: Reporting and monitoring
Our process for reporting and monitoring
climate-related risks and opportunities within
the business, up to Board level, is part of our
overall ESG governance as described on page
39. We disclose our most material
climate-related risks and opportunities in our
Annual Report and our CDP response.
Strategy
We assess climate-related risks and
opportunities across our business units and
the regions where we operate. Our most
material risks and opportunities are detailed in
the tables below and on the following pages.
Material risks are defined as those that have
the potential to have a significant effect on our
operations, strategy or financial performance
if they are not suitably controlled. Material
opportunities are those that have the potential
to enhance the financial performance of the
business.
This year, we refreshed our assessment of
material climate-related risks and
opportunities to take into account changes in
climate trends or science, as well as emerging
risks and opportunities. We modelled our
latest analysis on two climate warming
scenarios:
a
High-carbon scenario (4°C): A ‘worst-case’
scenario of climate change where
governments fail to introduce policies to
address climate change beyond those
already in place, which projects global
greenhouse gas emissions continuing to rise
(based on Representative Carbon Pathway,
RCP8.5). In this scenario, transition risks are
limited but there are significant physical
risks associated with rising temperatures
and weather extremes. RCP8.5 is the
scenario most widely used by companies,
governments, and academia. This means a
high availability of model projections and
studies to pull from, but also allows for
comparability. RCP8.5 has several
assumptions including: high population
growth, increased coal burning, and a
continued heavy reliance on fossil fuels.
However, removing these assumptions, the
outcomes of RCP8.5 are consistent and
plausible when compared to other climate
models.
a
Low-carbon scenario (1.5°C): An ‘aggressive
mitigation’ scenario that sees early decisive
policies and action towards a low-carbon
economy that is sufficient to limit global
warming to 1.5°C by the end of the century
(based on the International Energy Agency’s
(IEA) Sustainable Development Scenario). In
this scenario, physical risks are limited and
transition risks predominate. The IEA’s
Sustainable Development Scenario explores
a pathway for bringing global energy
systems to net-zero emissions by 2070.
Following this pathway would limit global
warming to 1.8°C (with a 66% probability)
and would present the best chance of
limiting warming to 1.5°C by the end of the
century. The scenario assumes a reduction
of emissions to 10bn tonnes of CO
2
e by 2050,
mostly stemming from the transport and
power sector, and driven by technological
progress and regulatory action.
We used these scenarios as they represent
two opposing pathways: one of rapid policy
and technological change that helps to limit the
extent of the physical impacts of climate
change, and one representing ‘worst case’
from a policy perspective such that rising
greenhouse gas emissions result in significant
physical climate impacts. We also selected
these scenarios because of their wide-ranging
scope, which aligns with the broad range of
geographies we serve.
Identified risks and opportunities remain
largely unchanged from previous
assessments, but we have enhanced our
disclosures this year to include further
information on potential financial impacts and
mitigation activities in relation to each risk and
opportunity, as set out in the tables below and
on the following pages.
Where potential financial impacts are
quantified, these are based on assumed
ranges of causal events that preclude
application of a strict materiality analysis. We
anticipate a materiality analysis will be enabled
in future as we further refine our approach to
quantifying climate-related risks and
opportunities. In the meantime, we disclose
estimated ranges, based on plausible
projections, to indicate an order of magnitude
of financial impacts associated with specific
climate-related risks and opportunities. At
present, there is no material impact of
climate-related matters on the Group’s
financial results.
We highlight some of the solutions we have
developed in relation to climate-related
opportunities on page 61.
*
These estimates are provided to indicate an order of magnitude of financial impact only. These are not intended to be, nor should they be perceived as, predictions.
Comprehensive understanding of risk drivers and control measures in place to mitigate, adapt to risk, capitalise on opportunity.
Transition impacts: Risks and opportunities arising from the process of adjusting to a low-carbon economy
Type
Policy and legal
Risk and opportunity factor
Climate change regulations
Experian risk category
Operational and regulatory
Time horizon
Short term
Maturity of assessment
Potential risks and opportunities
Risk: Increased operational expenses
(less than 1%* of annual revenue)
New laws, new interpretations of existing laws, changes
to existing regulations or heightened regulatory scrutiny
could affect how we operate. We could be subject to
penalties for non-compliance or see an increase in
operating costs to finance our efforts to meet regulatory
obligations. Enhanced obligations for climate reporting
could increase expenses associated with emissions
tracking, reporting and verification.
Business management response
We monitor, and engage legal experts on, regulatory and
industry developments. We have created new roles and
partnerships to help us understand and prepare for new
climate-compliance obligations across our regions. Our
governance and assurance processes are designed to
help avoid any misstatements in external reporting.
57
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Transition impacts: Risks and opportunities arising from the process of adjusting to a low-carbon economy (continued)
*
These estimates are provided to indicate an order of magnitude of financial impact only. These are not intended to be, nor should they be perceived as, predictions.
Comprehensive understanding of risk drivers and control measures in place to mitigate, adapt to risk, capitalise on opportunity.
Type
Policy and legal
Risk and opportunity factor
Carbon taxation
Linked metric:
Percentage reduction to
Scope 1 and 2 emissions from 2019
Linked target:
Reduce absolute Scope 1 and
2 emissions by 50% by 2030 (from 2019)
See page 60 for further information.
Experian risk category
Financial and strategic
Time horizon
Short, medium, and long term
Maturity of assessment
Potential risks and opportunities
Risk: Increased operational expenses
(less than 1%* of annual revenue)
Although our operations are not emissions-intensive,
implementation of external carbon pricing (such as
additional taxes on fuel, energy and aviation) to support
the transition to a low-carbon economy could increase
our operational expenses directly or indirectly through
increased costs of suppliers (primarily related to energy).
The magnitude of this risk is considered low because,
currently, electricity costs are less than 1% of operating
costs.
Opportunity: Reduced operational expenses
Further reductions in energy use and increases in
self-generation could reduce energy costs.
Business management response
Making progress towards our science-based target –
including through energy efficiency measures and
self-generation – helps mitigate risk associated with
potential carbon pricing in our direct operations and our
supply chain. Our supplier engagement programme
reduces exposure to carbon taxation on purchased goods
and services, which make up most of our value chain
carbon footprint. We are also developing a Net Zero
Transition Plan, in line with the UK’s Transition Plan
Taskforce draft Disclosure Framework, which will
enhance emissions reductions across the value chain in
the medium and long term.
Type
Market
Risk and opportunity factor
Product and service adaptation
Experian risk category
Strategic
Time horizon
Short, medium and long term
Maturity of assessment
Potential risks and opportunities
Risk: Revenue loss
If we do not adapt and develop products to meet the
potential increase in client and consumer awareness for
climate-friendly financial products and investment,
especially in the low-carbon scenario, we could lose
business to competitors.
Opportunity: Revenue growth
Developing products to meet potential increased
climate-related demand from clients and consumers
presents an opportunity for us, with use cases including
portfolio assessment, regulatory reporting, customer
engagement, application risk assessments and supply
chain management.
Business management response
Our products and services are flexible and adaptable to
low-carbon transitioning, and we are innovating to
capitalise on opportunities that will help our clients and
consumers adapt to and mitigate the effects of climate
change. We are also seeing a marked increase in enquiries
from clients, such as financial institutions, for data and
analytics services that can support them in understanding
emissions in their supply chains, analysing physical and
transitional climate-related risks in their portfolios, and
assessing applications based on the climate credentials of
the assets or organisations to be funded. Our existing
decisioning tools can help clients meet these needs by
bringing data and analytics into operational processes and
organisations. We are also developing new products and
services specifically designed to capture climate-related
opportunities for our business by supporting others in
efforts to understand and reduce their carbon footprints
(see page 61 for examples).
Type
Reputation
Risk and opportunity factor
Reputational impact
Linked metric:
Percentage reduction to
Scope 1, 2 and 3 emissions from 2019.
Linked target:
1. Become carbon neutral in
our own operations by 2030 and 2. Reduce
absolute Scope 1 and 2 emissions by 50%
by 2030 (from 2019) and reduce Scope 3
emissions from purchased goods and
services, business travel and fuel- and
energy-related activities by 15% by 2030
(from 2019)
See page 60 for further information.
Experian risk category
Operational and strategic
Time horizon
Short, medium and long term
Maturity of assessment
Potential risks and opportunities
Risk: Investment loss
Failure to meet increasing stakeholder and investor
expectations on climate action and disclosures could
damage the reputation of our brand. This could: lower
demand for shares, leading to a reduction in share price
as investors seek to shift capital away from companies
that are not managing climate change risks (unable to
quantify at this point); or removal of Experian from
climate-specific funds that are invested into on the basis
of positive climate action and revenue opportunities from
climate-related products (currently 0.2% of total market
capitalisation).
Opportunity: Access to finance
A strong response to the climate agenda and
contributions towards finding solutions could improve
our brand and reputation, and enable Experian to access
finance on favourable terms linked to climate,
sustainability or wider ESG performance.
Business management response
We are reducing our climate impact and disclosing our
climate and wider ESG performance transparently, to
help maintain our strong reputation with current and
future investors.
Transition risks could present a significant challenge to our business, and we are committed to mitigating the potential impacts. Our high-level
analysis highlighted that our climate action plan is critical to demonstrating strong climate stewardship and progress towards our science-based
targets, and our approach to carbon reduction and transparent climate disclosures is of paramount importance to our stakeholders.
Experian plc
Strategic report
58
Physical impacts: Risks and opportunities arising from climate or weather-related events
*
These estimates are provided to indicate an order of magnitude of financial impact only. These are not intended to be, nor should they be perceived as, predictions.
Comprehensive understanding of risk drivers and control measures in place to mitigate, adapt to risk, capitalise on opportunity.
Further work is required to understand regional risk drivers and control measures in place to mitigate, adapt to climate risk, capitalise on opportunity.
Type
Technology
Risk and opportunity factor
Rising temperatures
Linked metric:
Percentage reduction to
Scope 1 and 2 emissions from 2019
Linked target:
Reduce absolute Scope 1 and
2 emissions by 50% by 2030 (from 2019)
See page 60 for further information.
Experian risk category
Operational
Time horizon
Short and long term
Maturity of assessment
Potential risks and opportunities
Risk: Increased operational expenses
(less than 1%* of annual revenue)
Increased energy demand to run our infrastructure,
including cooling for data centres, due to increases to
external temperatures, could result in increased
operational expenses.
Business management response
We are mitigating the risk of rising energy costs through
planning and implementing energy efficiency measures,
and transitioning to co-located or cloud-based service
providers that will reduce our demands for cooling.
Type
Physical risk (acute and chronic)
Risk and opportunity factor
Extreme weather events
Experian risk category
Operational
Time horizon
Short, medium and long term
Maturity of assessment
Potential risks and opportunities
Risk: Expenses from property damage
Some of our sites are in areas that could experience
flooding (UK and Ireland), hail or cold-weather damage
from more extreme weather events (North America). This
could lead to property loss or damage, increased
insurance premiums and disruption to business
operations (see below). There is an estimated US$639m*
of insured property damage value exposed to some form
of physical climate risk across our operations.
Risk: Disruption to business operations
Extreme weather and related physical damage could
cause disruption to our operations, workforce and
suppliers. Our services must be available for our clients
and consumers 24 hours a day, seven days a week. If there
was disruption to our services causing an interruption of
daily revenue as a result of physical climate effects, the
estimated loss could range from US$1.25m in EMEA/Asia
Pacific to US$12.1m in North America (based on a daily
average of FY23 revenue).
Business management response
We have a range of measures in place to allow us to
mitigate risks from acute physical risks posed by
extreme weather conditions, and make our operations
more resilient in the face of extreme weather in the short
and medium term. As part of our commitment to reduce
operational emissions, we are investing in on-site
renewable energy generation that will also improve
resilience by providing cleaner back-up electricity in the
event of extreme weather conditions putting a strain on
the grid. This year, our insurance providers have
undertaken climate engineering surveys at our key
operational sites to help us understand what further
actions we can take to strengthen our climate resilience.
Type
Physical risk
Risk and opportunity factor
Migration of people
Experian risk category
Strategic
Time horizon
Medium and long term
Maturity of assessment
Potential risks and opportunities
Risk: Revenue loss
The chronic impacts of climate change, such as
increasing temperatures, flooding, storm damage and
limited access to clean water, will lead to higher levels of
migration and a global humanitarian crisis that could
disrupt markets, and prevent clients and consumers
from accessing our products and services.
Opportunity: Protecting financial health for all
Our products could help people rebuild their financial
identities and credit scores if these have been lost or
damaged through climate migration.
Business management response
Many of our established products and services designed
to enable financial inclusion for ‘credit invisibles’ could
help people who have migrated as a result of climate
change to rebuild their financial identities and credit
scores. Through our focus on improving financial health
for all (see page 42), we are innovating to develop further
solutions that could provide support.
Physical risks from climate change currently have a low impact on Experian’s operations, strategy and financial planning. Our operating model has
proven to be resilient to significant disruption, as experienced during the COVID-19 pandemic. We currently operate a small number of regional data
centres that are business-critical assets and exposure to extreme weather events is already considered from a business continuity and disaster
recovery perspective. However, we understand that under different future scenarios this may change, and we will continue to monitor signposts
identified as part of our climate scenario exercise.
The most critical physical risk to our business relates to the chronic effects of climate change and impacts from extreme weather events that could
lead to climate migrations, which may result in consumers becoming financially excluded as a result of being unable to access their data and
demonstrate their financial identities. These impacts are most significant under the high-carbon scenario we modelled.
The climate-related opportunities for our business are greater within the low-carbon future scenario we modelled, as they relate to the potential of
our business to support and facilitate the transition to a low-carbon future.
59
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Metrics and targets
We are committed to reducing our carbon
emissions in line with our targets, which are
validated by the Science Based Targets
initiative (SBTi), and we have set an additional
goal to become carbon neutral in our own
operations by 2030
1
.
Targets
Our climate targets are to:
a
Become carbon neutral in our own
operations by 2030¹:
–
Scope 1 and 2 (1.5°C scenario
2): reduce
absolute Scope 1 and 2 emissions by 50%
by 2030 (from 2019)
–
Scope 3 (2°C scenario
3): reduce absolute
Scope 3 emissions from purchased goods
and services, business travel and fuel-
and energy-related activities4 by 15% by
2030 (from 2019)
a
Offset 100% of our remaining Scope 1 and 2
emissions by 2025.
We are working to complete our Net Zero
Transition Plan in line with the UK’s Transition
Plan Taskforce draft Disclosure Framework.
We are also developing a revised Scope 3
target that takes into account our new
reporting methodology (see the next column).
Reducing operational emissions
This year, we reduced our Scope 1 and 2
market-based emissions by a further 38% to
10.1 thousand tonnes of CO
2
equivalent (CO
2
e),
cutting the carbon intensity of our direct
emissions by 41% to 1.5 tonnes of CO
2
e per
US$1m of revenue.
Since 2019, we have reduced our total Scope 1
and 2 emissions by 65%. This means we are
currently outperforming and well on track to
meet our science-based target to reduce these
emissions by 50% by 2030. We will continue to
seek ways to minimise the carbon footprint of
our operations as our business evolves.
We have achieved this by significantly
increasing purchasing of renewable electricity,
as well as improving energy efficiency and
continuing to embrace flexible ways of working
that have resulted in an overall decrease in
building occupancy, and consolidation and
reduction of office space. We have also
reduced energy use in our data centres by 3%
since FY22.
In the buildings we own or control, we are
continually looking for opportunities to switch
to renewable electricity contracts or, where
feasible, to invest in on-site installations to
generate our own renewable power. In FY23,
62% of our total electricity came from
renewable sources globally. We installed our
first solar photovoltaic array at our offices in
São Carlos, Brazil, which generates 11.5 MWh
per month and meets around 10% of the site’s
electricity demand. More on-site renewable
installations are planned for FY24.
We reduced overall energy use by 9% in FY23
compared with the previous year. Energy
efficiency measures this year included
upgrading the lighting at some of our offices in
Brazil and the UK, and optimising air-
conditioning systems for lower occupancy
levels in our North American offices. We also
completed a transformation of our London hub
in the UK that included maximising natural
light, upgrading to more energy efficient
lighting and monitors, and installing high-tech
connectivity tools in meeting and conference
rooms to reduce the need for travel by
enhancing the experience of virtual meetings.
We also moved to a new corporate
headquarters in Ireland which has some of the
highest sustainability credentials in the
market, being certified as a nearly zero-energy
building (NZEB) and achieving a LEED
(Leadership in Energy and Environmental
Design) Platinum score.
In addition, we are supporting the transition to
low-carbon transport by switching our owned
and controlled fleet to hybrid and electric
vehicles and installing charging infrastructure
at our sites. In the UK and Ireland, which
accounts for 33% of our global fleet, 85% of our
company cars are already hybrid or electric.
Enhancing Scope 3 reporting and engaging
with suppliers
Scope 3 greenhouse gas emissions account
for the majority (95%) of our total value-chain
carbon footprint, totalling 178.1 thousand
tonnes of CO
2
e in FY23.
This year, we have worked to improve the way
we calculate Scope 3 emissions in the
Purchased Goods and Services category
(which accounts for 73.5% of our Scope 3
emissions) to help us better measure progress
on our journey to decarbonise our value chain.
Previously, we calculated these emissions
using the Extended Economic Input-Output
model that relies on spend data and a small
pool of emissions factor categories. Now, we
are using a best-practice hybrid approach,
where actual emissions provided by our
suppliers through the CDP Supplier
Engagement Tool are combined with a much
larger, more specific pool of emissions factor
categories. Our emissions calculations for
FY23 include actual data provided directly by
suppliers representing 32% of our related
spend, and we aim to increase this over time
through ongoing engagement with suppliers.
See our website for details of the new hybrid
methodology.
We have restated previously reported emissions
for FY22 to show the impact of changing to the
new hybrid methodology. However, it is not
possible to recalculate emissions back to 2019,
the baseline year for our Scope 3 reduction
target. Therefore, we intend to re-baseline our
target as part of our net zero transition work.
The new targets will include all material Scope
3 categories and will be submitted to the SBTi
for approval. We will continue to encourage
more of our suppliers to submit emissions data
via CDP and to adopt their own science-based
targets. This will also enable us to explore ways
to switch to suppliers that can better support
our decarbonisation targets. We are pleased
that our continued engagement with suppliers
has been recognised with an 'A-' rating in the
CDP supplier engagement ratings.
Towards carbon neutral
Once we have achieved our science-based
target and reduced our value chain emissions
as far as possible, we will invest in high-quality
carbon offsetting projects to offset the
remaining Scope 1, 2 and 3 emissions within
the boundaries of our SBTi-approved targets,
to achieve carbon neutrality in our own
operations by 2030.
1
Includes all Scope 1 and 2 emissions, as well as Scope 3 emissions from purchased goods and services, business travel and fuel- and energy-related activities (which represent 83% of our baseline
emissions in Scope 3) in line with the boundaries covered by our Scope 3 target approved by the Science Based Targets initiative (SBTi). Once we have achieved our SBTi-approved targets, we will invest in
high-quality carbon offsetting projects to offset the remaining Scope 1, 2 and 3 emissions within the boundaries of our SBTi-approved targets to achieve carbon neutrality in our own operations by 2030.
2
Target approved by SBTi as in line with a 1.5ºC climate scenario.
3
Target approved by SBTi as in line with a 2ºC climate scenario.
4
Also known as ‘well-to-tank’, is an average of all the greenhouse gas emissions released into the atmosphere from the production, processing and delivery of a fuel or energy.
Solar photovoltaic array in São Carlos
Experian’s London hub
Experian plc
Strategic report
60
To support this, as part of our secondary
carbon offsetting commitment, we offset 60%
of our FY23 Scope 1 and 2 emissions by
investing in a Verified Carbon Standard
offsetting project in Kenya. The REDD+ Project
Phase II – The Community Ranches – from
Wildlife Works will not only avoid carbon
emissions, but also support climate adaptation,
promote biodiversity, bring added value to
communities and contribute to 11 of the 17
United Nations Sustainable Development
Goals. It has achieved Climate, Community and
Biodiversity Gold Level certification. We have
procurement criteria which set out the
requirements of our offset investments and we
review project monitoring reports annually to
evaluate the status and deliverables of the
invested project.
Harnessing opportunities to help clients
understand climate risks
We support clients with data analytics services
that can help them understand emissions in
their supply chains. For financial services
clients, we can help them analyse physical and
transitional climate-related risks in their
portfolios, and assess applications based on
the climate credentials of the assets or
organisations to be funded.
Developing these types of products will help us
capitalise on climate-related opportunities,
while supporting clients in managing their own
climate-related risks and opportunities.
Our established decisioning tools can help
clients meet these needs by bringing data and
analytics into operational processes and
organisations. We are also innovating to
develop bespoke products and services
specifically designed to help clients better
assess climate and other ESG-related risks,
including solutions that enhance visibility of
risks among small and medium-sized
enterprises (SMEs) and agribusiness.
Examples include:
a
ESG Insight: Our ESG Insight product scores
all UK SMEs for ESG risks (based on Scope
1, 2 and 3 emissions, as well as social
impact and governance ratings), enabling
lenders to better understand ESG risks and
calculate emissions within their customer
portfolio.
a
SME ESG ratings framework: In Europe,
where financial institutions are required to
incorporate ESG ratings into their risk
management frameworks to comply with
the regulations, we have developed a ratings
framework that draws on a range of data
sources, including climate data, to rate SMEs
on ESG.
a
Sustainability Indicator: Our Sustainability
Indicator in Spain automatically evaluates
SMEs on a range of ESG criteria (including
environmental factors, such as climate) and
summarises this assessment in a single
standardised indicator that supports clients’
ESG risk assessments and financial
decisions related to SMEs.
a
Smart ESG platform: Developed specifically
for agribusiness, our Smart ESG platform
enables clients in Brazil to assess and
monitor their portfolio based on compliance
with ESG regulations, including those
related to topics such as deforestation, and
environmental and social violations, to
support climate and ESG risk mitigation.
Through our Social Innovation programme, we
are also developing products to support
climate risk mitigation and adaptation by
enabling risk assessments and better access
to credit for smallholder farmers, who can
then use credit to invest in inputs to reduce
emissions and enhance climate resilience:
a
In Brazil, the Smallholders Marketplace we
launched this year is designed to improve
access to credit for smallholders in Brazil
and offers additional benefits through the
app such as weather alerts, remote sensing
of farms, training and other resources.
a
In Asia Pacific, we are developing an
agriculture index, to be launched in the
coming year, that will support clients in
offering affordable finance and insurance to
smallholders in Asia, which can help their
productivity and help to protect them from
climate risks.
Managing other environmental impacts
We recognise our business has other potential
impacts on the environment beyond climate
change. We are committed to identifying,
assessing and addressing environmental
risks, including in relation to issues that are
high on the global agenda, such as single-use
plastics, biodiversity and water.
Our environmental management systems help
us drive continuous improvements in
minimising the environmental footprint of our
operations and ensuring we comply with local
regulations. Local environmental management
systems across the business are aligned with
the internationally recognised ISO 14001:2015
standard, and four of our sites – three in the UK
and one in Bulgaria – maintain certification to
this standard through external audits.
Cutting out single-use plastics
Over the course of this year, we carried out a
single-use plastics (SUP) pilot to measure our
SUP footprint, scale up a global baseline and
inform a roadmap for action. We have
identified over five SUP types to phase out or
replace with non-SUP alternatives. Over the
course of the next two years we anticipate
this action will remove the vast majority of
avoidable SUP from our direct operations.
Promoting biodiversity
The COP15 Biodiversity Conference in 2022
highlighted that halting biodiversity loss is a
global priority and nature has a critical role in
tackling climate change and meeting the United
Nations Sustainable Development Goals.
Our business and operations do not have a
significant impact on biodiversity and we are
not dependent on a specific ecosystem service
for our business and economic activity to
function. However, we recognise that as a
global business, we have the power and ability
to influence change. Climate change and
biodiversity loss are interconnected, and
impacting one affects the other. The
Intergovernmental Panel on Climate Change
(IPCC) reports that 10% of species are expected
to face a high risk of extinction if global
warming rises above 2°C. Our commitment to
reduce carbon emissions through the Science
Based Targets initiative, and the reduction of
our footprint is closely connected to the
protection of biodiversity.
We are reviewing how to apply the
recommendations of the Taskforce on
Nature-related Financial Disclosures to our
business, and we are in the early stages of
assessing biodiversity-related risks and
opportunities in our operations using the Locate
Evaluate Assess Prepare framework.
Monitoring water use
This year, for the first time, we have collected
information from the two dedicated data
centres that use water in cooling systems.
Based on on-site metering, total water used at
these sites was 40,119 cubic metres in FY23.
We will continue to collect and analyse this
data to help identify ways to reduce water use
over time.
Engaging employees
Local campaigns through the year raised
awareness among employees of steps they
can take to help reduce our environmental
footprint and their own. For example, our
#LittleGreenSteps initiative ran challenges to
encourage people to be more conscious of
environmental impact and what they can do to
help. As part of this initiative, colleagues in
Bulgaria, Malaysia and the Netherlands
volunteered over 270 hours of their time to
support beach clean-ups and tree planting.
61
Experian plc
Annual Report 2023
Strategic report
Sustainable business
continued
Scan me
for our 2023 Reporting Principles and
Methodologies and PwC's Independent
Limited Assurance Report
CO
2
e¹
Unit
2023
2022
(restated)²
2022
2021
2020
2019
Scope 1
000s tonnes CO
2
e
2.8ª
2.5
2.5
2.2
3.0
3.6
Scope 2 (location-based)
000s tonnes CO
2
e
18.4ª
21.1
21.1
22.2
25.5
29.8
Scope 2 (market-based)
000s tonnes CO
2
e
7.3ª
13.9
13.9
14.3
22.1
25.6
Total Scope 1 and Scope 2 (market-based)
000s tonnes CO
2
e
10.1
16.4
16.4
16.5
25.1
29.2
Scope 3 (Purchased Goods and Services)
000s tonnes CO
2
e
130.9ª
125.7
412.0
350.9
378.9
357.4
Total Scope 3
000s tonnes CO
2
e
178.1
179.8
532.9
453.9
493.4
495.3
Total emissions
3
000s tonnes CO
2
e
188.2
196.2
549.3
470.4
518.5
524.5
Total emissions
3
normalised by revenue – per
US$1m revenue
tonnes CO
2
e / US$1m
revenue
28.4
31.2
87.4
87.6
100.1
107.9
1
CO
2
e emissions exclude any carbon offsets purchased by Experian.
2
In 2023 we have upgraded our Scope 3 methodology, from using a purely spend-based analysis to also including actual supplier emissions data. We are therefore restating our 2022 Scope 3 figures using
the same methodology, to provide comparable figures, resulting in restated figures for purchased goods and services, upstream leased assets, capital goods, and investments. Please refer to our 2023
Carbon Reporting Principles and Methodologies for further detail.
3
Including Scope 1, Scope 2 (market-based) and total Scope 3.
a
The 2023 data for Scope 1, Scope 2 (location-based), Scope 2 (market-based) and Scope 3 (purchased goods and services) emissions have been subject to independent limited assurance by PwC LLP in
accordance with ISAE 3000/ISAE 3410. Please refer to our 2023 Carbon Reporting Principles and Methodologies document and PwC’s Independent Limited Assurance report on our website.
Carbon emissions
Sources of Scope 3 emissions
Unit
2023
2022
(restated)²
2022
2021
2020
2019
2023
contribution
to Scope 3
(%)
Purchased Goods and Services
1
000s tonnes CO
2
e
130.9
125.7
412.0
350.9
378.9
357.4
73.5%
Fuel- and energy-related activities
1
000s tonnes CO
2
e
6.1
6.3
6.3
3.9
4.2
6.2
3.4%
Business travel
1
000s tonnes CO
2
e
7.5
1.8
1.8
0.3
3
15.2
49.1
4.2%
Upstream leased assets
000s tonnes CO
2
e
6.3
8.3
45.3
35.4
31.0
17.5
3.5%
Capital goods
000s tonnes CO
2
e
7.2
19.1
40.8
40.4
31.4
31.2
4.0%
Employee commuting
000s tonnes CO
2
e
19.7
17.8
17.8
13.7
24.8
24.6
11.1%
Investments
000s tonnes CO
2
e
0.3
0.5
8.6
8.9
7.7
4.3
0.2%
Waste generated in operations
000s tonnes CO
2
e
0.1
0.3
0.3
0.4
0.2
5.2
0.1%
Total Scope 3
000s tonnes CO
2
e
178.1
179.8
532.9
453.9
493.4
495.3
Subset of emissions within Scope 3
science-based target (Purchased Goods and
Services, Business Travel, and Fuel- and
energy-related activities)
000s tonnes CO
2
e
144.5
133.8
420.1
355.1
398.3
412.6
1
Scope 3 emissions within science-based targets.
2
In 2023 we have upgraded our Scope 3 methodology, from using a purely spend-based analysis to also including actual supplier emissions data. We are therefore restating our 2022 Scope 3 figures using
the same methodology, to provide comparable figures, resulting in restated figures for purchased goods and services, upstream leased assets, capital goods, and investments. Please refer to our 2023
Carbon Reporting Principles and Methodologies for further detail.
3
Only covers emissions from air travel.
Sources of Scope 3 emissions relevant to our business
SECR indicator
Unit
2023
2022
2021
Scope 1: Global (excluding UK)
000s tonnes CO
2
e
2.3
2.0
1.9
Scope 1: UK
000s tonnes CO
2
e
0.5
0.5
0.3
Scope 2 (location-based): Global (excluding UK)
000s tonnes CO
2
e
14.7
16.7
16.8
Scope 2 (location-based): UK
000s tonnes CO
2
e
3.7
4.4
5.4
Total Scope 1& 2 (location-based): Global (excluding UK)
000s tonnes CO
2
e
17.0
18.7
18.7
Total Scope 1& 2 (location-based): UK
000s tonnes CO
2
e
4.2
4.9
5.7
Energy consumption used to calculate above emissions: Global (excluding UK)
kWh
48,675,621
50,859,896
51,154,107
Energy consumption used to calculate above emissions: UK
kWh
20,626,911
24,358,946
25,401,992
Total emissions normalised by revenue – per US$1m revenue: Global (excluding the UK)
tonnes CO
2
e
2.9
3.4
4.0
Total emissions normalised by revenue – per US$1m revenue: UK
tonnes CO
2
e
5.4
5.9
7.7
Specific to SECR disclosure: Experian does not have any ‘offshore’ operations. Therefore, where the 'UK' is referenced in the indicators above we have reported 'UK' only.
Streamlined Energy and Carbon Reporting (SECR) Disclosure
Experian plc
Strategic report
62
Health
There is a scary trend in US
healthcare: claim denials. It is a nasty
sting in the tail, both for hospitals and
patients, when after treatment the
insurance company refuses to pay
for all or part of it. Denials, often
automated, have increased 23%
since 2016.
It is the biggest strategic challenge
facing hospitals, and they are losing
billions of dollars in write-offs. With
manual systems and a staffing
shortage in back-office operations,
they frequently don’t have the
resources to appeal against every
denial.
Experian’s AI Advantage uses artificial
intelligence to supercharge a
hospital's claims processing. It uses
machine learning models to generate
real-time predictions of the most likely
reasons for which a claim may be
denied, prior to claim submission. It
also allows hospitals to segment any
denials that do occur so that billing
staff are able to better prioritise their
work. Claims are processed faster,
denials are reduced significantly
and revenue is increased. Leaving
hospitals to focus on serving
their patients.
Removing the sting from healthcare claims
We are
to address healthcare’s biggest business
innovating
challenges.
Tom Bonner
Product Management Principal,
Experian Health
North America
63
Experian plc
Annual Report 2023
Strategic report
Section 172
Section 172 legislation, which became
effective in the UK during FY20, aims to
help shareholders better understand how
directors have discharged their duty to
promote the success of companies, while
having regard to the matters set out in
Section 172(1)(a) to (f) of the UK Companies
Act 2006 (s172 matters). In addition, the
2018 UK Corporate Governance Code
recommends that boards describe how
the matters set out in Section 172 have
been considered in Board discussions
and decision-making.
Section 172 defines the duties of company
directors and concerns the duty to promote
the success of companies. Throughout FY23,
the directors of the Company continued to
exercise these duties while having regard to
the s172 matters, and also to other relevant
factors as they reviewed and considered
proposals from senior management, and
as they governed the Company on behalf
of its shareholders through the Board and
its committees.
Experian plc is a Jersey-incorporated
company. Nevertheless the Board embraces
Section 172 and fully supports its aims,
and we are reporting in line with the UK
requirement.
We outline below, through use of cross
reference, where we have considered the
s172 matters throughout this Annual Report.
Non-financial information and s172(1) statement
We report in line with the Non-
Financial Reporting requirement
as detailed in Sections 414CA and
414CB of the UK Companies
Act 2006.
Our aims
Our business model is set out on pages 22-27.
We use the power of data to create
opportunities, improve lives and make a
meaningful difference in society, helping
individuals and businesses of all sizes,
to achieve their financial goals.
Non-financial risks
The Risk management and principal risks
section of the Strategic report, starting on
page 78, sets out the Group’s approach to
identifying and managing our principal risks
and uncertainties. Our Three Lines of Defence
model provides a rigorous governance
framework, and the list of principal risks
starting on page 80 gives details of the policies,
outcomes and due diligence processes that
control and mitigate those risks.
The key areas where non-financial adverse
impacts could arise are:
1. Respect for human rights
As data custodians, we have a responsibility
to safeguard consumer privacy, and our five
Global Data Principles guide how we manage
and use data, build products and conduct our
business around the world (see page 45).
Our Global Code of Conduct¹ aligns with the
United Nations Universal Declaration of Human
Rights, and our commitment to ensuring an
ethical supply chain¹ is borne out by our
membership of the Slave-Free Alliance.
2. Employees
Employee engagement is a key performance
indicator (see page 21), and we talk on pages
51-53 about our many programmes and
initiatives that inspire our people to be their
best, to bring their whole selves to work, our
commitment to diversity, equity and inclusion,
and our recruitment, retention and succession
practices that help to mitigate the risk of our
dependence on highly skilled personnel.
3. Environmental matters¹
We take our environmental responsibilities
seriously, and the reduction of greenhouse gas
emissions is a key performance indicator for
us (see page 21). See also page 56 for further
actions and initiatives Experian is taking to
help protect the environment².
4. Anti-corruption and anti-bribery
Our Anti-Corruption Framework¹ sets out
our zero-tolerance policy on bribery and
corruption in any form, and this message is
reinforced through mandatory annual training
for employees.
5. Social matters
Experian has many initiatives in place to
deliver our purpose of creating a better
tomorrow for consumers, businesses, our
people and our communities. The role we play
benefits everyone: businesses grow, people
prosper and communities thrive. This happens
in many ways, including through our core
business, the development of social innovation
products, employee volunteering and support
for community groups and charities.
1
Further detail is available at www.experianplc.com/responsibility/our-policies.
2
Further detail is available at www.experianplc.com/responsibility/data-and-assurance.
Section 172 matters
Specific examples
Page
(a) The likely consequences of any decision in the
long term
a
Our strategy and dividend policy, taken together with sections of our Financial
review, explains how we balance returns to shareholders with capital invested
organically and on acquisitions
a
28, 72-75, 178
a
Our governance framework shows how the Board delegates its authority
a
102
(b) The interests of the company’s employees
a
Stakeholder engagement – Our people
a
Inspiring and supporting our people
a
18
a
51-53
(c) The need to foster the company’s business
relationships with suppliers, customers
and others
a
Stakeholder engagement
a
Our business model
a
16-19
a
23
(d) The impact of the company’s operations
on the community and the environment
a
Improving financial health for all and Our communities
a
Protecting the environment
a
17, 42, 43
a
56
(e) The desirability of the company maintaining
a reputation for high standards of business
a
Treating data with respect
a
Working with integrity
a
45
a
54
(f) The need to act fairly between members
of the company
a
Stakeholder engagement
a
Shareholder and stakeholder engagement
a
19
a
104-107
Experian plc
Strategic report
64
Sustainability Accounting Standards Board Index
We report against the Sustainability Accounting Standards Board (SASB) standards. The Index below shows our
response to each of the SASB metrics for the Professional and Commercial Services sector.
Sustainability disclosure topics and accounting metrics
Activity metrics
Topic
Accounting metric
Code
Our response
Data security
Description of approach to identifying
and addressing data security risks
SV-PS-230a.1
See the Data security section of our Annual Report (pages 45-46).
Description of policies and practices
relating to collection, usage, and
retention of customer information
SV-PS-230a.2
See the Treating data with respect section of our Annual Report
(pages 45-49), which includes our Global Data Principles. This section
details the processes we follow to ensure accuracy of data, the
regulations we comply with and the consumer websites where we
detail our approach to data privacy.
Number of data breaches, percentage
involving customers’ confidential
business information or personally
identifiable information, and number of
customers affected
SV-PS-230a.3
In the event of a serious breach, we would disclose information about
the incident and commit to contact any affected data subjects in a
timely way. We do not publicly disclose vulnerabilities or lapses due
to client sensitivities. To the extent that any relevant regulator should
find fault with our data breach management or data security
practices, they will publish their findings and any related sanctions.
There were no new findings or sanctions in FY23.
Workforce diversity and
engagement
% of gender and racial/ethnic group
representation for executive
management and all other employees
SV-PS-330a.1
We report gender and racial/ethnic diversity in the data tables
available on our website, with our US racial/ethnic diversity shown
in accordance with the EEO-1 categories. See the Inspiring and
supporting our people section of our Annual Report (pages 51-53)
and in our DEI Report.
Voluntary and involuntary turnover
rate for employees
SV-PS-330a.2
We report both voluntary and involuntary turnover rates in the data
tables available on our website.
Employee engagement (%)
SV-PS-330a.3
We report employee engagement as one of our key performance
indicators for the business. See the Inspiring and supporting our
people section of our Annual Report (pages 51-53) and the data
tables available on our website. Our employee engagement score
in our FY23 Great Place To Work survey was 82%, up four points
from the previous year.
Professional integrity
Description of approach to ensuring
professional integrity
SV-PS-510a.1
See our Data Principles (page 45) and the Working with integrity
section of our Annual Report on (pages 54-65). This latter section
outlines the importance of our Global Code of Conduct, designed to
give everyone a clear understanding of our approach to professional
and ethical standards and ensure employees all know exactly what
is expected of them individually, and the role they play in helping
Experian live up to those standards. This code has been approved
by the Experian plc Board and we are fully committed to
implementing it across our business.
Total amount of monetary losses as a
result of legal proceedings associated
with professional integrity
SV-PS-510a.2
Material monetary losses associated with legal proceedings,
sanctions or fines that are a matter of public record are disclosed
in our Financial Statements (see page 162 onwards). In the case
of pending and threatened litigation claims, management applies
judgment as to the likelihood of ultimate liability and recognises
the liability where the likelihood of potential loss arising is possible
rather than probable and having a potentially material impact.
Activity metric
Code
Our response
Number of employees: full-time and part-time, temporary and
contract
SV-PS-000.A
We report this data in the ESG performance data tables available on
our website.
Employee hours worked and % billable
SV-PS-000.B
Not applicable to our business.
Scan me
to see our ESG performance
data tables
65
Experian plc
Annual Report 2023
Strategic report
Highlights 2023
We achieved a strong financial performance
in FY23 despite an uncertain macroeconomic
environment. Total revenue growth was
8% at constant exchange rates, and both
Benchmark EBIT and Benchmark EPS grew
by 9%.
Lloyd Pitchford
Chief Financial Officer
Summary
We achieved a strong financial performance
in FY23 despite an uncertain macroeconomic
environment. At constant exchange rates, we
delivered organic revenue growth of 7%, and
total revenue growth of 8% after taking into
account the contribution from acquisitions.
Revenue growth converted well to Benchmark
EBIT growth and into operating cash flow, with
Benchmark EBIT up 9% and operating cash
flow conversion of 98%. Benchmark EPS grew
strongly by 9%.
After another year of strong growth and cash
flow conversion, we ended the year in a robust
financial position with Net debt/Benchmark
EBITDA of 1.8 times.
Reflecting the Group's strong performance and
financial position, the Board has announced
a full-year dividend increase of 3 US cents
per share.
Financial review
*Alternative Performance Measures
We have identified and defined certain non-GAAP measures. These are the key measures
management uses to assess the underlying performance of our ongoing businesses.
There is a summary of these measures on page 76 and a fuller explanation in note 7
to the Group financial statements on pages 175 to 177.
2023
US$m
2022
US$m
Growth
%
Revenue
6,619
6,288
5
Operating profit
1,265
1,416
(11)
Profit before tax
1,174
1,447
(19)
Profit after tax
1
773
1,151
(33)
Net cash inflow
from operating
activities
1
1,717
1,796
(4)
Full-year dividend
per share
USc54.75
USc51.75
6
Basic EPS
USc84.2
USc127.5
(34)
Revenue
US$
6.6
bn
Total revenue growth –
ongoing activities*
8
%
(at constant FX)
Organic revenue growth*
7
%
(at constant FX)
Benchmark EBIT*
US$
1.8
bn
Profit before tax
US$
1.2
bn
Cash flow conversion*
98
%
Basic EPS
USc
84.2
Benchmark EPS*
USc
135.1
Ordinary dividends
US$
482
m
Strong financial performance
2023
US$m
2022
3
US$m
Constant
rates
growth
%
Revenue
4
6,587
6,216
8
Benchmark EBIT
1,794
1,645
9
Benchmark PBT
1,670
1,535
9
Benchmark
operating cash
flow
1,753
1,800
(2)
Undrawn
committed bank
facilities
2,415
2,600
n/a
Benchmark EPS
USc135.1
USc124.5
9
1
From continuing operations.
2
See note 7 to the Group financial statements for definitions
of non-GAAP measures.
3
Results for FY22 are re-presented for the reclassification
to exited business activities of certain B2B businesses.
4
From ongoing activities.
Statutory financial highlights
Benchmark financial highlights
2
Experian plc
Strategic report
66
1
Revenue, Benchmark EBIT and Benchmark EBIT margin for FY22 are re-presented for the reclassification to exited business
activities of certain B2B businesses. See note 10 to the Group financial statements.
2
At constant exchange rates.
3
Benchmark EBIT margin for ongoing activities is calculated by dividing Benchmark EBIT for ongoing activities by revenue from
ongoing activities.
202
3
20
22
2021
2020
20
19
Revenue
6,
619
6,
288
5,
372
5,
179
4,
861
US$m
202
3
20
22
2021
2020
20
19
Benchmark EPS
135.
1
124.
5
103.
1
103.
0
98.
0
USc
202
3
20
22
2
2021
2020
20
19
Total Benchmark EBIT
and Benchmark EBIT margin
27.
4
26.
6
25.
8
26.
9
26.
9
Margin %
1
1,794
1,645
1,386
1,387
1,311
US$m
202
3
20
22
2021
2020
20
19
Dividend per share
54.
75
51.
75
47.
00
47.
00
46.
50
USc
1
From ongoing activities.
2
Results for FY22 are re-presented for the reclassification to
exited business activities of certain B2B businesses.
Year ended 31 March
2023
US$m
2022¹
US$m
Total growth²
%
Organic growth²
%
Revenue
Data
3,440
3,303
6
5
Decisioning
1,365
1,300
8
8
Business-to-Business
4,805
4,603
7
6
Consumer Services
1,782
1,613
12
11
Ongoing activities
6,587
6,216
8
7
Exited business activities
32
72
n/a
Total
6,619
6,288
8
Benchmark EBIT
Business-to-Business
1,529
1,431
8
Consumer Services
416
374
12
Business segments
1,945
1,805
9
Central Activities – central corporate costs
(143)
(152)
n/a
Ongoing activities
1,802
1,653
9
Exited business activities
(8)
(8)
n/a
Total Benchmark EBIT
1,794
1,645
9
Net interest expense
(124)
(110)
n/a
Benchmark PBT
1,670
1,535
9
Exceptional items
(66)
21
n/a
Other adjustments made to derive
Benchmark PBT (note 15(a))
(430)
(109)
n/a
Profit before tax
1,174
1,447
n/a
Benchmark EBIT margin – ongoing activities
Business-to-Business
31.8%
31.1%
Consumer Services
23.3%
23.2%
Benchmark EBIT margin
3
27.4%
26.6%
Revenue, Profit before tax and Benchmark EBIT margin by business segment
Performance summary
Commentary on revenue and Benchmark
EBIT performance by region is provided
earlier in the Strategic report, within the
Chief Executive’s review on pages 12 and 13.
67
Experian plc
Annual Report 2023
Strategic report
Financial review
continued
Strong and resilient growth record
We have reported organic revenue growth
every year over the past 17 years, in spite of
the challenges faced during the global financial
crisis of 2008 and more recently the COVID-19
pandemic.
We continue to diversify our business,
investing in new market verticals and
geographies. Through continuous innovation
and investment, we are able to launch new
products, bringing solutions to market more
quickly, harnessing technological
developments such as big data platforms
and AI to focus on customer needs.
Our business model is scalable, allowing us
to grow revenues quickly at low incremental
cost, maximising synergies by combining data
sources and integrating analytics.
Customer expectations have never been higher,
nor the pace of technological change faster. We
are moving more of our technologies to the
cloud, to give us market-leading data availability
that allows delivery of cutting-edge products.
Business-to-Business revenue growth at
constant exchange rates was 7%, reflecting
progress in new products, new business wins,
strong demand for analytics, and the
development of new markets and products,
such as the new Ascend module Ascend Ops.
8%
4%
3%
2%
8%
10%
8%
5%
1%
5%
5%
5%
9%
8%
7%
12%
4%
15%
10%
5%
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY23
FY21
FY22
Global Financial Crisis
COVID-19
pandemic
Historic organic revenue growth performance
1
(at constant FX)
1
Ongoing activities.
Revenue grew across all regions, at constant
exchange rates, notwithstanding a softer US
mortgage market, where revenue declined
year on year. There was again a strong
performance in Latin America, where B2B
organic revenue growth was 13% at constant
currency, as we continue to benefit from
uptake of positive data products. Verification
services performed well, enhanced by recent
acquisitions. Ascend implementations continue
to grow as we secured new client wins for our
global platform.
We are making progress with the repositioning
of EMEA/Asia Pacific, focusing on key
geographies and implementing a programme
to reduce regional overheads and exit
sub-scale activities.
Consumer Services continued to perform
strongly, with organic revenue up by 11% at
constant exchange rates, reflecting growth in
the marketplace and upselling of premium
services. Our free membership base increased
to 168 million globally. Innovations are
developing at pace, having a real impact on
people’s lives as we drive financial inclusion.
Around 13 million US consumers have
connected to Experian Boost. More than
93 million points have been added to credit
scores using Experian Boost in the last four
years. Richer features are attracting and
FY19
57
FY20
82
FY21
FY22
FY23
110
145
134
155
168
FY18
40
C
D
B
A
C
D
B
A
C
B
A
C
B
A
C
B
A
C
B
A
A: USA
B: Brazil
C: UK
D: Spanish Latin America
Consumer Services free member base
million
FY20
FY19
FY21
FY23
FY22
FY17
FY18
548
359
711
A
B
A
B
A
B
A
B
A
B
A
A
B
B
1,229
976
108
213
B: Consumer Services
products
– North America
marketplace
– New North America
identity premium
subscription
– Brazil Consumer Services
– Spanish Latin America
Consumer Services
– UK marketplace
A: B2B products
– Ascend
– PowerCurve
– Experian One
– Fraud propositions
– New Health products
– New Auto products
– Positive data
Revenue from product innovation
US$m
engaging a larger audience. We are rolling out
Experian Activate in the USA to help lenders
target credit offers more precisely, and in
January 2023 we launched CreditLock in the
UK, a feature enabling consumers to lock their
credit report at the touch of a button to prevent
unauthorised access and avoid fraud.
Our debt resolution product in Brazil, Limpa
Nome, which helps consumers resolve and
settle bills, continues to perform strongly.
In November and December 2022, Serasa
Experian held its biggest debt renegotiation
event to date, brokering more than 7.7 million
deals, with average discounts of 78%.
Strong Consumer Services growth in North
America and Latin America was offset by a
decline in organic revenue in the UK, as
volumes reduced, reflecting tighter lending
conditions, as well as reduced premium
subscription revenue.
Reporting currency
We report our financial results in US dollars.
The weakening of our other trading currencies
during the year, primarily the pound sterling
and the euro against the US dollar, reduced
total revenue by US$145m and Benchmark
EBIT by US$5m. A ± 1% change in the Brazilian
real or pound sterling exchange rate would
impact total revenue by ± US$8m respectively.
Prior years include the addition of new products.
Experian plc
Strategic report
68
A. Labour
53
B. Data
17
C. Marketing
12
D. IT
7
E. Central Activities
3
F. Other
8
A
B
C
D
E
F
FY23 Global cost profile
%
1
Revenue from ongoing activities.
A. Financial services
39
B. Direct-to-consumer
17
C. Health
7
D. Retail
6
E. Software and Professional services
5
F. Automotive
4
G. Insurance
4
H. Media and Technology
4
I. Government and Public Sector
3
J. Telecoms and Utilities
3
K. Other
8
A
B
C
D
E
F
G
H
I
J
K
FY23 Revenue by customer
%
1
FY22
304
FY21
301
FY20
299
FY19
291
FY23
306
Revenue per FTE
US$’000
Our global delivery centres located in Bulgaria,
Chile, Costa Rica, India and Malaysia, employed
approximately 4,300 staff at March 2023, and
will continue expanding as we execute our
transformation agenda, generating
productivity savings to reinvest in talent,
technology, and innovation. They are also
contributing to the 65% reduction in our
Scope 1 and 2 emissions since 2019.
We expect employee productivity to grow as
we increasingly use robots to automate routine
tasks, improving speed, quality, capacity and
job satisfaction. Automation is focused on
sales operations, customer service, finance
and other back-office functions.
Since the programme launched we have
automated manual activity, with approximately
57 million transactions processed, and c.390
bots in production in FY23.
Through our Future of Work programme, we
have increased the flexibility of our workforce,
allowing employees to work from their home
or office to best suit their needs. This enables
us to both retain and attract talent, while
reducing our dependence on real estate.
We monitor the macroeconomic environment
and are taking steps to manage costs
appropriately, implementing further controls on
discretionary spending. Rigorous contractual
frameworks, effective negotiation and volume
commitments mitigate inflationary pressures.
We remain focused on reviewing and
identifying opportunities in our contracts with
key suppliers. For example we recently
reached agreement with a global web services
provider that will support the scaling of
cloud-based solutions in a more sustainable
manner.
All of these productivity initiatives are enabling
us to reinvest savings into our technology and
our people. New technologies require new
skills. As we transform our business, we
create opportunities for our workforce to
develop and grow with us, maximising their
expertise. We have created a Career Hub
delivering top-class training for our
Leadership, Analytics and Tech employees.
We are offering support to our employees to
help them cope with heightened inflation and
cost increases, enabled by the productivity
savings we are making.
Statutory measures
Revenue grew 5% in the year to US$6,619m
(2022: US$6,288m) notwithstanding a
dampened global economy, reflecting the
resilience of our business. We have an
outstanding product set unrivalled in breadth
and depth of capability, strengthening our
competitive advantage.
Business-to-Business revenue grew 3% to
US$4,837m (2022: US$4,675m) and Consumer
Services revenue was up 10% to US$1,782m
(2022: US$1,613m). Growth was strong in
North and Latin America, up 8% and 20%
respectively. Revenue in UK and Ireland was
down 7%, impacted by the 12% weakening of
the pound sterling exchange rate against the
US dollar in the year.
Benchmark EBIT from ongoing activities was
US$1,802m (2022: US$ 1,653m), growing 9%
at constant and actual exchange rates.
Benchmark EBIT margin from ongoing
activities was 27.4% (2022: 26.6%), and was
assisted by foreign exchange movements by
50 basis points.
We provide details of the principal exchange
rates used and currency exposures in note 11
to the Group financial statements on page 185.
Productivity and cost management
In these times of macroeconomic uncertainty,
productivity is more crucial than ever.
There is upward pressure on labour-related
costs from increased inflation and low rates of
unemployment. A 1% rise in our base payroll
costs would lead to an additional expense of
US$24m.
We continue to invest in our EmPower
productivity programme, global delivery
centres and new technology to enable
increasing economies of scale and sharing of
services, reducing our time to market and
enhancing our ability to grow profitably.
Process improvements transform how we
support our customers, reduce waste and
create capacity for business reinvestment.
We now have 2,585 employees trained,
leveraging Lean Six Sigma process-
improvement methodologies. We have
completed over 690 projects in FY23 focusing
on product development, finance, analytics and
technology functions, with 680 in progress,
generating savings and improvements in
operating capacity.
69
Experian plc
Annual Report 2023
Strategic report
Financial review
continued
Revenue in EMEA/Asia Pacific was similarly
impacted by adverse exchange rate
movements, and was down by 14% in the year,
due to a combination of exchange effects and
as we exit from non-core activities.
Acquisitions contributed US$37m (2022:
US$93m) to revenue growth in the year and
US$3m (2022: US$17m) to profit before tax,
though we bore a charge of US$45m (2022:
US$26m) for increased contingent
consideration due to over-performance on
prior acquisitions.
Even though our business is less prone to
macroeconomic impacts than many others,
it is still susceptible to the general weakening
of global financial conditions. We incurred a
non-cash charge of US$179m (2022: US$nil)
for EMEA goodwill impairment, driven by
increased discount rates and macroeconomic
weakness in our European markets.
While our plan to focus our EMEA/Asia Pacific
operations is progressing well, we incurred
additional exceptional restructuring costs of
US$53m (2022: US$20m). The net gain from
associate disposals of US$1m (2022: US$90m)
was much reduced.
The additional costs discussed above
contributed to the reduction in operating profit
to US$1,265m from US$1,416m in FY22, down
11%. Net finance expense increased to US$74m
(2022: net finance income of US$59m) from a
movement of US$59m in foreign exchange
losses on Brazilian real intra-Group funding,
and other fair value remeasurements.
Profit before tax declined to US$1,174m (2022:
US$1,447m), and the tax charge for the year
increased to US$401m (2022: US$296m),
34.2% (2022: 20.5%) of profit before tax,
impacted by the non-deductibility of the
goodwill impairment and an increase in tax
on other expenses not deductible of US$46m.
The impairment of associate investments,
acquisition and disposal expenses and some
financing fair value remeasurements are not
allowable for tax purposes.
Basic EPS decreased to 84.2 US cents (2022:
127.5 US cents). The reduction reflects a lower
profit before tax, no repeat of the prior year
profit from discontinued operations of US$16m
and an increased effective tax rate.
Outlook
Despite increased economic headwinds and
a challenging global economy, we anticipate
growth will continue in FY24, with total
projected organic revenue growth in the range
of 4-6% for the year as a whole, with modest
margin improvement. Our products and
services are often integral to clients’ operating
processes, generating highly recurring
revenue. Growth is bolstered by the expansion
of counter-cyclical revenue streams and the
diversity of our portfolio. Revenue from our
strategic investments is starting to scale, with
new growth areas less affected by the general
slowdown.
While revenue is expected to decline in some
areas as macroeconomic growth slows, a
more difficult marketplace also presents us
with opportunities, as we help clients navigate
the macroeconomic environment. Consumer
demand for credit is generally elevated and
lender appetite is increasing for analytics to
monitor affordability and provide cost-of-living
insights.
We have significant addressable markets,
estimated at over US$150bn, and the
development of our unique innovative products
is allowing us to make headway in these
markets. We expect further strengthening and
diversification of our portfolio to enable us to
be even more resilient than in the global
financial crisis.
Interest
Benchmark net finance costs increased by
US$14m, reflecting an uplift in average market
interest rates as central banks raised rates in
response to heightened inflation.
We have maintained a high proportion of debt
at fixed rates. At 31 March 2023, interest on
90% of our net funding was at fixed rates
(2022: 98%), mitigating the impacts of general
rate rises. This fixing will have a significant
Year ended 31 March
2023
%
2022
%
Tax charge on Benchmark PBT
26.0
25.7
Tax relief on goodwill amortisation
(2.0)
(2.4)
Timing differences on US innovation and development expenditure
2.5
—
Benefit of brought forward tax losses
—
(1.7)
Other
4.9
2.2
Tax paid as a percentage of Benchmark PBT
31.4
23.8
Cash tax reconciliation
impact on future interest charges, as indicated
by the fair value of interest rate swaps, which
has increased to US$88m (2022: US$41m).
The effective interest rate on loan and bond
debt, including derivatives, was 2.9% (2022:
2.7%).
Taxation
Our effective tax rate on Benchmark PBT
was 26.0% (2022: 25.7%), reflecting the mix
of profits and prevailing tax rates by territory.
We expect our effective tax rate on Benchmark
PBT in FY24 will be around 26-27%, impacted
by the increase in the main rate of UK
corporation tax from 19% to 25% from
1 April 2023.
The equivalent cash tax rate of 31.4% (2022:
23.8%) is above our Benchmark tax rate and
we provide a reconciliation in the table below.
Timing differences on US innovation and
development expenditure in FY23 are as a
result of US legislative changes. 'Other' in
FY23 includes tax on fair value gains on the
remeasurement of derivatives, and phasing
of tax payments. 'Other' included the phasing
of tax payments in FY22.
While we note proposals that the US legislative
changes may ultimately be repealed, we
anticipate that our cash tax rate will align more
closely to our Benchmark tax rate over the
medium term, as timing differences unwind.
Percentage of debt at fixed
interest rates
%
2022
2021
2020
2019
2023
98%
91%
67%
68%
90%
FY22
1,800
FY21
1,476
FY20
1,214
FY19
1,270
FY23
1,753
Benchmark operating cash flow
US$m
and cash flow conversion
%
97%
88%
106%
109%
98%
Experian plc
Strategic report
70
Year ended 31 March
2023
US$m
2022
US$m
Benchmark EBIT
1,794
1,645
Amortisation and depreciation charged to Benchmark EBIT
482
484
Benchmark EBITDA
2,276
2,129
Impairment of non-current assets charged to Benchmark EBIT
1
—
Net capital expenditure
(627)
(489)
Decrease in working capital
30
58
Principal lease payments
(57)
(57)
Benchmark loss retained in associates
1
10
Charge for share incentive plans
129
149
Benchmark operating cash flow
2
1,753
1,800
Net interest paid
(118)
(121)
Tax paid
(525)
(366)
Dividends paid to non-controlling interests
(1)
(2)
Benchmark free cash flow
1,109
1,311
Acquisitions
(480)
(781)
Purchase of investments
(15)
(32)
Disposal of operations and investments – ongoing activities
3
23
Distributions from investments
—
2
Repayment of promissory note and interest
—
110
Movement in Exceptional and other non-benchmark items
(39)
(19)
Ordinary dividends paid
(482)
(444)
Net cash inflow – continuing operations
96
170
Net debt at 1 April
(3,950)
(4,026)
Discontinued operations
—
1
Net share purchases
(175)
(149)
Non-cash lease obligation additions and disposals
(29)
(35)
Principal lease payments
57
57
Foreign exchange and other movements
(29)
32
Net debt at 31 March
(4,030)
(3,950)
1
For Group cash flow statement see page 166.
2
A reconciliation of Cash generated from operations to Benchmark operating cash flow is provided in note 41(g) to the Group financial
statements.
Cash flow and Net debt summary
1
Earnings per share
Benchmark EPS was 135.1 US cents (2022:
124.5 US cents), up 9% at actual and constant
exchange rates. A ± 10% change in the
Brazilian real exchange rate would impact
Benchmark EPS by ± 2 US cents. A similar
change in the pound sterling exchange rate
would impact Benchmark EPS by less than
± 1 US cent. We provide further information
in note 19 to the Group financial statements
on pages 191 to 192.
Cash and liquidity management
The Group is highly cash generative converting
98% (2022: 109%) of Benchmark EBIT to
Benchmark operating cash flow, and with
Benchmark free cash flow of US$1,109m
(2022: US$1,311m). The continued strength
of our Benchmark operating cash flow
performance reflects the nature of our low
capital intensity business and financial model,
and our attention to working capital
management.
Funding
The Group has ample liquidity and access
to considerable funding, with undrawn
committed bank borrowing facilities at
31 March 2023 of US$2.4bn (2022: US$2.6bn),
including our core US$1.95bn club facility,
committed until December 2025. Our
borrowing facilities ensure the Group has
sufficient funds available for operations and
planned growth.
The covenant on our banking facilities requires
that Benchmark EBIT should cover net interest
expense, excluding the effects of IFRS 16
‘Leases’, before financing fair value
remeasurements, by three times. At 31 March
2023, this ratio was 15 times (2022: 16 times).
We have no undue concentration of repayment
obligations in respect of borrowings and did
not breach any covenants given on borrowings
during the year under review or the prior year.
FY27 FY28 FY29 FY30 FY31 FY32 FY33
FY26
FY25
496
496
496
545
545
500
750
FY24
Bond maturity profile
US$m
31 March 2023
Debt profile
US$m
Short-term
debt <5%
(commercial
paper and
bank loans)
Long-term
debt >95%
(bonds and
bank loans)
3,973
108
Bond nominal value before derivatives.
31 March 2023
Bond currency
16%
15%
69%
A
B
C
C. USD
B. EUR
A. GBP
90%
67%
59%
38%
>2
years
>4
years
>6
years
>8
years
% of debt at fixed
interest rates
Currency split is after derivatives.
71
Experian plc
Annual Report 2023
Strategic report
Financial review
continued
Capital investment breakdown %
FY21
FY22
FY23
FY19
FY20
FY21
FY22
FY23
FY19
FY20
B. Infrastructure
C. Data
A. Development
Capex %
9
9
8
Capex US$m
A
B
C
487
439
422
8
508
Capital expenditure (capex)
as % of total revenue
34%
38%
36%
28%
31%
33%
35%
25%
40%
34%
21%
45%
9
627
30%
15%
55%
Our bonds, which represented 92% (2022: 96%)
of borrowings at 31 March 2023, totalled
US$3.8bn (2022: US$3.9bn), and had an
average remaining tenor of five years. We seek
to minimise refinancing risk in any given year,
with no bond refinancing required until
September 2024, and at 31 March 2023 55%
(2022: 57%) of borrowings fell due in over
five years.
We keep our debt levels stable at a low
multiple of our profits, commensurate with
maintaining strong investment-grade credit
ratings (BBB+/Baa1 or above). Our balance
sheet strength allows us to maintain access to
cost-effective sources of borrowing. Net debt
at 31 March 2023 was US$4,030m (2022:
US$3,950m), 1.8 times Benchmark EBITDA
(2022: 1.9 times), compared to our target range
of 2.0 to 2.5 times.
Disciplined capital management
We maintain a disciplined approach to capital
allocation, balancing organic and strategic
investments with shareholder returns through
dividends and share repurchases. The mix
between these categories varies over time,
and we assess acquisition opportunities
against a range of metrics, including economic
valuations and the earnings enhancement
we expect them to bring relative to share
repurchases. Our free cash flow has
consistently been strong, the foundation
of our disciplined allocation framework.
Further information on capital risk
management is provided in note 8(b) to the
Group financial statements on page 178.
We executed net share repurchases for a
cash consideration of US$175m, which mainly
offset deliveries during the year under
employee share plans. We expect to execute
purchases of up to US$150m in the coming
year.
Net investment of US$1,119m (2022:
US$1,167m) comprised cash flows for net
capital expenditure, acquisitions and net
investments.
Capital summary
US$m
*
Funds from operations is defined as Benchmark free cash
flow plus organic capital investment (capital expenditure).
Funds from
operations*
Increase in
Net debt and other
Acquisitions and minority
investments
0
1,600
1,200
800
400
2,000
Uses of cash
Cash generated
Dividends
Share repurchase programme
Organic capital investment
Experian plc
Strategic report
72
Year ended 31 March
2023
US$m
2022
US$m
Capital expenditure as reported in the Group cash flow statement
627
508
Disposal of property, plant and equipment
—
(23)
Profit on disposals of property, plant and equipment
—
4
Net capital expenditure
627
489
Acquisitions
480
781
Purchase of investments
15
32
Disposal of operations and investments
(3)
(23)
Distributions from investments
—
(2)
Repayment of promissory note and interest
—
(110)
Net investment
1,119
1,167
Reconciliation of net investment
Acquisitions focus on strategic growth
areas, new markets, or enhance our existing
business. We completed six acquisitions
in the year, for a cash consideration of
US$480m (2022: US$781m), including
that of CIC Plus, LLC, for US$188m,
supplementing our verification and
employer services offering in the USA.
We also purchased the remaining 40%
interest in the Experian DACH Joint Venture,
for US$133m.
In April 2023, we agreed to acquire Flexpag
Tecnologia e Instituição de Pagamento S.A.,
a Brazilian FinTech specialising in digital
payment solutions, for c.US$49m.
Disposals
We disposed of interests in two small
subsidiaries in EMEA/Asia Pacific in
connection with our restructuring
programme, realising a gain of US$2m.
In addition, further costs of US$3m were
incurred following our decision in FY22
to cease operations in Russia.
Acquisitions
CIC Plus
A leading provider of employer compliance
management solutions in the USA.
Pay Dashboard
A digital payslip portal in the UK,
strengthening our employer
services offering.
BillFixers
A provider of consumer bill negotiation
services in the USA, enhancing our premium
membership features.
Salary Finance Limited's Work Report
An employment verification solution
developed in partnership with Salary
Finance Labs in the UK.
Global AI software
Global software licence acquired.
APC Buró
We acquired a majority shareholding in this
leading credit bureau in Panama.
Capital expenditure
Our capital expenditure of US$627m (2022:
US$508m) was 9% (2022: 8%) of revenue,
and depreciation and amortisation charged
to Benchmark EBIT were 7% (2022: 8%) of
revenue. We anticipate that future organic
capital investment will continue to be in line
with our long-term range of 8% to 9% of total
revenue, as we invest to nurture growth,
re-positioning our business to maximise
competitive advantage.
Work Report.
Enabling employees to access and share their income and
employment data securely in real-time
Powered by
TM
Employment and income. Instantly from payroll.
73
Experian plc
Annual Report 2023
Strategic report
Financial review
continued
Associates and venture investments
Our investment in smaller start-ups and
FinTech companies enhances innovation and
the development of unique IP. During the year,
we completed seven deals, bringing our total
programme financing to US$287m in 35 active
venture companies.
Share capital and equity
The fair values of investments revalued
through Other comprehensive income (OCI),
and net post-employment benefit assets have
been impacted by macroeconomic factors, and
losses of US$58m and US$23m are recognised
in OCI, as are exchange losses of US$203m. In
FY22 exchange and remeasurement gains of
US$161m were recognised in OCI.
Our spend on net share repurchases was
US$175m (at an average price of 2,524p),
reducing the number of shares in circulation by
1.6m (0.17%). During the year, the average
number of shares in circulation was 914m
(2022: 914m) and the closing number of shares
at 31 March 2023 was 912m (2022: 914m).
Dividends and distributable reserves
Our dividend policy aims to pay dividends over
time broadly in line with the underlying growth
in Benchmark EPS, aligning shareholder
returns with our underlying profitability. Our
long-term record of profitability and strong
cash flow conversion has enabled us to pay
increasing dividends since listing in 2006.
In the last five years, we have paid ordinary
dividends of US$2.2bn.
The Board has announced a second interim
dividend of 37.75 (2022: 35.75) US cents per
ordinary share, giving a total dividend for the
year of 54.75 (2022: 51.75) US cents per share,
which is covered 2.5 times by Benchmark EPS
(2022: 2.4 times). Ordinary dividends paid in
the year amounted to US$482m (2022:
US$444m).
Experian plc, and the UK entity responsible for
distributing dividends under the Group’s
Income Access Share arrangements, have
significant distributable reserves, which at
31 March 2023 were US$19.2bn and US$8.6bn
respectively. See note L to the Company
financial statements for further detail.
0
50
100
150
200
250
300
350
400
450
500
FY23
FY22
FY21
FY20
FY19
FY18
FY17
FY16
FY15
FY14
FY13
FY12
FY11
FY10
FY09
FY08
FY07
US$m
First interim dividend
Second interim dividend
Full-year ordinary dividend
(US$m)
Year ended 31 March
2023
US$m
2022
US$m
2021
US$m
Goodwill
5,575
5,737
5,261
Other segment assets
4,265
4,193
3,756
Total segment assets
9,840
9,930
9,017
Segment liabilities
(2,273)
(2,297)
(2,043)
Operating segments – net assets
7,567
7,633
6,974
Central Activities – net assets
556
527
392
Lease obligations in operating segments
143
177
198
Interest on lease obligations in operating segments
(1)
(1)
(2)
Less: right-of-use assets
(128)
(153)
(172)
Less: non-controlling interests
(35)
(38)
(38)
Capital employed attributable to owners
8,102
8,145
7,352
Net debt
(4,030)
(3,950)
(4,026)
Tax
(271)
(379)
(417)
Add: right-of-use assets
128
153
172
Add: non-controlling interests
35
38
38
Net assets
3,964
4,007
3,119
Average capital employed
8,060
7,774
6,901
ROCE
1
16.5%
15.7%
14.9%
1
For definition of ROCE see ‘Non-GAAP measures’ on page 177. For FY23 the return used in the calculation of ROCE is based on
Benchmark EBIT of US$1,794m and a Benchmark tax rate of 26.0%.
Net assets and ROCE summary
Associates
Current invested
capital
Number of portfolio
companies
New deals closed
this year
US$12m
7
US$287m
35
7
–
US$299m
42
7
Venture
Total
Associates and venture investments
Experian plc
Strategic report
74
Return on capital
ROCE for FY23 and FY22 was 16.5% and 15.7%
respectively. Returns are affected by the timing
of acquisitions completed part way through
any given year. Acquisitions largely completed
early in FY23, contributing to the increased
return. ROCE is a post-tax measure and we use
our Benchmark tax rate for ease of calculation.
Further information on net assets by region
is given in note 10 to the Group financial
statements on page 182.
Financial risk management
The key financial risks specific to our business
are set out in the Risk management section on
pages 78 – 85. Our risk landscape continues
to change as both business and regulatory
environments evolve.
We continue to monitor inflationary and
geopolitical risks, including market volatility,
regulatory and tax policy uncertainty.
We have identified macroeconomic factors as
a principal risk, as we operate globally and our
results could be affected by global, regional or
national changes in fiscal or monetary policies.
Detailed narrative disclosures are contained
in note 8 to the Group financial statements
on pages 177 to 178, with further numeric
disclosures for foreign exchange, interest rate
and credit risk in notes 11, 16, 25 and 31
respectively.
Estimates and judgments
The Group is subject to a number of risks
and uncertainties that require us to make
estimates and judgments. Areas involving
significant uncertainty are:
Goodwill
Goodwill represents 51% of total assets.
We test for impairment of goodwill at least
annually by performing a value-in-use
calculation for each cash-generating unit
(CGU), which is based on cash flow projections
with assumptions. IAS 36 requires us to
disclose where a reasonably possible
movement in these key assumptions would
lead the calculated recoverable amount to be
equal to the carrying value. These estimates
are, by nature, subject to uncertainty and the
key assumptions used by each CGU, and
sensitivities for the EMEA and Asia Pacific
CGUs, are set out in note 21 to the Group
financial statements. Macroeconomic
conditions have contributed to a non-cash
impairment of EMEA goodwill of US$179m
in the year.
Useful life of intangible assets
Our business is subject to technological
change and competition. We currently
amortise non-acquisition intangibles over
a period from three to ten years, with the
average life being six years. If the useful life
of our databases and internal use or internally
generated software either increased or
decreased by one year, the impact on the
annual amortisation charge would be a
decrease of US$68m or an increase of
US$107m respectively.
Taxation
We are subject to tax in numerous jurisdictions
and have a number of open tax returns with
various tax authorities. It can take many years
to agree an outcome with a tax authority,
as there are transactions in the ordinary
course of business for which the ultimate
tax determination is uncertain. Our key
uncertainties relate to the deductibility of
purchased goodwill, inter-company trading
and financing. US$102m (2022: US$293m)
is included in current tax liabilities in relation
to these judgmental areas, down on FY22
following agreement of historical tax positions.
If the resolution of all these uncertainties was
ultimately adverse, we may be required to pay
an amount of up to US$24m (2022: US$151m)
in addition to that currently provided.
In addition, the Group is subject to challenge
by the Brazilian and Colombian tax authorities
on the deduction for tax purposes of goodwill
amortisation. The possibility of the claims
resulting in a liability to the Group is
considered to be remote. Further information
on this contingency is provided in note 46 to
the Group financial statements.
Deciding whether to recognise deferred tax
assets is a financial judgment. Assets are
recognised only when we consider it probable
that they can be recovered, based on forecasts
of future profits against which those assets
may be utilised.
Pensions
The Group is exposed to a number of risks
inherent in defined benefit pension plans, as
outlined in note 35(d) to the Group financial
statements. The principal financial assumption
used in determining the carrying value of
pension assets or obligations is the real
discount rate. If this rate increased or
decreased by 0.25%, defined benefit
obligations at 31 March 2023 would change
by approximately ± US$22m, offset by a
change in the fair value of plan assets of
approximately ± US$27m.
The 2022 actuarial valuation of the Group's
principal defined benefit plan has been agreed,
and there was a moderate funding surplus.
Litigation
There continue to be an increasing number of
pending and threatened claims and regulatory
actions involving the Group across all its major
geographies which are in various stages of
investigation or enforcement, and which are
being vigorously defended, including from the
Consumer Financial Protection Bureau and
Federal Trade Commission in the USA, and the
Information Commissioner’s Office in the UK.
We do not consider that the outcome of any
such claims will have a materially adverse
effect on our financial position.
FY22
15.7
FY21
14.9
FY20
16.1
FY19
15.9
FY23
16.5
ROCE
%
75
Experian plc
Annual Report 2023
Strategic report
Financial review
continued
Exceptional items and other
adjustments made to derive
Benchmark PBT
We make certain adjustments to derive
Benchmark PBT. These are summarised in
the table below. Note 7 to the Group financial
statements explains the reasons for the
exclusion from our definition of Benchmark
PBT of Exceptional items and other
adjustments made to derive Benchmark PBT.
Further information on Exceptional items is
provided in note 15 to the Group financial
statements on pages 187 to 188.
Non-GAAP measures
We have identified and defined certain
non-GAAP measures as the key measures
used by management to assess the underlying
performance of the Group’s ongoing
businesses.
As a result of our restructuring programme
in EMEA/Asia Pacific, we have refined the
definition of Exceptional items, to include
onerous global support costs associated
with the closure of significant operations,
to improve the assessment of underlying
operating performance as such costs are
eliminated through restructuring activity.
The table opposite summarises these
measures, and there is a fuller explanation
in note 7 to the Group financial statements
on pages 175 to 177.
Year ended 31 March
2023
US$m
2022
US$m
Exceptional items:
Net loss on disposal of operations
1
43
Net profit on disposal of associates
(1)
(90)
Restructuring costs
53
20
Onerous global support costs
16
—
Legal provisions movements
(3)
6
Net charge/(credit) for Exceptional items
66
(21)
Other adjustments made to derive Benchmark PBT:
Amortisation of acquisition intangibles
192
174
Impairment of goodwill
179
—
Acquisition and disposal expenses
46
47
Adjustment to the fair value of contingent consideration
45
26
Non-benchmark share of post-tax loss of associates
18
31
Interest on uncertain tax provisions
1
(1)
Financing fair value remeasurements
(51)
(168)
Net charge for other adjustments made to derive Benchmark PBT
430
109
Net charge for Exceptional items and other adjustments made to
derive Benchmark PBT
496
88
Benchmark PBT
Profit before amortisation and impairment charges, acquisition expenses,
Exceptional items, financing fair value remeasurements, tax (and interest
thereon) and discontinued operations. It includes the Group’s share of
continuing associates’ Benchmark post-tax results.
Benchmark EBIT
Benchmark PBT before net interest expense.
Benchmark EBITDA
Benchmark EBIT before depreciation and amortisation.
Exited business activities
The results of businesses sold, closed or identified for closure during
a financial year.
Ongoing activities
The results of businesses that are not disclosed as exited business activities.
Constant exchange rates
Results and growth calculated after translating both years’ performance
at the prior year’s average exchange rates.
Total growth
The year-on-year change in the performance of Experian's activities at actual
exchange rates.
Organic revenue growth
The year-on-year change in the revenue of ongoing activities, translated
at constant exchange rates, excluding acquisitions until the first anniversary
of their consolidation.
Benchmark earnings
Benchmark PBT less attributable tax and non-controlling interests.
Total Benchmark earnings
Benchmark PBT less attributable tax.
Benchmark EPS
Benchmark earnings divided by the weighted average number of ordinary
shares.
Exceptional items
Those arising from the profit or loss on disposal of businesses, closure costs
of significant operations (including associated onerous global support costs),
costs of significant restructuring programmes, and other financially
significant one-off items.
Benchmark operating
cash flow
Benchmark EBIT plus amortisation, depreciation and charges for
share-based incentive plans, less net capital expenditure and adjusted for
changes in working capital, principal lease payments and the Group’s share
of the Benchmark profit or loss retained in continuing associates.
Cash flow conversion
Benchmark operating cash flow expressed as a percentage of Benchmark
EBIT.
Net debt and Net funding
Net debt is borrowings (and the fair value of derivatives hedging borrowings)
excluding accrued interest, less cash and cash equivalents. Net funding is
borrowings (and the fair value of the effective portion of derivatives hedging
borrowings) excluding accrued interest, less cash held in Group Treasury.
Return on capital
employed (ROCE)
Benchmark EBIT less tax at the Benchmark rate divided by average capital
employed, in continuing operations, over the year. Capital employed is net
assets less non-controlling interests and right-of-use assets, plus or minus
the net tax liability or asset and plus Net debt.
Exceptional items and other adjustments made to derive Benchmark PBT
Non-GAAP measures
Experian plc
Strategic report
76
Verify
Millions of mortgages are applied for
and approved every year in the USA.
It is one of the biggest, most stressful
financial decisions a person can make.
All being well, it enables them to
eventually own the home they live in
and lay the foundation for building
wealth over time. Mortgages have
been greatly beneficial to many, with
over 65% of Americans now owning
their own home. For lenders, they
represent a valuable source of fixed
income, allowing them to plan for the
growth of their companies efficiently.
Given the amounts of money involved,
applicants must provide proof of
income and job stability. This helps
give lenders a view of a consumer's
capacity to repay the mortgage. But it
can take days or even weeks for a
loan officer to receive the consumer’s
pay slips, slowing down the process
and adding stress for the consumer.
With millions of trusted employer
payroll records, Experian Verify can
automate this process. It uses
real-time data, on a flexible platform
that can be tailored to each client’s
unique needs.
It enables decisions to be made in
seconds, securely, reducing stress
for consumers. It also reduces risk
for lenders with more accurate and
up-to-date information, reduces
their costs and provides a more
comprehensive view of a consumer’s
financial health. This enables lenders
to say yes to more borrowers.
Lenders saying yes to more borrowers
Access to
information is a crucial part of the mortgage lending process.
accurate and reliable
Michele Bodda
President, Experian Housing,
Verification Solutions and Employer Services,
Experian North America
Lenders also have peace of mind knowing
Experian Verify supports income and
employment validation from the US
Government Sponsored Enterprises (GSEs).
77
Experian plc
Annual Report 2023
Strategic report
Risk management and principal risks
Identifying and managing risk
Identifying and managing risk is key to our purpose and the delivery of our strategy and objectives. All colleagues
play a crucial role in managing risks, and doing so helps us create long-term shareholder value and protect our
business, people, assets, capital and reputation.
Our risk management governance structure
Board
Audit Committee
Executive Risk Management Committee (ERMC)
Group Operating Committee (OpCo)
Executive management
Risk Management and Governance Committees
Security and
Continuity Steering
Committee (SCSC)
is a sub-committee of
the ERMC. Its primary
responsibility is to
oversee management
of global information
security, physical security,
and business continuity.
Tax and Treasury
Committee
oversees management of
financial risks, including
tax, credit, liquidity,
funding, market and
currency risks.
Global and Regional
Strategic Project
Committees
ensure that we
appropriately resource
our strategic projects, that
they are risk-assessed,
and commercially and
technically appraised. The
committees' conclusions
are then considered by
the Board or relevant
Group Principal Operating
Subsidiary.
Regional Risk
Management Committees
(RRMCs)
oversee management of
regional risks and feed up
to the ERMC.
Environmental, Social
and Governance (ESG)
Steering Committee
ensures the definition,
approval and integrated
delivery of the Group's
ESG strategy, and is
chaired by the Chief
Financial Officer.
Sets our overarching risk appetite and ensures that we manage risks appropriately across the
Group. The Board delegates oversight of risk management activities to the Audit Committee.
Regularly monitors the principal risks and uncertainties identified by our risk assessment
processes, with the strategies we have developed and the actions we have taken to mitigate them.
The Committee also continually reviews the effectiveness of our risk management and internal
control systems, which support our risk identification, assessment and reporting.
Comprises senior Group executives, including the executive directors and the Company Secretary.
It oversees how we manage global risks. This committee and the risk committees mentioned
below each meet multiple times a year.
The Group Operating Committee comprises our most senior executives. Its remit includes
identifying, debating and achieving consensus on issues involving strategy, risk, growth, people
and culture, and operational efficiency. Its meetings generally focus on the key issues facing
our Group.
Our executive management takes day-to-day responsibility for implementing the Board’s policies
on risk management and internal control. It designates who is responsible and accountable
through the design and implementation of all necessary internal control systems, including
policies, standards and guidance.
Experian plc
Strategic report
78
a
Lines of business (regional and global)
a
Experian IT Services (EITS)
a
Corporate functions
a
Global Risk Management
a
Global Security Office
a
Legal
a
Compliance
a
Business Continuity
a
Physical Security
a
Group Finance
a
Global Internal Audit
The Board is responsible for maintaining
and reviewing the effectiveness of our risk
management activities from a strategic,
financial, regulatory and operational
perspective. These activities are designed to
identify and manage, rather than eliminate,
the risk of failing to achieve our business
objectives or strategy. The risk management
process (see diagram below) is designed to
identify, assess, respond to, report on and
monitor the risks that threaten our ability
to do this, within our risk appetite.
We apply both bottom-up and top-down
approaches to the management of risk.
Bottom-up risk management processes,
operating at a business unit or country level,
provide visibility of risks and issues across the
business. These risks and issues are assessed
and reported to relevant risk management
committees at a regional and global level.
Our top-down approach involves senior
management at a global level and identifies
the principal and emerging risks that threaten
achieving our strategy. This ensures that our
risk response is appropriate.
We follow the Three Lines of Defence approach
to risk management (see diagram below).
Risks are owned and managed within the
business (first line of defence) and reviewed
by our businesses at least quarterly. Global
governance teams (from the second line of
defence) provide oversight and challenge
of the management of risks and controls,
including those relating to information security,
compliance and business continuity. Global
Internal Audit, as the third line of defence,
assesses our risks and controls independently
and objectively. The results of this oversight
and review process feed into our reporting
cycle through the risk management
governance structure.
Risk categories
We adopt a risk category approach to reporting
risk within the Group. The risk categories
reflect the overall purpose, strategy and
business model for the Group, and recognise
both the external context and our internal
operating environment. Risk categories
provide the foundation for the reporting
of all risks within the Group.
Strategic risk
–
Country/political/economic
–
Acquisitions
–
Competitor
–
Business strategy
–
Publicity
Financial risk
–
Accounting
–
Credit
–
Liquidity
–
Market
Regulatory/compliance risk
–
Regulated activities
–
Data privacy
–
Financial crime
–
Conduct
–
Regulatory change
–
Licences and permissions
Operational risk
–
Technology
–
Information security
–
Physical security
–
Business continuity
–
Data quality
–
Third party
–
People
–
Process
Our risk management process
Three Lines of Defence
Audit Committee
Executive management / Risk Management Committees
First Line of Defence
Second Line of Defence
Third Line of Defence
All employees have First Line
responsibilities
Governance teams have Second Line
responsibilities
Global Internal Audit has Third Line
responsibilities
a
Identify key business objectives
a
Identify principal and emerging
risks
a
Identify key controls
a
Assess risk drivers and controls
a
Estimate likelihood and impact
considering financial, consumer,
people, reputational, legal and
regulatory impacts
a
Quantify the risk
a
Accept or remediate current
risk and control environment
a
Determine corrective action if
needed
a
Business unit and regional level
a
RRMCs and ERMC
a
Audit Committee
Step 1: Risk identification
Step 2: Risk assessment
Step 3: Risk response
Step 4: Risk reporting
and monitoring
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Risk appetite
The Board sets our overarching risk appetite
for the principal risks we face across our risk
categories in the normal course of business.
We assess the level of risk against the risk
appetite, to ensure we focus our efforts
appropriately. We target risks for assessment
based on gross risk, and measure them based
on net risk, using a risk and control
assessment methodology. We then prioritise
them for mitigation. The Board and Audit
Committee review the principal and emerging
risks on an ongoing basis, as does the ERMC.
We use a variety of information sources to
show whether we are working within our
tolerance for these risks, and whether or not
any of them require additional executive
attention.
Our risk culture
The Board is committed to maintaining a
culture that emphasises the importance of
managing risk, and encourages transparent
and timely risk reporting. We work to align
employees’ behaviour, attitudes and incentives
with our risk appetite and with our risk
management and other governance policies.
Our risk governance process reinforces
and facilitates appropriate ownership,
accountability, escalation and management
of our principal and emerging risks. This
process includes: well-defined roles and
responsibilities across our Three Lines of
Defence model; assigning accountability for
taking risks when making key business
decisions; documenting clear boundaries
and behavioural expectations in policies and
standards, such as within the Group’s Code of
Conduct; and creating an environment that
reinforces adherence and accountability. Our
governance structure is designed to be agile in
both managing existing risks and reacting to
any newly identified risks. Principal and
emerging risks are discussed in one or more
of our governance forums, and we hold ad hoc
meetings when needed, to quickly assess and
determine appropriate risk responses.
Current areas of focus
Our risk landscape continues to change as
both business and regulatory environments
evolve.
Last year we completed an external review of
our operational risk management programme.
We reported that, in response, we had initiated
a transformational project and during the year
we have made substantial progress in
implementing the recommendations in the
review. In particular, we have improved the
way we quantify and assess the severity of our
key risks, improved the way we assess and
monitor our emerging risks, and adopted a
new action-driven response based on four
new risk response categorisations: Improve/
Influence, Assure, Monitor and Optimise. We
also enhanced our internal risk governance
and reporting arrangements and made a
number of new appointments as we continue
to build our risk management capability.
In addition, each of the second line functions
carried out a strategic review with the aim of
developing an integrated set of strategic plans
across the second line to harmonise our
overall risk management process. As part of
the strategic review, we assessed the maturity
of our processes across the second line of
defence and our strategic plans set a clear
path to deliver an assured maturity level
across Risk, Information Security and
Compliance. For further details, see the
Audit Committee report, page 113.
We expect to continue to make further
progress on delivering our strategic plan and
further maturing our overall risk management
approach through FY24.
Emerging risks
We have made improvements to our emerging
risk processes to identify and assess risks that
may, in time, pose a threat to our business
model or strategy. This horizon scanning
exercise seeks to identify potential risks and
emerging trends, looking through various risk
lenses and over a future time horizon, in some
cases extending up to five years and beyond.
This approach enables the consideration of the
most relevant emerging risks and
opportunities for Experian and provides
the opportunity to review and develop
appropriate risk response strategies to
address them. Some of the emerging risks
we are currently monitoring include:
a
Artificial intelligence (AI) and advancing
technologies:
Using AI and other advanced
technologies to automate a range of
operational tasks helps Experian stay
competitive in a rapidly evolving market and
keep up with consumer demands. However,
the increasing use of AI and machine learning
may pose risks related to, for example,
security, change management and to the
accuracy and completeness of data and
related models. Therefore, we must ensure
that our approach to the use of these
technologies follows our strong risk
management and governance processes and
is compliant with regulatory requirements.
For example, we have recently established a
new process to assess the emerging risks
and opportunities of Generative AI tools
across our business operations.
a
Geopolitical instability:
Geopolitical risk
is being monitored due to the increasing
complexity of international relations and
rise of nationalism and populism. With
operations in 32 countries, Experian needs
to regularly review and update its strategy
to mitigate potential impact and uncertainty
from geopolitical developments including:
the war in Ukraine; hardening of technology
blocs as a result of trade and investment
controls; relations between China and
Western countries; and the shifts in political
power in Latin America.
Climate-related risks
We recognise climate change as one of the
most critical issues facing global society. The
main climate-related risks affecting the Group
relate to: how physical risks such as flooding,
damage from hail, and freeze damage, could
cause disruption to our business operations;
and the risks posed by the transition to a
low-carbon economy, such as climate change
regulation and any failure to adapt our
products and services in markets most
affected by this change. Climate risk has
implications relating to several of our existing
risk categories (and related principal risks),
and we recognise we need a range of risk
responses. We continue to monitor, assess and
manage these risks using our established
four-step risk management processes. These
risks, and our response to them, are overseen
by our ESG Steering Committee. For example,
this year, our insurance providers have
undertaken climate engineering surveys at our
key operational sites to help us understand
what further actions we can take to strengthen
our climate resilience. Making continued
progress towards our science-based emission
reduction target – including through energy
efficiency – helps mitigate risk associated with
potential future carbon pricing and increased
energy costs. Our approach to Scope 3
reporting and supplier engagement reduces
exposure to carbon taxation on purchased
goods and services, which make up most of
our value chain carbon footprint. The
Committee has developed a strategy to
manage the ongoing climate-related and other
ESG risks as they present themselves and we
continue to embed these within our existing
risk management approach. Further detail on
how we have incorporated climate-related
risks into our risk management process is
available in the Sustainable business section
(page 40).
Principal risks
The following pages summarise our principal
risks and uncertainties, with mitigating actions
for each, and related trends in the risk
environment, as identified by the Board for the
year ended 31 March 2023. The Board has
made revisions to the nature and definitions of
these risks when compared with prior years:
consolidated two, and updated and refined
others. These risks may continue to change
during the next financial year as the risk
landscape evolves and emerging risks
continue to develop.
Risk management and principal risks
continued
Experian plc
Strategic report
80
While we operate in a rapidly evolving legal,
regulatory and technological landscape and
a level of uncertainty remains in the
geopolitical environment, in the second half
of the financial year we have seen risk trends
stabilising.
To assess our Group’s viability, the directors
focused on three principal risks critical to our
success. These are summarised below and
discussed in more detail in the viability
assessment section following the description
of our principal risks.
a
Data loss/misuse leading to serious
reputational and brand damage, legal
penalties and class action litigation.
a
The uncertainty surrounding the geopolitical
and macroeconomic environment, in
particular increased inflation and the raising
of interest rates.
a
New legislation or changes in regulatory
enforcement changing how we operate our
business.
Data loss/misuse
We hold and manage sensitive business,
customer and consumer information that
increases our exposure and susceptibility to
cyber attacks or other unauthorised access
to data, either directly through our online
systems or indirectly through our partners
or third-party suppliers.
This risk is considered in the viability
assessment.
Risk category
Risk movement
Operational
Stable
Potential impact
Loss or unauthorised access to sensitive
business, customer or consumer data could
cause problems for consumers, result in
material loss of business, substantial legal
liability, regulatory enforcement or significant
harm to our reputation. The impact of this risk,
if it materialised, would typically be felt in the
short term.
Examples of control mitigation
a
We deploy physical and technological security
measures, combined with monitoring and
alerting for suspicious activities.
a
We maintain an information security
programme with strong governance for
identifying, protecting against, detecting and
responding to cyber security risks and
recovering from cyber security incidents.
a
We impose contractual security
requirements on our partners and
other third parties that use our data,
complemented by periodic reviews
of third-party controls.
a
We maintain insurance coverage, where
feasible and appropriate.
Responsibility
Our Global Security Office sets policies and
standards related to the information security
programme. Every employee is responsible
for following security policies and protocols,
supported by a strong emphasis on training
and awareness.
Changes this year
External cyber security threats to businesses
continue to increase in complexity and evolve
in their nature and scope. Our threat-informed
defence programme concurrently monitors
and targets the most active threats to mitigate
and reduce risks. As our business continues to
change through both acquisitions and
technological developments, we remain
focused on the continuing need to survey the
internal and external threat landscape and
develop responses that support our strategy to
manage the risk.
Our security programme continues to improve
its maturity relative to industry frameworks
(e.g. US National Institute of Standards and
Technology), and we have further enhanced
our protection, detection and response
capabilities by strengthening security policies,
practices and training. We also ensure that we
apply them consistently across our regions
and business units. We will continue investing
in the tools, people, resources and initiatives
necessary to maintain and improve our global
information security programme.
More information on our approach to treating
data with respect is available in our
Sustainable business section (page 45).
Macroeconomic
We operate globally and our results could be
affected by global, regional or national changes
in fiscal or monetary policies.
A substantial change in credit markets in the
USA, Brazil or the UK could harm our financial
performance and growth potential in those
countries.
A substantial or sustained rise in US, EU or UK
interest rates could impact lending and
consumer spending. It could also increase our
future cost of borrowings.
We present our Group financial statements in
US dollars. However, we transact business in a
number of currencies. Changes in other
currencies relative to the US dollar affect our
financial results.
This risk is considered in the viability
assessment.
Risk category
Risk movement
Financial
Stable
Potential impact
The USA, Brazil and UK markets are significant
contributors to our revenue.
A reduction in one or more of these markets
for consumer and business credit services
could reduce our revenue and profit.
We benefit from the strengthening of
currencies relative to the US dollar and are
adversely affected by currencies weakening
relative to it.
We have outstanding debt denominated
principally in euros, pounds sterling and US
dollars. As this debt matures, we may need to
replace it with borrowings at higher interest
rates.
The impact of this risk, if it materialised, would
typically be felt in the short to long term.
Examples of control mitigation
a
We have a diverse portfolio by region,
product, sector and client. We provide
cyclical and counter-cyclical products and
services.
a
We convert cash balances in foreign
currencies into US dollars.
a
We fix the interest rates on a proportion of
our borrowings.
a
We review contingency plans in our key
markets for specific potential responses to
evolving financial conditions.
Responsibility
Our corporate and business unit finance
functions monitor our external landscape,
and work with business units to develop and
implement appropriate responses.
Changes this year
During 2022, the global economy saw a more
moderate performance when compared to the
2021 rebound (6.1% growth), with the global
Gross Domestic Product (GDP) growing 3.1%
(at March 2023). The forecasts show a decline
in GDP for the UK in 2023, with modest growth
expected in 2024. 2023 GDP expectations in
our largest market, the USA, are expected to
be flat versus 2022, with low growth expected
in 2024. Overall, global GDP is expected to
remain positive with growth expected in 2023.
Elevated inflation rates continue to exist in the
market compared to historical levels. Factors
such as the impact of inflation on our base
payroll cost and technology spend as well as
other issues such as supply chain pressures
could lead to higher operating costs. We
monitor cost pressure points to mitigate
inflation and maintain a focus on cost
management and efficiency.
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Despite the softer macroeconomic backdrop
and tightening in lending criteria by some
clients, we continue to perform well
competitively and access higher growth
opportunities with a very substantial quantum
of addressable opportunity. Businesses
continue to need to generate productivity gains
while delivering better digital experiences for
their customers and our rich datasets, which
are delivered through some of the world’s
most technologically advanced solutions,
enable them to do this.
We continue to analyse the impact of changes
in economic conditions on Group revenues and
have considered different economic scenarios
in our viability assessment. We will continue to
refine and assure the readiness of our
strategic options if the external
macroeconomic factors have a bigger impact
on our performance.
While we continue to monitor new and evolving
legislation relating to tax, this risk has reduced
in the year due to a reduction in the number of
open tax enquiries. In the last six months the
range of external macroeconomic factors have
moderated their rate of change and so we
assess our macroeconomic risk movement as
broadly stable.
Legislative/regulatory change
and compliance
We hold and manage sensitive consumer
information and we must comply with many
complex privacy and consumer protection
laws, regulations and contractual obligations.
New laws, new or novel interpretations of
existing laws, changes to existing regulations
and heightened regulatory scrutiny, will also
affect how we operate. For example,
regulatory interpretation of complex,
principles-based privacy regulations could
affect how we collect and process information
for marketing, risk management and fraud
detection.
This risk is considered in the viability
assessment.
Risk category
Risk movement
Strategic
Regulatory
Operational
Stable
Potential impact
Non-compliance may result in material
litigation, including class actions, as well as
regulatory actions. These could result in civil
or criminal liability or penalties, damage to our
reputation or significant changes to parts of
our business. We may also suffer increased
costs or reduced revenue resulting from
modified business practices, adopting new
procedures, self-regulation or litigation or
regulatory actions resulting in liability, fines or
changes in our business practices. The impact
of this risk, if it materialised, would typically be
felt in the short to long term.
Examples of control mitigation
a
We maintain a compliance management
framework that includes defined policies,
procedures and controls for Experian
employees, business processes, and third
parties such as our data resellers.
a
Our global Compliance team has
region-specific regulatory expertise and
works with our businesses to identify and
adopt balanced compliance strategies.
a
We assess the appropriateness of using
data in new and changing products and
services.
a
We operate a horizon scanning process to
identify potential changes in laws and
regulation and assess their impact.
a
Our Government Affairs strategic plan and
policy-influencing activity seeks to respond
to legislative proposals and influence their
outcome to mitigate impacts on Experian
strategy.
a
We vigorously defend all pending and
threatened claims, employing internal and
external counsel to manage and conclude
such proceedings effectively.
Responsibility
Our Legal, Government Affairs and Compliance
functions work with our business units to
understand the impact of relevant laws and
regulations, including any regulatory
interpretations and associated implications.
Our business units put in place appropriate
procedures and controls designed to ensure
compliance.
Changes this year
We have faced continued heightened
regulatory scrutiny, and regulatory and
government enquiries and investigations in
several jurisdictions. The laws and regulations
to which we are subject are complex,
principles-based, and may be subject to
interpretations, which can lead to actual and
potential differences in how regulations are
now interpreted and enforced in many of the
jurisdictions in which we operate. In some
cases these differences in interpretations may
have to be decided in the courts. We highlight
some significant updates below:
a
In the USA, the Consumer Financial
Protection Bureau (CFPB) conducts regular
and ongoing supervisory examinations of
various aspects of our credit reference
business. The CFPB has increased its
supervisory and enforcement activities
generally in the financial services industry,
with a focus on accuracy, fairness, financial
inclusion and anti-discrimination. During
2021, among other matters, the CFPB
conducted supervisory examinations
relating to our consumer-facing dispute
resolution processes for credit reports and
to Experian Boost. The CFPB has referred
the results of these examinations to their
Enforcement Division for investigation. We
have responded to various data requests on
these matters over the past year.
a
The US Federal Trade Commission (FTC) has
also generally increased its regulatory
activities in a number of areas that may
impact the financial services industry,
including marketing, competition, privacy
and other consumer-facing regulations.
During the year the FTC has also alleged
certain violations of law relating to Experian
Consumer Services' practices for emailing
its membership base. Experian intends to
continue to fully co-operate with our
regulators and, where necessary, vigorously
defend our practices.
a
Some US state privacy laws have come into
effect, with laws in additional states to
follow throughout the year, as well as
ongoing rulemaking under those laws now
in effect. A number of other states have
privacy laws under consideration and are
expected to enact privacy laws before
a national privacy standard may be
established, if at all. In the meantime,
divergence in state laws may have an
impact on products and services, as well
as on compliance regimes.
a
Over the past year, the number of US class
action lawsuits has remained steady,
however individual consumer cases are
trending up. While we are managing the
effects associated with these investigations
and lawsuits, the costs of responding to the
increased regulatory scrutiny and defending
litigation are rising and consequently the
risk of potential liability and impact on some
parts of our business remains significant.
a
In Brazil, the general data protection law
(LGPD) has been effective since September
2020. The LGPD may have an impact on how
businesses operate in certain markets,
including marketing services. In addition, the
LGPD created the Brazilian National Data
Protection Authority (the ANPD), which
exercises certain roles of education,
enforcement, investigation, and regulation,
including the determination of rules and
interpretation of data protections laws.
While we have implemented our rigorous
compliance programme based on the
principles outlined in the law, we have
already seen some different regulatory
interpretations of these principles and
how they relate to our Marketing Services
business. The Federal District public
prosecutor filed a class action against
Serasa Experian, alleging violations to the
LGPD in failing to obtain consumer consent
Risk management and principal risks
continued
Experian plc
Strategic report
82
prior to disclosing and using personal data
for marketing purposes in two specific
solutions. A final decision has been issued,
accepting the legitimate interest as a legal
ground but requiring a high level of
transparency regarding the use of
consumers' data. We are no longer providing
those two marketing solutions.
a
In the UK, the Government has published an
updated version of the Data Protection and
Digital Information Bill that now reflects its
ambitions to tailor the UK’s data protection
framework to UK needs – in particular to
encourage economic growth and innovation
through use of data in balance with privacy
protection. The Government aims for the Bill
to be passed this year. The UK Financial
Conduct Authority (FCA) has published an
interim report as part of their Market Study
into the Credit Information sector. The report
proposes improvements to how data
sharing is governed and how good
outcomes are achieved for consumers in
the use of credit data. Experian remains
engaged with the FCA and will consult
further as appropriate. The FCA’s new
Consumer Duty rules must be implemented
by July 2023. These will require firms to act
to deliver good outcomes, including fair
value for consumers, where it has material
influence on those outcomes. We have a
defined implementation plan and
programme to meet the timelines. We have
continued to see close supervision by the
FCA around compliance with their rules
and principles, particularly relating to the
importance of the role of credit reference
agencies to the financial services industry
and responsibilities to those whose data is
held on our bureaux. Their focus continues
to be on financial liquidity, operational
resilience, cyber and operational risk.
a
In the UK, in February 2023, Experian’s
appeal to the First Tier Tribunal against the
Information Commissioner's Office (ICO)
Enforcement Notice from 2018 was
substantially successful. The Tribunal set
aside the eight requirements from the ICO’s
Enforcement Notice. It issued a substitute
enforcement notice which contained the
requirement that if Experian continues to
use data from certain public data sources,
it must notify those whose data has been
received only from those public data
sources of its data processing. In line with
its public statements, the ICO is appealing
the decision and we expect the hearing of
that appeal to take place in the latter part of
2023. The substitute enforcement notice is
stayed pending the outcome of the appeal.
a
In the EU, the European Commission
published its proposal for the Artificial
Intelligence Regulation. We are actively
involved through our European industry
trade body (ACCIS) and through additional
efforts to shape the development of the
legislative process to minimise risk to our
business. There are pending cases in the
European Union Court of Justice whose
outcome could have a potential negative
impact on our business: the case SCHUFA
Holding and Others (Scoring), C-634/21
could lead to the need to obtain an
individual’s validly given consent to create a
credit score; the cases SCHUFA Holding and
Others ('Libération de reliquat de dette'),
C-26/22 and C-64/22 could shorten the data
retention periods for data collected from
public registries.
a
In Spain, a ministerial order was issued in
July 2020 which has the potential to lead to a
public credit registry. One impact would be
that banks would not be required to share
positive data with private bureaux, which in
turn will limit access to positive data for
non-bank lenders, thus maintaining their
market concentration. We launched a
judicial review against the ministerial order
in September 2020. The first instance
judgment for the court upheld the order and
we launched an appeal to the Supreme
Court. We expect a decision in 2024.
a
In South Africa, bureaux either require prior
authorisation or an approved industry Code
of Conduct to process data under the
Protection of Personal Information Act
(POPIA). The industry Code of Conduct has
been approved and published by the
Information Regulator. The Government
announced its exploration of the
establishment of a static public credit
register for reporting purposes under the
National Credit Act (NCA). If the register
includes all data, there is a risk that the
static register can be converted into another
competing bureau in the market.
a
In Australia, the Attorney General’s Office
released 116 proposals that may form the
basis of new privacy regulation in Australia.
Key proposals deal with issues around
consent which is likely to impact our
targeting business.
a
In India, the Reserve Bank of India (RBI) has
announced a draft bill to establish a National
Financial Information Registry. The RBI has
long proposed a public credit registry and
Experian continues to monitor the proposed
requirements.
Resiliency
Delivery of our products and services depends
on a number of key IT systems and processes
that expose our clients, consumers and
businesses to serious disruption in the event
of systems or operational failures.
Risk category
Risk movement
Operational
Stable
Potential impact
Failure to manage service availability and
enterprise resiliency and its impact on clients
and/or consumers within established risk
tolerance levels could have a materially
adverse effect on our business, financial
performance, financial condition and
reputation. The impact of this risk, if it
materialised, would typically be felt in the
short term.
Examples of control mitigation
a
Our operations are designed to avoid
material and sustained disruption to our
businesses, clients and consumers.
a
We design applications to be resilient and
with a balance between longevity,
sustainability and speed.
a
We maintain a global integrated business
continuity framework that includes
industry-appropriate policies, procedures
and controls for all our systems and related
processes, as well as ongoing review,
monitoring and escalation activities.
a
We maintain back-up data centres.
Responsibility
Our corporate and business technology teams,
assisted by the Business Continuity function,
are responsible for maintaining appropriate
primary and back-up infrastructure to
minimise disruption.
Changes this year
Throughout the year we experienced isolated
events that tested our plans and processes.
We continue to closely monitor our
infrastructure and processes to manage our
commitments to clients, consumers and
regulators.
Migrating to the cloud presents an opportunity
to simplify the scale and complexity of our
product portfolio and technical estate as
reduced complexity drives down cost and
increases reliability. We are adopting a
strategic 'cloud first' model with consolidated,
cloud-adjacent co-located data centres.
This creates strategically configured services,
organised across regions and availability
zones, ensuring greater resilience.
In common with many organisations, Experian
faces a continued threat from ransomware
and other cyber attacks. We continue to assess
the potential impact of these threats as the
nature and sophistication of these attacks
continually evolves. Our global ransomware
preparedness and associated response
includes a number of key initiatives aimed at
continually improving our existing capability in
this area.
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Continued uncertainty driven by geopolitical
volatility is driving focus on supply chain/
operational resiliency. We continue to see
longer lead times for procurement of
technology.
A global initiative continues progress to
maximise business value and maintain
leadership through accelerated technology
transformation delivering standardised
enterprise services and automating
'Everything as Code' to sustain delivery at
scale. The benefits of this are to create
increasingly sophisticated automation and
monitoring leading to a reduction in the time
taken to detect and resolve issues.
Business conduct
At Experian, we place the utmost importance
on operating with honesty, integrity and high
ethical standards. And we are committed to
maintaining the highest level of
professionalism in the conduct of our business.
Risk category
Risk movement
Operational
Stable
Potential impact
Failure to conduct our business operations in
an appropriate manner could adversely affect
our clients, consumers or counterparties.
The impact of this risk, if it materialised, would
typically be felt in the short term.
Examples of control mitigation
a
We enforce our Global Code of Conduct,
Anti-Corruption Policy, and Gifts and
Hospitality Policy. If we believe employees
or suppliers are not following our conduct
standards, we will investigate thoroughly
and take disciplinary action where
appropriate.
a
Experian operates a Confidential Helpline for
anyone who needs to raise a concern about
our conduct. This is facilitated by an external
provider and managed by Global Internal
Audit.
Responsibility
Our Group Risk and Compliance functions set
policies and standards, including the Global
Code of Conduct. All employees are
accountable for understanding and following
our policies and conduct standards.
Changes this year
Regulators have continued to put public trust
and consumer and investor protection at the
centre of their mission statements and have
promoted prudent conduct risk management.
Our periodic employee surveys provide a clear
understanding of our approach to professional
and ethical standards as well as ensuring that
all employees know exactly what’s expected of
them individually. We continue to see strong
scores in our conduct questions in these
surveys and our people continue to attest to
our Code of Conduct.
We regularly evaluate our policies and related
procedures to ensure that we stay up to speed
with external and internal expectations.
Talent acquisition and retention
Our success depends on our ability to attract,
motivate and retain key talent while also
building future leadership.
Risk category
Risk movement
Operational
Decreasing
Potential impact
Not having the right people could materially
affect our ability to innovate our products,
service our clients and grow our business.
The impact of this risk, if it materialised, would
typically be felt in the medium term.
Examples of control mitigation
a
In every region, we have ongoing
programmes for recruitment, personal and
career development, and talent identification
and development.
a
As part of our strategy, we conduct periodic
employee surveys. We track progress on
our action plans.
a
We offer competitive compensation and
benefits, and review them regularly.
a
We monitor attrition rates, with a focus on
individuals designated as high talent or in
strategically important roles.
Responsibility
Our business units work with the Human
Resources function to set and implement
talent management strategies.
Changes this year
We continue to effectively manage our ability to
attract, develop and retain employee talent.
The external talent market risk is reducing,
with considerable reductions in volatility of
attrition rates and acquisition timelines,
created previously by heightened activity
following the COVID-19 pandemic and the large
technology companies’ hiring activities. As the
external market volatility has reduced, attrition
rates in Experian overall and across key skill
categories have also reduced.
We continue to be attractive as an employer,
with clear positioning around our brand and
culture, along with our approach to diversity,
equity and inclusion, and have developed a
reputation as a sought-after organisation to
work for.
We monitor employee engagement through a
variety of channels and continue to implement
the action plans from our periodic surveys.
In addition to high response rates, our latest
surveys continue to show strong engagement,
enablement and leadership scores.
Further information on our people agenda is
available in our Sustainable business section
on pages 51-53.
Competition
We operate in dynamic markets such as
business and consumer credit information,
decisioning software, fraud, marketing, and
consumer services. Our competitive landscape
is still evolving, with traditional players
reinventing themselves, emerging players
investing heavily and new entrants making
commitments in new technologies or
approaches to our markets. There is a risk that
we will not respond adequately to such
disruptions, or that our products and services
will fail to meet changing client and consumer
preferences.
Risk category
Risk movement
Strategic
Stable
Potential impact
Price reductions may reduce our margins and
financial results. Increased competition may
reduce our market share, harm our ability to
obtain new clients or retain existing ones,
affect our ability to recruit talent, and influence
our investment decisions. We might also be
unable to support changes in the way our
businesses and clients use and purchase
information, affecting our operating results.
The impact of this risk, if it materialised, would
typically be felt in the long term.
Examples of control mitigation
a
We continue to research and invest in new
data sources, analytics, technology,
capabilities and talent to pursue our
strategic plan.
a
We continue to develop innovative products
that use our scale and expertise and allow
us to deploy capabilities in new and existing
markets and geographies.
Risk management and principal risks
continued
Experian plc
Strategic report
84
a
We use rigorous processes to identify and
select our development investments, so we
can efficiently and effectively introduce new
products and solutions to the market.
a
Where appropriate, and available, we make
acquisitions, minority investments and enter
into strategic alliances, to acquire new
capabilities and enter into new markets.
Responsibility
Our Corporate Development and Experian
Ventures teams, as well as our business units,
monitor the competitive landscape, to develop
and implement appropriate actions.
Changes this year
We are proactive in our efforts to evaluate
competitors and markets, and pursue
investments and enhancements to our data,
analytics, technology and capabilities where
appropriate, available and feasible.
Traditional competitors continue to pursue
differentiated data assets, adjacent vertical
expansion, and new geographic markets. In the
Consumer Services space, other firms have
become bigger competitors in recent years as
we have expanded in areas such as digital
marketplaces and identity protection. We feel
confident in Experian’s relative position and
competitive advantages, but the broader
landscape continues to evolve.
There is a long-term competitive risk to
consider related to newer entrants building
information networks based on consumer
data. While most of them may not be trying to
build a credit bureau or fraud prevention
business as such, this is not many degrees
away from our core business and is being
closely monitored.
Certain governments and central banks in
countries where we have credit bureaux are
collecting loan data from banks, principally
for systemic risk analysis, though some may
share individual loan data with lenders, which
has the potential to compete with some of our
credit reference data services. The timing and
whether any government agencies choose
to go down this route is uncertain. Further
updates on legal and regulatory developments
relating to aspects of this risk are included
above on page 82.
Investment outcomes
We critically evaluate, and may invest in, equity
investments and other growth opportunities,
including internal performance improvement
programmes. To the extent invested, any of
these may not produce the desired financial or
operating results.
Risk category
Risk movement
Strategic
Operational
Stable
Potential impact
Failure to successfully implement our key
business strategies could have a materially
adverse effect on our ability to achieve our
growth targets.
Poorly executed business acquisitions or
partnerships could result in material loss of
business, increased costs, reduced revenue,
substantial legal liability, regulatory
enforcement actions and significant harm
to our reputation.
The impact of this risk, if it materialised, would
typically be felt in the long term.
Examples of control mitigation
a
We carry out comprehensive business
reviews.
a
We perform comprehensive due diligence
and post-investment reviews on acquisitions
and investments.
a
We prioritise our activities within integration
plans to ensure we target first the most
significant gaps to Experian policy.
a
We employ a robust capital allocation
framework.
a
We design our incentive programmes to
optimise shareholder value through delivery
of balanced, sustainable returns and a
sound risk profile over the long term.
Responsibility
Our Corporate Development and Experian
Ventures teams, as well as our business
units, monitor and are responsible for the
investments we make to ensure outcomes
are in line with expectations.
Changes this year
We continue to analyse opportunities and
threats to our business model and work to
address such opportunities and threats
through acquisitions, investments, strategic
partnerships and new technologies where
appropriate.
As we continue to invest significantly in
acquisitions, the successful delivery of these
initiatives remains critical for achieving our
growth ambitions and expected returns. While
public company valuations have generally
declined in the year, price discipline remains
important in assessing privately owned
businesses. The changing market environment
continues to inform our investment strategy
and we remain focused on allocating capital
to the most important strategic priorities.
During the year we have optimised our core
diligence and integration processes to bring
greater risk focus and prioritise key areas for
management attention.
85
Experian plc
Annual Report 2023
Strategic report
Viability
The Group has continued to demonstrate its
resilient business model and diverse strategy,
both of which are described earlier in the
Strategic report. They exemplify our
underlying purpose to create a better
tomorrow, how we create value for our
stakeholders and communities, and how our
data and analytics are helping address the
changing needs of consumers and businesses.
Our strategy has enabled our business to grow
and achieve consistently good financial results
over the past decade, despite changes in the
economic cycle.
Our viability assessment focuses on the
expected future solvency of the Group in the
face of the more severe, but plausible,
unexpected events. We use the liquidity
modelling from the going concern assessment
as a base, and layer on the effects of downside
scenarios to assess the magnitude and
practicality of measures we could take to
continue trading in the face of such events.
We are not expecting the current economic
environment, under any plausible
circumstances, to develop into a scenario
that could threaten our viability.
We consider current-year business
performance and our future prospects by
conducting a regular cycle of strategic
planning, budgeting and forecasting. These
processes appraise revenue, Benchmark EBIT,
cash flows, dividend cover, committed and
forecast funding, liquidity positions and other
key financial ratios, including those relevant
to maintaining our investment-grade credit
ratings.
Solvency
The Group had:
a
at 31 March 2023, undrawn committed bank
borrowing facilities of US$2.4bn, which have
an average remaining tenor of three years
(2022: three years);
a
only one borrowing facility covenant,
requiring Benchmark EBIT to exceed three
times net interest expense before financing
fair value remeasurements (as at 31 March
2023 our cover is 15 times); and
a
Benchmark operating cash inflows of
US$1.8bn and Benchmark interest expense
of US$0.1bn for FY23.
Assessment period
There are a wide variety of time horizons
relevant to managing our business and some
of these are highlighted in the chart below. In
conducting our viability assessment, we have
focused on a three-year timeline because we
believe our three-year financial planning
process provides the strongest basis for
reviewing the outlook for our business beyond
the current financial year.
The assessment process
While we assess our prospects throughout
our planning cycle, we specifically review our
three-year growth expectations and the
external environment as part of the annual
strategic planning process. The Board
participates in this review, using the January
strategy meeting as a focal point.
Assessment of viability
The Group continues to be subject to its
principal risks, which we submit to a rigorous
process of continuous reassessment (see the
principal risks section on pages 78 to 85 in the
Strategic report). We have considered which
principal risks could have the most significant
and direct impact on the viability of the Group
during the three-year period of assessment,
and they are shown overleaf, with the
scenarios used to model those risks.
Climate-related risks and financial impacts
have also been assessed, but are not
considered material over the period of
viability assessment (see the TCFD statement
on page 56).
Our modelling shows that:
a
under our harshest ‘severe but plausible’
scenario (which could cost us around
US$1.3bn over three years), we would
comfortably maintain sufficient drawn and
undrawn borrowing capacity and satisfy all
borrowing facility covenants;
a
further significant headroom could be made
available by scaling back capital investment
or operating expenditure, reducing returns
to shareholders, or increasing our target
leverage range; and
a
in all scenarios, our debt covenant would
be comfortably satisfied.
The results of the scenario testing show that,
due to our diversified nature – which includes
significant counter-cyclical protection, the
resilience of the core business, its substantial
free cash flows and its strong investment-
grade credit ratings – we would withstand the
considered scenarios were these to occur
during the forecast period.
The directors also reviewed and considered
the outcome of the reverse stress test. This
demonstrated that only a catastrophic fall in
cash flows, well beyond that which could
plausibly occur, would exhaust all headroom
in the viability model.
In the event of such a significant scenario
occurring, management would have a number
of more severe mitigating cost reduction or
financing actions, over and above those
modelled in our base scenario, which could be
taken to safeguard the viability of the Group
and provide further additional headroom.
Viability and going concern
1 year
2 years
3 years
5 years
10 years +
Typical service life of data assets
Investment appraisal – acquisitions and organic
Share incentive plans
IT systems development
Financial plan including
cash flow forecasts
Long-term
financing – bonds
Medium-term
financing
– revolving credit
Management
succession
planning
Detailed budgets
Pensions
Climate change
Time horizons affecting prospects
Experian plc
Strategic report
86
Principal risks and viability scenarios
Key assumptions
The directors have made the following key
assumptions:
a
The Group continues to achieve strong cash
flow conversion, and maintains its
investment-grade credit ratings such that
funding in the form of capital markets debt,
committed bank borrowing facilities or
alternatives is available in all plausible
market conditions to renew debt as it
matures and to raise new debt, maintaining
a Net debt/Benchmark EBITDA leverage
range of 2.0–2.5x, in line with our target
range.
a
Effective tax rates remain broadly stable
(before the impact of any changes of
legislation) over the medium term.
a
In assessing viability, it is assumed that the
detailed risk management process as
outlined on page 79 captures all plausible
risks, and that the mitigating actions are
implemented on a timely basis and have the
intended impact.
Viability statement
Based on their assessment of prospects and
viability, and the Board’s rigorous assessment
of the emerging and principal risks, the
directors confirm that they have a reasonable
expectation that the Group will be able to
continue in operation and meet its liabilities as
they fall due over the three-year period ending
31 March 2026. Looking further forward, the
directors have considered whether they are
aware of any specific relevant factors beyond
the three-year horizon that would threaten the
long-term financial stability of the Group and
have confirmed that, other than the uncertainty
surrounding the geopolitical and
macroeconomic environment, they are not
aware of any.
Going concern statement
Our going concern assessment focuses on
immediately available sources of liquidity to
fund our anticipated trading pattern, plus
anticipated acquisition spend, returns to
shareholders and capital investment, ensuring
we always maintain a comfortable margin of
headroom in case of the unexpected. We also
perform a review of indicators typical of
emerging going concern issues, and have
identified none.
The directors believe that the Group and the
Company are well placed to manage their
financing and other business risks
satisfactorily to continue to meet their liabilities
as they fall due, and have a reasonable
expectation that the Group and the Company
will have adequate resources to continue their
operational existence, for at least 12 months
from the date of signing these financial
statements. The directors therefore consider it
appropriate to adopt the going concern basis of
accounting in preparing the financial
statements. In reaching this conclusion, the
directors noted the Group’s strong cash
performance in the year, and its resilience in
the face of a viability reverse stress test
scenario.
Strategic report
This Strategic report was approved by a duly
authorised committee of the Board of directors
on 16 May 2023 and signed on its behalf by:
Charles Brown
Company Secretary
16 May 2023
Principal risk and scenario
Impact modelling
Modelling details
Data loss/misuse
Leading to serious reputational and brand
damage, legal penalties and class action
litigation.
a
We assessed the maximum credible extent
of a ransomware incident and modelled the
likely financial impacts through loss of
revenue, dispute and regulatory actions, and
the costs of remediation.
a
We considered a ransomware scenario
involving sensitive consumer financial or
health-related data. We modelled the effects
of reputational damage – significant
reduction in key strategic client revenue, as
well as effects across the board in the
business line affected, and indirect effects in
other business lines and other regions. We
modelled the costs of contacting consumers
affected and offering free credit repair
services, the impact of likely legal and
regulatory actions, less insurance
recoveries anticipated. We also
benchmarked our modelling to market data
available for costs disclosed by others in
similar circumstances.
Macroeconomic
The uncertainty surrounding the geopolitical
and macroeconomic environment, in
particular increased inflation and the raising
of interest rates.
a
We assessed one or more of our major
countries of operation, modelling significant
economic deterioration, currency weakness
or restriction.
a
We modelled the impact of growth
stagnating over the three-year assessment
period, using statistical analysis of historical
Group results in previous economic
downturns.
Legislative/regulatory change and compliance
New legislation or changes in regulatory
enforcement changing how we operate our
business.
a
We assessed the maximum credible extent
of simultaneous legal actions in two of our
core markets.
a
We modelled the likely financial impacts,
after potential insurance recoveries, using
our history and professional advice on the
levels of fines and penalties in the industry
and what is permitted by regulatory
enforcement
.
87
Experian plc
Annual Report 2023
Strategic report
Governance
In this section
89
Chair’s introduction
92
Board of directors
94
Corporate governance report
108
Nomination and Corporate Governance
Committee report
113 Audit Committee report
121 Report on directors’ remuneration
146 Directors’ report
Experian plc
Governance
88
Environmental, Social and
Governance (ESG)
As well as the strategic objectives of the
business, a critical area that the Board and
the business have focused on is to ensure
that Experian maintains and elevates its
contribution to wider society. Already we have
made noteworthy progress on our ESG
performance, including achieving our Social
Innovation programme target of reaching 100
million people before the end of FY23, two
years ahead of target; achieving our target of
connecting with 100 million people through
United for Financial Health before the end of
FY23, one year ahead of target; and expanding
our People strategy to include an updated
Diversity, Equity and Inclusion (DEI) strategy.
Our next steps will include increasing the level
of planning and assurance we need to have for
new ESG targets, and clearly demonstrating
and communicating the breadth of positive
impact we can have on consumers and
businesses across the globe.
Board composition
The Board continued to execute its succession
plans during the year, and a number of Board
changes were made. Jonathan Howell became
Chair of the Audit Committee on 1 July 2022, in
place of Deirdre Mahlan. At the Annual General
Meeting on 21 July 2022, Deirdre Mahlan,
George Rose and Kerry Williams left the Board,
Craig Boundy (our Chief Operating Officer) was
appointed as a director, and Alison Brittain was
appointed as our Senior Independent Director
and Chair of the Remuneration Committee,
replacing George Rose. All these changes
had been well planned and considered by
the Nomination and Corporate Governance
Committee over a number of meetings. During
the year we appointed Kathleen DeRose, Louise
Pentland and Esther Lee as new non-executive
directors. Kathleen brings financial services
expertise to the Board, with a focus on
investment management as well as significant
FinTech experience, and Louise has significant
legal and regulatory experience from FinTech,
technology and digital industries. Esther is very
well placed, qualified and experienced to
support Experian with her extensive knowledge
of consumers and insight into their needs.
Finally, on 31 January 2023, Dr Ruba Borno
stepped down from the Board after a successful
tenure.
I am pleased to report that the Experian Board
exceeds the FTSE Women Leaders Review
targets, with 45% Board female representation,
and Alison Brittain is Experian’s Senior
Independent Director. We also exceed the
Parker Review targets for director ethnicity.
While this is all positive, the Board will continue
to oversee the development of an inclusive
environment, and ensure a diverse pipeline,
among its many other activities.
Chair’s introduction
operate at all times in a manner that is
consistent with the highest corporate
governance standards.
Strategy
Strategic oversight and implementation are
key responsibilities of the Board and were
reflected during the year through a number of
activities. The Board spent a number of days
together reviewing the Group’s FY24 strategy,
received a mid-year update on strategic
progress, as well as regular updates from the
Chief Executive Officer, Chief Financial Officer
and Chief Operating Officer. The Audit
Committee, under its new Chair Jonathan
Howell, reviewed the strategies of the key
second line of defence risk, cyber security and
compliance functions, and received regular
updates from them, as well as dealing with the
Committee's regular business. Alison Brittain,
the Senior Independent Director, took over as
our Remuneration Committee Chair, and spent
considerable time during the year reviewing
reward-related matters in the run-up to a
remuneration policy year. This year was also
an active one for Board composition and, as
Chair of the Nomination and Corporate
Governance Committee, I ensured that there
was a smooth handover of Committee chair
responsibilities, and a well-run process to
appoint and induct new Board members.
Chair’s introduction
I am pleased to present, on behalf of the Board,
the corporate governance statement of the
Company for the year ended 31 March 2023.
This report summarises the role and activities
of the Board, its principal committees and the
directors in providing effective leadership to
promote long-term sustainable success for
Experian’s shareholders, and helping Experian
contribute to wider society.
It was very pleasing that the Board was able
to meet in person this year for all its meetings,
given the impact of the COVID-19 pandemic in
recent years. The Board visited our Brazilian
and UK and Ireland businesses and colleagues,
and also again spent time with our North
America business in Costa Mesa, California.
Board members benefit hugely from these
visits which, among other things, allow them
to get a meaningful sense of how the culture
across the business aligns with Experian’s
purpose, values and strategy.
The Board’s collective view of the importance
of good governance remains unchanged.
The Board needs to ensure continued good
oversight of strategy, operations and
governance, to provide challenge, support
and guidance to the executive team and the
business. The Board is also conscious of the
important role that it plays to ensure that we
Good corporate governance is key to promoting
long-term sustainable success for the benefit
of all our stakeholders. It is at the heart
of our business and Board decisions and
aligns with our culture, values and ethics.
Mike Rogers
Chair
89
Experian plc
Annual Report 2023
Governance
Board evaluation
We conducted an external Board evaluation
during the year and the overall conclusion was
that the Board was considered to be one of the
best boards that Manchester Square Partners
(MSP) had worked with in recent years. The
Board had been strong three years previously,
when MSP conducted the Board review, and
was now even better, despite the external
challenges over that time. As a result, there
were only a small number of recommended
actions coming out of the MSP evaluation
report which are outlined later in this report.
The Board had become more discursive. There
was alignment around the challenges and
emerging risks facing the Group and a
significant improvement in actions around
talent development and diversity under the
leadership of the Chief People Officer. In terms
of current performance, the Board continues to
function extremely well and in line with
first-class corporate governance standards.
Board dynamics remain strong, demonstrating
the smoothness of the transition from several
highly regarded and influential directors to
their successors.
Conclusion
I hope you find this Corporate governance
report helpful in understanding the
governance processes we have in place at
Experian, and what we have done in terms
of the recommendations of the UK Corporate
Governance Code. The Board is well placed
to provide the strategic oversight and
stewardship required to ensure that Experian
continues to deliver long-term sustainable
success.
The 2023 Annual General Meeting will be
held on 19 July 2023. Further details will
be published in the Notice of Annual General
Meeting, which has been sent or made
available to shareholders, and is also
available on the Company’s website,
www.experianplc.com
.
Statement of compliance
For the year ended 31 March 2023, other than
for one element of Provision 38 in relation to
the alignment of pension contribution rates
in respect of which the Company became
compliant on 1 January 2023 (as discussed
below), the Company complied with all the
provisions of the UK Financial Reporting
Council’s (FRC’s) Corporate Governance Code
(as published in July 2018), the UK Financial
Conduct Authority’s (FCA's) Disclosure
Guidance and Transparency Rules sourcebook
sections 7.1 and 7.2 (which set out certain
mandatory disclosure requirements), the FCA’s
Listing Rules 9.8.6R, 9.8.7R and 9.8.7AR which
include the ‘comply or explain’ requirement
and, on a voluntary basis, the UK Department
for Business and Trade Directors’
Remuneration Reporting Regulations and
Narrative Reporting Regulations. These
documents are publicly available as follows:
a
The Corporate Governance Code can be
found at
www.frc.org.uk
.
a
The FCA’s Disclosure Guidance and
Transparency Rules sourcebook as
well as Listing Rules can be found at
www.handbook.fca.org.uk
.
a
The Directors’ Remuneration Reporting
Regulations and Narrative Reporting
Regulations can be found at
www.gov.uk
.
In addition, the FRC Guidance on Risk
Management, Internal Control and Related
Financial and Business Reporting can be
found at
www.frc.org.uk
.
Provision 38
– as explained in our 2022 Annual
Report, the Company was in partial compliance
with Provision 38 of the Corporate Governance
Code with respect to alignment of pension
contribution rates of the executive directors
with the wider workforce for the period to
1 January 2023. The non-alignment arose
from the pension contribution rates of our
two existing UK-based executive directors
being unaligned with the wider UK workforce.
This was remedied on 1 January 2023, in line
with the expected timeframe set out in our
2022 Annual Report.
Chair’s introduction
continued
Experian plc
Governance
90
Application of the UK Corporate
Governance Code 2018
The FRC promotes high-quality corporate
governance and reporting through the UK
Corporate Governance Code (the Code),
which all companies with a Premium Listing
on the London Stock Exchange are required
to either comply with in full, or explain why,
and to what extent, they do not fully comply
(‘comply or explain’). This Governance
section of the Annual Report explains how
each of the Code principles, as set out below,
has been applied.
Section 1: Board Leadership and
Company Purpose
Principle A:
A successful company is led
by an effective and entrepreneurial board,
whose role is to promote the long-term
sustainable success of the company,
generating value for shareholders and
contributing to wider society. See pages 92
to 93.
Principle B:
The board should establish the
company’s purpose, values and strategy, and
satisfy itself that these and its culture are
aligned. All directors must act with integrity,
lead by example and promote the desired
culture. See page 100.
Principle C:
The board should ensure that
the necessary resources are in place for the
company to meet its objectives and measure
performance against them. The board
should also establish a framework of
prudent and effective controls, which
enable risk to be assessed and managed.
See page 102.
Principle D:
In order for the company to
meet its responsibilities to shareholders and
stakeholders, the board should ensure
effective engagement with, and encourage
participation from, these parties. See pages
104 to 107.
Principle E:
The board should ensure that
workforce policies and practices are
consistent with the company’s values and
support its long-term sustainable success.
The workforce should be able to raise any
matters of concern. See page 107.
Section 2: Division of Responsibilities
Principle F:
The chair leads the board and
is responsible for its overall effectiveness
in directing the company. They should
demonstrate objective judgment throughout
their tenure and promote a culture of
openness and debate. In addition, the chair
facilitates constructive board relations and
the effective contribution of all non-executive
directors, and ensures that directors receive
accurate, timely and clear information.
See page 103.
Principle G:
The board should include
an appropriate combination of executive
and non-executive (and, in particular,
independent non-executive) directors,
such that no one individual or small group
of individuals dominates the board’s
decision-making. There should be a clear
division of responsibilities between the
leadership of the board and the executive
leadership of the company’s business.
See page 103.
Principle H:
Non-executive directors should
have sufficient time to meet their board
responsibilities. They should provide
constructive challenge, strategic guidance,
offer specialist advice and hold management
to account. See page 107.
Principle I:
The board, supported by the
company secretary, should ensure that it has
the policies, processes, information, time
and resources it needs in order to function
effectively and efficiently. See pages 103
and 107.
Section 3: Composition, Succession
and Evaluation
Principle J:
Appointments to the board
should be subject to a formal, rigorous and
transparent procedure, and an effective
succession plan should be maintained for
board and senior management. Both
appointments and succession plans should
be based on merit and objective criteria and,
within this context, should promote diversity
of gender, social and ethnic backgrounds,
cognitive and personal strengths.
See pages 110 and 111.
Principle K:
The board and its committees
should have a combination of skills,
experience and knowledge. Consideration
should be given to the length of service of
the board as a whole and membership
regularly refreshed. See pages 94 to 96.
Principle L:
Annual evaluation of the board
should consider its composition, diversity
and how effectively members work together
to achieve objectives. Individual evaluation
should demonstrate whether each director
continues to contribute effectively. See
pages 111 and 112.
Section 4: Audit, Risk and Internal
Control
Principle M:
The board should establish
formal and transparent policies and
procedures to ensure the independence and
effectiveness of internal and external audit
functions and satisfy itself on the integrity
of financial and narrative statements.
See pages 117 to 119.
Principle N:
The board should present a fair,
balanced and understandable assessment
of the company’s position and prospects.
See page 116.
Principle O:
The board should establish
procedures to manage risk, oversee the
internal control framework, and determine
the nature and extent of the principal risks
the company is willing to take in order to
achieve its long-term strategic objectives.
See pages 119 to 120 and the Risk section of
the Strategic report.
Section 5: Remuneration
Principle P
: Remuneration policies and
practices should be designed to support
strategy and promote long-term sustainable
success. Executive remuneration should be
aligned to company purpose and values, and
be clearly linked to the successful delivery
of the company’s long-term strategy.
See page 126.
Principle Q:
A formal and transparent
procedure for developing policy on executive
remuneration and determining director and
senior management remuneration should be
established. No director should be involved
in deciding their own remuneration outcome.
See pages 121 to 123 and 138.
Principle R:
Directors should exercise
independent judgment and discretion
when authorising remuneration outcomes,
taking account of company and individual
performance, and wider circumstances.
See page 123.
91
Experian plc
Annual Report 2023
Governance
Board of directors
Mike Rogers (58)
Chair
Appointed to the Board on 1 July 2017, and as
Chair (and Chair of the Nomination and Corporate
Governance Committee) on 24 July 2019.
Other current roles:
Mike is the non-executive
Chair of Admiral Group PLC and Aegon UK.
Skills and contribution:
Mike brings over
30 years of banking and financial services
experience, with a reputation for strategic
insight and focused execution. His current and
previous board-level experience, both executive
and non-executive, is of huge value to the
Experian Board.
Experience:
Mike was Group Chief Executive
Officer of LV= Group from 2006 until 2016, during
which time he grew the organisation into a
significant player in the life and general insurance
market. Before that, Mike was with Barclays plc
for more than 20 years, holding a number of
senior roles, most recently as Managing Director,
UK Retail Banking. He was previously a
non-executive director of the Association
of British Insurers and NatWest Group plc.
Caroline Donahue (62)
Non-executive director
Appointed to the Board on 1 January 2017.
Other current roles:
Caroline is on the Board of
GoDaddy Inc., Versapay and Emerge America.
Skills and contribution:
Caroline brings
extensive experience of international markets
and technology as well as knowledge of
consumer sales and marketing, innovation and
consumer-centricity. The Board also benefits
from her insight and extensive experience in
mass-market, digital, multi-channel and B2C
distribution, marketing, and brand and sales
management.
Experience:
Caroline previously held roles at
Intuit where she was Executive Vice President,
Chief Marketing and Sales Officer; Senior Vice
President, Sales and Channel Marketing; and
Vice President and Director of Sales. She also
held sales and channel management roles at
Knowledge Adventure, NeXT Computer and
Apple, Inc. Caroline was previously on the
Executive Committee of Northwestern C100,
the Board of the Computer History Museum,
and a mentor for She-Can.
Brian Cassin (55)
Chief Executive Officer
Appointed to the Board as Chief Financial
Officer on 30 April 2012, and as Chief Executive
Officer on 16 July 2014.
Other current roles:
Brian is a non-executive
director (and the Senior Independent Director)
of J Sainsbury plc. He also sits on its Audit and
Nomination Committees.
Skills and contribution:
Brian brings strong
leadership, a clear view of strategic objectives
and decisive management skills to this role.
He has strong financial and commercial
acumen and a broad range of operational
competencies. His non-executive role
augments his strong board-level experience.
Experience:
Brian was previously the Chief
Financial Officer of Experian and, before that,
Managing Director at Greenhill & Co. He has
also held various senior roles at Baring
Brothers International and the London
Stock Exchange.
Luiz Fleury (66)
Non-executive director
Appointed to the Board on 8 September 2015.
Other current roles:
Luiz is a Board member
of DOTZ S.A.
Skills and contribution:
Luiz has spent most
of his career in financial services and has
extensive insight and deep local knowledge of
the Brazilian financial market. His considerable
boardroom experience adds to the strength,
depth and effectiveness of our Board.
Experience:
Luiz has held Chief Executive roles
at Cetip S.A., Banco Ibi and Redecard, together
with senior finance and investment positions at
Banco Citibank S.A., Banco Marka S.A. and C&A
Brenninkmeyer Brasil. Luiz was President and
a member of the Executive Board at Cetip S.A.,
and a Board member of Grupo Sequóia de
Logística, Eneva S.A., Discount Malls do Brasil,
Banco Ibi, FHV Holdings Ltda., Magnopus, Inc.
and Carrefour Brazil (the trading name of
Atacadão S.A.).
Lloyd Pitchford (51)
Chief Financial Officer
Appointed to the Board on 1 October 2014.
Other current roles:
Lloyd is a non-executive
director (and chairs the Audit Committee) of
Bunzl plc.
Skills and contribution:
Lloyd is a qualified
accountant and holds an MBA. He has deep
financial, operational and strategic skills,
built through a career working in a diverse
range of globally complex growth-oriented
organisations. He brings additional perspectives
to Experian from his non-executive role with
Bunzl plc. Lloyd sponsors Experian’s
Environmental, Social and Governance (ESG)
and employee mental health programmes.
Experience:
Lloyd has over two decades of
experience in financial and commercial
leadership positions across a range of dynamic
industries; including 13 years as Group Chief
Financial Officer. Before joining Experian, Lloyd
held a wide portfolio of finance, technology and
operational responsibilities: as Chief Financial
Officer of Intertek Group plc; in senior finance
roles (including Group Financial Controller) at
BG Group plc; and in financial and commercial
roles at Mobil Oil.
Nm
Re
Au
Au
Nm
Nm
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Re
Jonathan Howell (60)
Non-executive director
Appointed to the Board on 1 May 2021, and as
Chair of the Audit Committee on 1 July 2022.
Other current roles:
Jonathan is the Chief
Financial Officer of The Sage Group plc.
Skills and contribution:
Jonathan has a wealth
of financial, strategic, technology and regulatory
expertise, encompassing both B2B and B2C,
which is of huge benefit to Experian. He is a
highly regarded FTSE 100 Chief Financial Officer,
and also brings considerable executive and
non-executive UK-listed boardroom experience.
Jonathan's financial expertise and experience
ensure effective leadership of our Audit
Committee.
Experience:
Jonathan was previously an
independent non-executive director and Chair
of the Audit and Risk Committee of The Sage
Group plc., for five years while serving as Group
Finance Director of Close Brothers Group plc for
ten years until November 2018. Before that he
was Group Finance Director at London Stock
Exchange Group plc for nine years and has also
been a non-executive director of EMAP plc and
Chair of FTSE International. The early part of
Jonathan's career was at Price Waterhouse
where he qualified as a chartered accountant.
Nm
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Au
Experian plc
Governance
92
Code principle
Board Leadership
Kathleen DeRose (62)
Non-executive director
Appointed to the Board on 1 November 2022.
Other current roles:
Kathleen is a Professor at
the New York University (NYU) Stern School of
Business, the Director of the NYU Stern Fubon
Center for Technology, Business, and Innovation
and the Director of its FinTech Initiative. She is
a non-executive director of London Stock
Exchange Group plc, Voya Financial, Inc. and
Enfusion, Inc.
Skills and contribution:
As well as bringing
significant FinTech experience to the Experian
Board, Kathleen brings financial services
expertise with a focus on investment
management. She also has considerable
non-executive listed boardroom experience.
Experience:
Prior to her current roles, Kathleen
had an extensive career in global financial
services, including at Credit Suisse, Hagin
Investment Management, Bessemer Trust,
Deutsche Asset Management, and Chase
Manhattan Bank.
Au
Au
Au
Nm
Nm
Nm
Re
Re
Re
Louise Pentland (51)
Non-executive director
Appointed to the Board on 1 November 2022.
Other current roles:
Louise is a non-executive
director of Hitachi, Ltd and Pacific Mutual
Holding Company.
Skills and contribution:
Louise brings significant
legal and regulatory experience from FinTech,
technology and digital industries, and also has
listed non-executive boardroom experience.
Having spent many years as a senior executive
at leading global technology companies, Louise
has a deep understanding of business, law,
human resources (including remuneration
committee management), leadership, innovation
and culture.
Experience:
Louise was most recently Executive
Vice President and Senior Adviser to the CEO at
PayPal Holdings, Inc. Responsibilities included
leading its legal and regulatory requirements
across all markets working with international
regulators, overseeing PayPal's ESG strategy and
impact, running the Human Resources function
and leading intellectual property and innovation
activities. Prior to PayPal, she held a wide range
of senior roles at Nokia Corporation, and had
also spent time at Avon Cosmetics following
qualification as a solicitor.
Craig Boundy (48)
Chief Operating Officer
Appointed to the Board on 21 July 2022.
Skills and contribution:
Craig has excellent
commercial and operational expertise, and
will continue to progress Experian’s journey
of innovation-led growth. He has a strong
commitment to fostering diversity, equity and
inclusion within Experian, and is the global lead
for race and ethnicity.
Experience:
Craig’s roles at Experian have
included Chief Executive Officer (CEO) of
Experian North America, and Managing Director
of Experian UK and Ireland. Previously, he was
CEO of Global Operations at Logica UK, Chief
Operating Officer (COO) at Cable & Wireless’
businesses in Europe, US and Asia, and Sales
Director and COO at Energis. His early career
was with BT.
Esther Lee (64)
Non-executive director
Appointed to the Board on 31 March 2023.
Other current roles:
Esther is a non-executive
director (and Chair of the Nomination and
Governance Committee) of The Clorox Company
and a non-executive director of Pearson plc.
Skills and contribution:
Esther brings strong
brand development, and consumer
engagement and communication perspectives
to the Experian Board, as well as extensive
knowledge in consumer and trends. The Board
benefits from her significant executive and
marketing expertise in developing consumer
and customer strategies to enable growth,
drive customer-centric innovation and business
transformation, and enhance global marketing
and branding.
Experience:
Esther previously held several
corporate executive roles. At MetLife, she was
Executive Vice President and Global Chief
Marketing Officer. She has also held senior
leadership roles at AT&T and The Coca Cola
Company. Prior to her corporate career, Esther
spent several years in leadership roles in the
advertising industry at global agency networks
such as WPP and Havas.
Alison Brittain (58)
Senior Independent Director
Appointed to the Board on 1 September 2020,
and as Senior Independent Director and Chair of
the Remuneration Committee on 21 July 2022.
Other current roles:
Alison is Chair of English
football's Premier League and Dunelm Group
plc (where she chairs the Nominations
Committee), a non-executive director of British
Airways plc, and Chair and a Trustee of the
Prince's Trust Group.
Skills and contribution:
Alison is a highly
versatile business leader and general manager,
who holds an MBA and brings considerable
experience of operating in consumer-facing
service environments. She has over 25 years’
senior management experience in major
financial institutions and consumer businesses.
The Board benefits from her significant
board-level experience.
Experience:
Alison was previously CEO of
Whitbread PLC, group director with Lloyds
Banking Group and a board director of
Santander UK PLC. She held senior roles at
Barclays Bank, and was a non-executive director
of Marks & Spencer Group PLC. She has been
a member of the UK Prime Minister's Advisory
Councils, under several administrations and
was awarded a CBE in the 2019 UK New Year
Honours list.
Company Secretary:
Charles Brown FCG
Independent Auditor:
KPMG LLP, Chartered
Accountants and Recognized Auditor
Member of the Audit Committee
Member of the Nomination and
Corporate Governance Committee
Member of the Remuneration Committee
Committee Chair
Au
Nm
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Au
Nm
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93
Experian plc
Annual Report 2023
Governance
Code principle
Board Leadership
Corporate governance report
Board
Composition
The Board currently comprises the Chair,
Mike Rogers, three executive directors and
seven independent non-executive directors,
including the Senior Independent Director,
Alison Brittain. On 21 July 2022, Deirdre
Mahlan, George Rose and Kerry Williams
retired as directors, and Craig Boundy was
appointed as a director. There were also
changes to the Chairs of the Audit and
Remuneration Committees in July 2022,
and Alison Brittain was appointed as
Senior Independent Director. Kathleen DeRose
and Louise Pentland were appointed as
independent non-executive directors on
1 November 2022. Esther Lee joined the
Board on 31 March 2023. On 31 January 2023,
Dr Ruba Borno stepped down from the Board.
The directors’ biographical details are set out
on pages 92 and 93.
Corporate governance at a glance
The composition of the Board is subject to
ongoing review, with considerations including
diversity and maintaining the correct balance
of skills, experience, knowledge and tenure.
All appointments result from a formal and
rigorous search, responsibility for which is
delegated to the Nomination and Corporate
Governance Committee. It is recognised that
a diverse Board with a range of views, insights,
perspectives, and opinions enhances Board
decision-making and effectiveness. The Board
is satisfied that its current composition
exhibits a diverse mix of skills, professional
and industry backgrounds, geographical
experience and expertise, gender, age, tenure
and ethnicity.
Board and senior management diversity
Diversity and inclusion are embedded within
our culture. The Board remains committed
to having an inclusive culture that recognises
the importance of gender, social and ethnic
diversity, and the benefits gained from
different perspectives.
This section outlines the key diversity and
inclusion metrics for Board members and
executive management (as at 31 March 2023,
being the chosen reference date within this
accounting period, as required by the Listing
Rules LR 9.8.6(9)–(11)). This section also
includes details of tenure, age, skills and
experience.
Gender and ethnic diversity
The FCA, in its capacity as the UK Listing
Authority, introduced new rules during 2022
that require listed companies to publish
information on female and ethnic representation
on the Board and in senior management. This
year is our first year to report on these new
requirements. The tables opposite outline the
current gender and ethnic diversity of the
Board and executive management.
Board members
Number of Board
senior positions
1
Executive management
2
Number
%
Number
%
Men
6
55
3
11
73
Women
5
45
1
4
27
Other
–
–
–
–
–
Not specified/prefer not to say
–
–
–
–
–
Board members
Number of Board
senior positions
1
Executive management
2
Number
%
Number
%
White British or other White
(including minority-white
groups)
9
82
4
12
80
Mixed/Multiple Ethnic Groups
—
—
—
—
—
Asian/Asian British
1
9
—
—
—
Black/African/Caribbean/
Black British
—
—
—
—
—
Other ethnic group,
including Arab
1
9
—
3
20
Not specified/prefer not to say
—
—
—
—
—
1
As defined by the FCA, senior positions on the Board comprise the Chair, Chief Executive Officer, Chief Financial Officer and
Senior Independent non-executive Director.
2
Executive management comprises the members of the Group Operating Committee, including the Chief Executive Officer,
the Chief Financial Officer and the Chief Operating Officer.
All information on the Board and Executive management gender identity and ethnic background was manually gathered.
Board
White British or other
White (including
minority-white groups)
Asian/Asian British
Other ethnic group,
including Arab
Executive management
White British or other
White (including
minority-white groups)
Other ethnic group,
including Arab
Gender identity
Ethnic background
Board
Women
Men
Women
Executive management
Men
Experian plc
Governance
94
Code principle
Board Leadership and Company Purpose
The length of time each of the directors has served on the Board, as at 31 March 2023.
Gender diversity of Group Operating
Committee and direct reports
A. Chair
1
B. Executive
3
C. Independent non-executive directors
7
Balance of executive and
non-executive directors
A
B
C
A. American
3
B. Brazilian
1
C. British
6
D. Irish
1
Board nationality
D
C
B
A
10y 11m
Brian Cassin
8y 6m
7y 7m
6y 3m
5y 9m
2y 7m
1y 11m
8m
5m
5m
<1m
Lloyd Pitchford
Luiz Fleury
Caroline Donahue
Mike Rogers
Alison Brittain
Jonathan Howell
Craig Boundy
Kathleen DeRose
Esther Lee
Louise Pentland
Board tenure
Board age
A. 40 to 49
1
B. 50 to 59
5
C. 60 to 69
5
A
B
C
73%
27%
Men
Women
95
Experian plc
Annual Report 2023
Governance
Code principle
Board Leadership and Company Purpose
Non-executive directors’ key skills and
experience
The Board recognises the relationship
between the delivery of the Company strategy
and objectives and the skills needed on the
Board now and in the future. The mix of key
skills, experience and knowledge of the
non-executive directors set out opposite
provides insight for the Board and the
Nomination and Corporate Governance
Committee to ensure the Board and its
committees are optimally composed to
maximise their effectiveness.
Role of the directors
The Board provides entrepreneurial leadership
and sets the Company’s purpose, strategy and
values, ensuring these are aligned with our
culture. It is responsible for monitoring
progress against Experian’s strategic
objectives, approving proposed actions and
ensuring that the necessary resources are
available for long-term sustainable success, to
generate value for shareholders and contribute
to wider society. The Board is supported by its
committees, the executive directors, key
operating subsidiaries and the Group
Operating Committee, while retaining exclusive
control and oversight over the decisions set out
in the Schedule of Matters Reserved for the
Board.
Strategic and budget planning process
Non-executive directors’ key skills and experience
March
Board budget review
Ensuring the correct resources are in
place to deliver the Group strategy
September
Group Operating Committee strategic review
Including detailed strategic plans
June
Group Operating Committee review meeting
Offsite strategy session to focus on key
strategic issues
October to November
Financial planning and prioritisation
Refinement and costing of plans and
prioritisation of opportunities
January
Board strategy review
Two-day strategy presentations
from senior leaders within the Group
September
Board strategy review
Mid-year review of progress
Financial
Services
FinTech
Consumer
Technology/
Information
Financial
qualification
Legal/
Regulation
Serving listed
executive
Mike Rogers
Alison Brittain
Kathleen DeRose
Caroline Donahue
Luiz Fleury
Jonathan Howell
Esther Lee
Louise Pentland
Corporate governance report
continued
Experian plc
Governance
96
Code principle
Board Leadership and Company Purpose
The Board sets the Group’s strategy, and in
January 2023 reviewed the proposed strategic
plan presented by senior management. Our
high-level strategy is unchanged from that
which we set out in January 2022 (and in
previous years): front and centre is the
purpose that Experian was built on – being
a force for financial wellbeing and inclusion
that brings financial power to all is central
to our brand, articulated by our people and
mutually reinforced by our culture. Across
the organisation, our people take pride in the
positive impacts we have across the markets
and societies in which we operate. The core
of our strategy remains having the deepest,
broadest and most unique datasets available
in our markets. Over the past decade, we have
invested strongly in our people and the
organisation, creating a unique foundation for
future growth. We have redefined Experian in
the eyes of many stakeholders, while entering
new spaces and stretching the boundaries of
our ambition. As always, there is more to do to
strengthen the business and realise our vision.
The growth opportunities for Experian remain
large and we believe we are well positioned for
the future.
This year, the strategy presentations took
place, face-to-face, over two days at our North
America operational headquarters in Costa
Mesa, California, with senior leaders from
across the Experian business. This time allows
the Board to critically assess the proposed
strategy with management, before considering
it for approval. This year’s presentations
included regional and business updates. The
business strategic updates included the newly
formed Experian Software Solutions (ESS)
business. Regional strategic updates included
the EMEA and Asia Pacific transformation
journey, and North America, including a deep-
dive into various business units.
In March 2023, the Chief Technology Officer
presented the Board with a review of the
technology strategy. The Board also received
and discussed an ESG strategy update with
the Chief Sustainability Officer. The update
included details of how we are operationalising
our ESG strategy: continuing to drive progress
across the breadth of ESG, ensuring we have
robust execution plans to achieve our existing
commitments, while considering where
additional commitments may be needed. In
July 2022, the Board travelled to the UK and
visited our UK and Ireland operational
headquarters and reviewed the regional
strategy with management. In September
2022, the Board spent time in São Paulo, Brazil,
where they reviewed the Latin America
strategy.
The strategic framework considered by the
Board includes details of the foundations that
allow us to deliver our growth aspirations,
for example embedding a high-performance
culture, ensuring sustainability through strong
client relationships and reinvestment following
productivity improvements. The Board also
reviews strategy and major initiatives
throughout the year (as indicated on the
Strategic and budget planning process chart).
The budget discussions in March are focused
on ensuring that we have the right resources
to deliver the agreed strategy. These
discussions include detailed focus on both
regional and global business budgets. The
Board continually monitors management and
financial performance against the Group’s
objectives. To enable it to do this the Board
receives updates, at every scheduled Board
meeting, on operational and financial matters
as well as any major initiatives underway. The
Board also receives relevant between-meeting
updates, to allow for appropriate oversight
and monitoring. The Board conducts post-
investment reviews on an agreed timeline, for
any acquisitions it has previously approved.
You can read about the Board’s procedures
to manage risk, oversee the internal control
framework, and determine the nature and
extent of the principal risks the Company
is willing to take to achieve its strategic
objectives, in the Risk management and
internal control systems section on pages 119
and 120.
The Board delegates management of the
Group’s day-to-day activities but is accountable
to shareholders for delivering financial
performance and long-term shareholder
value. To achieve this, the Board has put in
place a framework of controls, including
clear and robust procedures and delegated
authorities, which enables the Group to
appraise and manage risk effectively. This
framework is illustrated in the Governance
framework diagram on page 102.
In addition, the Board has reserved decisions
about certain key activities to itself, including:
A. Strategy and management
– approval and
oversight of Experian’s long-term objectives
and commercial (and ESG) strategy, approval
of annual operating and capital expenditure
budgets, and oversight and monitoring of
operations.
B. Structure and capital/Financial reporting
and controls/Risk management
– changes in
the Group capital or corporate structure.
Approval of the Group’s results, dividends,
dividend policy, significant changes in
accounting policy, tax policy and treasury
policy.
C. Contracts
– approval of major or strategic
capital projects, and of major acquisitions,
disposals and investments.
D. Communication
– approval of key
stakeholder documents, circulars,
prospectuses, and reviewing investor
sentiment.
E. Board membership/Delegation of
authority/Corporate governance/Policies
– approval of changes to Board composition,
ensuring adequate succession planning,
reviewing reports from Board committees,
reviewing governance arrangements, and
approval of various policies.
Details of the activities of the Board during the
year under these headings are on page 99.
A high-level statement of the types of decisions
that have been delegated by the Board is
shown in the Governance framework diagram
on page 102.
97
Experian plc
Annual Report 2023
Governance
Code principle
Board Leadership and Company Purpose
Board
Nomination
and Corporate
Governance
Committee
Remuneration
Committee
Audit
Committee
Mike Rogers
6/6 – 100%
6/6 – 100%
4/4 – 100%
n/a
Brian Cassin
6/6 – 100%
n/a
n/a
n/a
Lloyd Pitchford
6/6 – 100%
n/a
n/a
n/a
Craig Boundy (appointed 21 July 2022)
4/4 – 100%
n/a
n/a
n/a
Alison Brittain
6/6 – 100%
6/6 – 100%
4/4 – 100%
4/4 – 100%
Kathleen DeRose* (appointed 1 November 2022)
2/3 – 66%
3/3 – 100%
2/3 – 66%
2/2 – 100%
Caroline Donahue
6/6 – 100%
6/6 – 100%
4/4 – 100%
4/4 – 100%
Luiz Fleury
6/6 – 100%
6/6 – 100%
4/4 – 100%
4/4 – 100%
Jonathan Howell**
5/6 – 83%
4/6 – 66%
2/4 – 50%
3/4 – 75%
Esther Lee (appointed 31 March 2023)
n/a
n/a
n/a
n/a
Louise Pentland (appointed 1 November 2022)
3/3 – 100%
3/3 – 100%
3/3 – 100%
2/2 – 100%
Past directors
Dr Ruba Borno (to 31 January 2023)
4/5 – 80%
4/5 – 80%
2/3 – 66%
3/3 – 100%
Deirdre Mahlan (to 21 July 2022)
2/2 – 100%
2/2 – 100%
1/1 – 100%
1/1 – 100%
George Rose (to 21 July 2022)
2/2 – 100%
2/2 – 100%
1/1 – 100%
1/1 – 100%
Kerry Williams (to 21 July 2022)
2/2 – 100%
n/a
n/a
n/a
*
Kathleen DeRose was unable to attend the January 2023 Board and Remuneration Committee meetings, due to a prior commitment, which was known before her appointment in November 2022.
**
Jonathan Howell was unable to attend certain Committee meetings in November 2022, and March 2023 Board and committee meetings, due to unplanned surgery.
Attendance at Board and principal committee meetings
Board meetings
The Board meets sufficiently regularly to
discharge its duties, and holds additional
meetings when required, for example for a
specific transaction. Each scheduled meeting
is normally held over two or three days, with
Board committee meetings also taking place
during this time. Spending this time together
further enhances the effectiveness of the
Board and its committees and contributes
to the cohesive and collegiate Board culture.
The Board met overseas twice this year,
which allowed management and employees
to present to it and to meet the directors
informally. In September 2022, the Board spent
three days in São Paulo, Brazil, and held Board
and committee meetings during the visit and
reviewed the Latin America strategy. The
Board spent time at our North America
operational headquarters in Costa Mesa,
California, USA, in January 2023. In July 2022,
the Board also travelled to the UK and visited
our UK and Ireland operational headquarters
in Nottingham, and reviewed the regional
strategy with management before holding
Board and committee meetings in Dublin,
Ireland.
May
Board and
committee meetings
July
Board and
committee meetings, and
strategy presentations from
UK and Ireland regional
management
September
Board and
committee meetings
in Brazil, briefings and
presentations and review of
Latin America strategy
November
Board and
committee meetings
January
Board and
committee meetings in the
USA, including two days
of strategy presentations
from global and regional
management
March
Board and
committee meetings,
and Global Technology and
ESG strategy updates
Corporate governance report
continued
Experian plc
Governance
98
Code principle
Board Leadership and Company Purpose
A. Strategy and management
a
Evaluated and debated presentations from
management during the two-day strategy
presentations, approved the Group’s
strategy, and also reviewed and supported
the Group’s ESG strategy.
a
Received and considered key initiatives and
strategy updates as part of the ongoing
strategic planning cycle, and deep-dive
competitor and venture updates.
a
Reviewed operational and financial updates
from the Chief Executive Officer, the Chief
Operating Officer and the Chief Financial
Officer at each scheduled Board meeting –
these included trading, consumer credit,
people and ESG updates, as well as details
of global key initiatives, new business and
competitors.
a
Reviewed monthly Board reports, including
details of performance against budget and
the Group’s financial position, and
stakeholder updates.
a
Reviewed and approved a proposal
regarding the Group’s cloud policy, which is
a key foundational element in delivering
enhanced competitive advantage.
a
Discussed and reviewed market volatility,
inflation sensitivity and tax updates with
senior management.
B. Structure and capital/Financial
reporting and controls/Risk
management
a
Approved the Group’s Annual Report and
full-year and half-year financial results and
carefully considered dividend payments and
a share purchase programme.
a
Approved the annual update to the Group’s
Euro Medium Term Note programme, and
the issue of notes.
a
Discussed and approved the Group’s budget
presentation for FY24 and received updates
on Group insurance and pension
arrangements.
a
Considered and approved the viability
statement for inclusion in the Annual Report.
a
Reviewed risk reports, the appropriateness
of preparing the financial statements on the
going concern basis and the Audit
Committee’s advice on making a ‘fair,
balanced and understandable’ (FBU)
statement in the Annual Report.
a
Reviewed and discussed regulatory and
compliance matters with the Group General
Counsel and the Chief Global Privacy, Ethics
and Regulatory Compliance Officer at Board
and Audit Committee meetings, including
updates on ongoing engagement, current
issues, potential impacts and plans.
a
The Audit Committee received, considered
and approved strategic updates from
Experian’s key second line of defence
functions – Group Risk, Cyber Security, and
Privacy, Ethics and Compliance.
a
Reviewed and approved risk appetite
statements for the Group.
C. Contracts
a
Reviewed and discussed the corporate
development pipeline at each Board
meeting, including an update at the July
2022 Board meeting on our minority
investment programme, which provides
unique insight and knowledge into emerging
trends in technology and business models.
a
Approved the acquisition of the remaining
stake in the Arvato Financial Solutions Risk
Management Division and the acquisition of
Flexpag, a Brazilian company specialising in
digital payment solutions for utilities bills.
a
Conducted formal post-investment reviews
on acquisitions that were completed in 2020,
including RewardStock, Tapad and the initial
60% purchase of the Arvato Financial
Solutions Risk Management Division.
D. Communication
a
Reviewed investor relations, external
communications and media updates at each
scheduled Board meeting, and reviewed and
discussed a market and investor update
from corporate brokers.
a
Reviewed and discussed draft full-year and
half-year financial results presentations for
analysts and institutional shareholders.
a
The Remuneration Committee Chair met
with the Experian People Forum in the UK in
March 2023.
a
More detail is contained in the Shareholder
and stakeholder engagement section,
including details of Chair/shareholder
meetings.
E. Board membership/Delegation
of authority/Corporate governance/
Policies
a
Considered the annual environmental, and
health and safety, updates and approved
associated policy statements.
a
Discussed the external Board evaluation
findings and agreed areas of focus,
authorised Board members’ potential
conflicts of interest and approved the
election and annual re-election of Board
members.
a
Considered and approved the Notice of
Annual General Meeting (AGM) for issue to
shareholders, and the arrangements for the
2022 AGM.
a
Received details of Board members’
external appointments and share dealings,
and updates regarding a shareholder
reunification programme.
a
Reviewed and approved the Group’s tax and
treasury policies.
What did the Board do this year
A
B
C
D
E
F
A. Strategy and management
B. Structure and capital/Financial reporting
and controls/Risk management
C. Contracts
D. Communication
E. Board membership/Delegation of
authority/Corporate governance/Policies
F. Other
The Board’s key activities during
the year were:
99
Experian plc
Annual Report 2023
Governance
Code principle
Board Leadership and Company Purpose
Culture
The UK Corporate Governance Code
emphasises the importance of the role of
the Board regarding culture, with specific
recommendations that the Board assesses
and monitors culture, and ensures that
workforce policies, practices and behaviours
are aligned with the Company’s purpose,
values and strategy. We are confident that the
information the Board and its committees
review, the activities that Board members
engage in, and Experian’s existing structures
and processes, mean that Experian and the
Board are meeting the recommendations
of the Code.
One of the primary ways the Board can
experience, assess and evaluate culture
is through meeting with colleagues in the
business. This year, we were able to achieve
this with the Board meeting senior regional
leaders and employees in Nottingham, UK,
São Paulo, Brazil and Costa Mesa, USA.
As well as this, the Board continued to engage
with employees as much as possible during
the year: for example, all Group Operating
Committee members attended the strategy
presentations with the Board in January 2023,
and the Board received a number of updates
from management during the year.
As part of their induction programmes,
Kathleen DeRose and Louise Pentland visited
the Experian DataLab in the USA. Alison
Brittain, our Remuneration Committee Chair,
met in person with the Experian People Forum
in Nottingham, UK in March 2023. In addition,
to celebrate International Women’s Day 2023,
employees were invited to join Brian Cassin
and Jennifer Schulz (Chief Executive Officer,
North America) for an interactive webcast
discussion with Kathleen DeRose and Louise
Pentland, two of our non-executive directors,
to hear their stories. Employees were also
given the opportunity to mark International
Women’s Day by being asked to nominate
women who had been an inspiration,
supportive, had excelled in their achievements
or had gone above and beyond. Management
encourages all employees to challenge gender
stereotypes, call out discrimination, draw
attention to bias, and seek out inclusion.
Each year at its September and March
meetings, the Audit Committee reviews calls
made to the Confidential Helpline. All calls
are investigated by Global Internal Audit,
in conjunction with HR or Compliance, as
appropriate. As the business has moved to
a hybrid model of working, communications
have been reviewed and refreshed to ensure
sufficient awareness of the Confidential
Helpline. This includes notifications in different
languages, inclusion in email newsletters,
computer lock screens, and email and intranet
reminders.
In addition to the above, Experian and the
Board promote a positive and supportive
culture in other ways, including:
a
Turkey and Syria were hit particularly hard
with a devastating earthquake in February
2023. Experian has employees who are
from that region and who have relatives
and friends that were impacted. Our top
priority was the safety and health of our
employees as well as their loved ones
and we monitored the situation closely.
The Experian Cares Fund (which provides
financial assistance) is available for
employees or their immediate family, should
they have been affected by a traumatic life
event, such as a natural disaster, accident,
domestic abuse, illness or other unforeseen
circumstances. Ahbap, a well-known local
NGO, supported people affected by the
earthquake in accessing first aid, shelter,
and essential products and rebuilding
their homes. Experian made a corporate
donation and was able to facilitate and
match employees’ donations directly to
Ahbap via Benevity, our online giving portal.
Lunar New Year event in California attended by the Board.
Kathleen DeRose and Louise Pentland visited the Experian DataLab in the USA.
Corporate governance report
continued
Experian plc
Governance
100
Code principle
Board Leadership and Company Purpose
Who
What
The Board
a
The Chief Executive Officer’s report, circulated before every scheduled Board meeting, contains a detailed People update,
which includes culture, and an ESG update.
a
The Board regularly considers the results of people sentiment and pulse surveys.
a
Board meetings in FY23 in São Paulo, Brazil and Costa Mesa, California enabled the Board to engage with employees and
senior regional management. The Board also spent time with our UK and Ireland business and colleagues in July 2022.
Board members
a
Visiting Group business locations enables the Board to spend time with employees of varying seniority and assess
culture in a local context. All Board meetings during the year were held in person, and these allowed the Board to engage
with the business.
a
Two of our new non-executive directors, Kathleen DeRose and Louise Pentland, spent time at the DataLab in San Diego,
California as part of their induction programme in January 2023.
Audit Committee
a
The Committee’s oversight of interactions with government and regulators, and the perspective provided by Global
Internal Audit, can give an indication of culture. The Committee and the Board receive relevant updates at every meeting,
and management is transparent and responsive to challenge.
a
Twice a year, the Committee reviews calls made to the Confidential Helpline.
Remuneration Committee
a
The Committee reviews an ‘Overview of employee pay and related policies’ paper, designed to provide an overview of pay
structures at Experian and their alignment with our purpose, values and strategy. This allows the Committee to ensure
that relevant policies and practices are consistent with Experian’s values.
a
The Committee Chair met with the UK and Ireland Experian People Forum in March 2023, and feedback was provided to
the Board. The key points/topics from the update included employee feedback on how the Company had addressed the
issue of cost-of-living support and broader reflections on culture in Experian.
a
The Committee reviews our UK gender pay gap disclosures every year, on behalf of the Board.
Nomination and Corporate
Governance Committee
a
In January 2023, the Committee considered the annual People Strategy, Talent and Culture update from the Chief People
Officer, which included details of global people strategy progress, talent and leadership, culture and the employee value
proposition, and the priorities for FY24.
a
The Committee also received a DEI update from the Chief People Officer and Global Chief DEI Officer which included
details on DEI progress, diversity in senior leader hires and an update on the three-year strategy.
Additional ways that the Board monitors and assesses culture
a
During the year, Experian partnered with
Out & Equal in our commitment to build a
more inclusive workplace. The Out & Equal
Workplace Summit is a recognised event
that brings together corporate, government
and non-profit leaders from around the
world to advance workplace fairness for
LGBTQ+ employees. At the summit, leaders
from our Experian Pride Employee Resource
Group (ERG) participated in several panel
discussions focused on improving diversity
and inclusion efforts for LGBTQ+ employees.
We also shared the ways we are building
financial products to improve financial
inclusion for underserved communities
with Experian Boost and Experian Go.
Scan me
To view the video: Experian’s
Partnership with Out & Equal is
#Unstoppable
a
Experian is committed to having the right
range of resources available to support
employees’ mental wellbeing. We now have
a community of over 400 certified Mental
Health First Aiders; we are training our HR
Business Partners across Experian; we have
a Global Wellbeing Hub that brings together
all global and regional resources, and tools
around wellbeing; and we have Employee
Assistance Programmes (EAPs) in each of
our regions to help our people be mentally
well and thrive within the business. This
approach sits at the heart of our broader
Diversity, Equity and Inclusion (DEI)
commitment, which is about helping people
be their whole self at work.
>
400
certified Mental Health First
Aiders; we are also training our
HR Business Partners across
Experian
US$9bn
Experian has helped millions
of people settle nearly US$9bn
of debt
a
Experian empowers consumers with social
innovation. The heart of Experian is
ultimately to innovate new products and
services that help people improve their
financial health and progress in their
financial lives. For example, in Brazil, our
product Limpa Nome helps people engage
with banks to help them settle old debts that
are still held against them. This year
Experian has helped millions of people
settle nearly US$9bn of debt.
101
Experian plc
Annual Report 2023
Governance
Code principle
Board Leadership and Company Purpose
Global Delegated Authorities Matrix
This key Group governance document
comprises the schedule of matters reserved to
the Board, the Board committees’ terms of
reference and the authority levels for the
Group’s principal subsidiaries, directors and
senior executives. For matters not reserved to
the Board, the matrix prescribes the cascade
of authorities delegated throughout the Group
by respective Group companies, together with
their monetary limits. The Board monitors the
exercise of delegations to the Group’s principal
subsidiaries, which are reported to it at each
Board meeting. Regional matrices are also in
place.
Governance framework
Corporate governance report
continued
Delegated authority flow
Executive committees/functions
Group Operating Committee (OpCo)
Risk management committees (executive and regional)
Tax and Treasury Committee (TTC)
Environmental, Social and Governance (ESG) Steering Committee
Strategic project committees (global and regional)
Global Internal Audit (GIA)
Board committees
Board
Executive
management team
Operating
businesses
Principal subsidiaries
These are Group companies to which the Board has delegated
certain decision-making powers, for example: implementing
decisions agreed in principle by the Board; executive
management of the operations of the Group within the strategy
and budget approved by the Board; acquisitions and disposals
with a value up to US$50m; and capital expenditure projects.
See Board of
directors
on pages 92
to 93
Nomination and Corporate
Governance Committee
Audit Committee
Remuneration Committee
See report on
page 108
See report on
page 113
See report on
page 121
The OpCo comprises the most senior executives from the Group. Its remit includes identifying, debating and achieving
consensus on issues involving strategy, growth, people and culture, and operational efficiency. It also focuses on
ensuring strong communication and co-operative working relationships among the top team. Its meetings tend to be
issues oriented and focus on selected Group issues worthy of debate.
a
Executive Risk Management Committee (ERMC)
comprises senior Group executives, including the executive
directors and the Company Secretary. Its primary responsibility is to oversee the management of global risks.
The regional risk management committees oversee the management of regional risks, consistent with Experian’s
risk appetite, strategies and objectives, and are comprised of senior regional leaders.
a
Security and Continuity Steering Committee (SCSC)
is a sub-committee of the ERMC. The SCSC’s primary
responsibility is to oversee management of global information security, physical security, and business continuity
risks, consistent with Experian’s risk appetite, strategies and objectives.
The dedicated ESG committee comprises senior executives from a wide range of areas throughout the Group, and is
chaired by the Chief Financial Officer. The purpose and primary duty of the ESG Steering Committee is to support the
definition, approval and integrated delivery of the Group’s ESG strategy.
This committee comprises senior executives with financial and tax expertise, and includes the Chief Financial Officer.
The TTC oversees the management of financial risk, including tax, liquidity, funding, market and currency risks.
These committees comprise the most senior global and regional executives. Their remit is to oversee a process to
ensure that all strategic projects are appropriately resourced, risk assessed and commercially, financially and
technically appraised. A similar body, the Investment Committee, performs the same function in respect of proposals
regarding minority investments. Depending on the outcome of the discussions, the committees’ conclusions are then
considered by the board of the relevant Group company for approval.
GIA conducts a range of independent audit reviews throughout the Group during the year and is represented at each
Audit Committee meeting. GIA’s plans, results and key findings are presented to, and discussed with, the Audit
Committee. The internal audit programme and methodology are aligned to the risk categories and risk assessment
parameters established by Global Risk Management. GIA also makes use of risk assessment information at a business
level, in planning and conducting its audits.
Experian plc
Governance
102
Code principle
Board Leadership and Company Purpose
The Code principles regarding the role of the Chair, the desired characteristics of the Chair and his/her duty regarding Board relations and
contributions are outlined in the Chair’s letter of appointment. A summary appears in the table below. The table also summarises how there is a clear
division of responsibilities between the leadership of the Board and the executive leadership of the business.
Chair
Mike Rogers
a
Runs the Board effectively and ensures that the Board plays a full and constructive part in developing and determining
the Group’s strategy (including ESG strategy) and overall commercial objectives
a
Promotes the highest standards of integrity, probity and corporate governance throughout the Group and particularly at
Board level
a
Ensures that the Board receives accurate, timely and clear information on the Group’s performance and its issues,
challenges and opportunities
a
Ensures effective communication with the Company’s shareholders by the CEO, the CFO and other executive
management; and ensures that the Board develops an understanding of the views of the Company’s major shareholders
a
Facilitates the non-executive directors’ effective contribution to the Board, and ensures constructive relationships
between the executive and non-executive directors
a
Primarily responsible for the Board’s leadership and governance, and ensures its effectiveness
Chief Executive Officer (CEO)
Brian Cassin
a
Responsible for the Group’s day-to-day business, in line with the strategy, risk profile, objectives and policies set by the
Board and its committees
a
Accountable to the Board for the Group’s development and its operations
a
Runs the Group’s business and develops the Group’s strategy (including ESG strategy) and overall commercial objectives
a
Implements, with the executive team, the decisions of the Board, its committees and the principal subsidiaries
a
Maintains a dialogue with the Chair on the important and strategic issues facing the Group, and alerts the Chair to
forthcoming complex, contentious or sensitive issues
a
Leads the communication programme with shareholders
a
Chairs the Group Operating Committee
Chief Financial Officer (CFO)
Lloyd Pitchford
a
Responsible for managing the financial affairs of the Group, including tax, corporate finance and treasury
a
Works closely with the CEO and COO to manage the Group’s operations, and oversees information security and
operational risk management
a
Acts as executive sponsor of the Group’s overall ESG programme and chairs the Group’s dedicated ESG Steering
Committee
a
Member of the Group Operating Committee
Chief Operating Officer (COO)
Craig Boundy
a
Oversees the Company’s business operations
a
Ensures the Group has effective operational procedures and controls
a
Responsible for driving the evolution of the Group’s technology and innovation strategy
a
Member of the Group Operating Committee
Senior Independent Director
Alison Brittain
a
Provides support and guidance, acts as a sounding board for the Chair, and serves as an intermediary for other directors
a
Acts as a contact point for shareholders if they have concerns which are not resolved through discussion with the Chair,
CEO or CFO
a
Evaluates the performance of the Chair
Non-executive directors
Alison Brittain, Kathleen DeRose,
Caroline Donahue, Luiz Fleury,
Jonathan Howell, Esther Lee,
Louise Pentland
a
Constructively challenge and help develop Group strategy
a
Scrutinise management performance against agreed goals and objectives
a
Uphold the highest standards of integrity and probity and support the Chair in instilling the appropriate culture, values
and behaviours in the Group
a
Ensure the integrity of financial information and that there are robust financial controls and systems of risk
management; determine executive remuneration and succession planning
Group Company Secretary
Charles Brown
a
Secretary to the Board and its committees
a
Provides support and guidance to the Board and the Chair, and acts as an intermediary for non-executive directors
a
Responsible for: corporate governance; listing rules, prospectus rules, and disclosure guidance and transparency rules
compliance; statutory compliance and reporting; shareholder services; and sustainability
a
Member (and secretary) of the Group Operating Committee
Group General Counsel
Darryl Gibson
a
Responsible for overseeing Experian’s global legal, regulatory compliance and government affairs functions
a
Provides the Board and Audit Committee with legal advice, leads on legal and regulatory reporting, and active in public
policy advocacy
a
Member of the Group Operating Committee
Division of responsibilities
103
Experian plc
Annual Report 2023
Governance
Code principle
Division of Responsibilities
Timeline of shareholder engagement
Shareholder and stakeholder
engagement
The UK Corporate Governance Code
encourages boards to have a clear
understanding of the views of shareholders.
Companies are also encouraged to seek
regular engagement with major shareholders
in order to understand their views.
In addition, the Code states that the Board
should understand the views of the Company’s
other key stakeholders and describe how their
interests have been considered in discussions
and decision-making. Details regarding key
stakeholders are on page 105.
Shareholders
We are committed to open and regular
communication and engagement with
shareholders at any time of the year, and our
communications with shareholders (and proxy
advisory bodies) will always offer invitations
to meet with the Chair or any of the Board
Committee chairs.
Board
– Investor relations, and external
communications and media, reports are
circulated before every Board meeting.
The investor relations report contains a
commentary on key events in Experian’s
main markets, share price performance,
market movements, investor feedback from
management/analyst meetings, broker and
analyst forecasts and recommendations,
investor relations activities (including ESG),
and shareholder analysis. The external
communications and media update provides
details of the focus of external communication
activities, which has included innovation,
financial health, data security and integrity,
and people. The Chief Communications Officer
provides regular updates at Board meetings.
Engagement with investors
– The Chair of the
Remuneration Committee wrote to our major
shareholders and the main UK and US proxy
advisory bodies in November 2022 and again
in February 2023. She outlined the changes
made to the Remuneration Policy since 2017
and our continued commitment to employee
support. The Board Chair also made himself
available to meet with shareholders during the
year, and met with shareholders to discuss
governance, strategy and risk oversight.
Investors and analysts
– The executive team
runs an ongoing programme of dialogue with
institutional investors and analysts, through
which they discuss a wide range of issues
including strategy, performance, management
and governance. Experian also engages with
investors through industry conferences and
by hosting events with members of the senior
management team. The announcements of
the full-year and half-year results and trading
updates provide opportunities for us to answer
questions from analysts, covering a wide
range of topics. This year, executive
management attended conferences and
investor meetings virtually and in person
(Scotland and London).
Annual General Meeting
– The AGM provides
a valuable opportunity for the Board to
communicate with shareholders. The majority
of directors attended the 2022 AGM, including
the Audit, Remuneration, and Nomination and
Corporate Governance Committee chairs.
The 2023 AGM will take place on Wednesday
19 July 2023 in Dublin, Ireland. Shareholders
are encouraged to use proxy voting on the
resolutions put forward, all of which (except
for procedural resolutions) are taken by a poll.
In 2022, voting levels at the AGM were 75.89%
of the Company’s issued share capital.
Private shareholders
– The Company
Secretary, Charles Brown, oversees
communication with private shareholders, and
ensures direct responses as appropriate in
respect of any matters raised by shareholders.
The Company issues a ‘Shareholder Questions’
card each year, together with the AGM
documentation. The Company responded to
shareholders directly, as appropriate, following
the 2022 AGM.
Investor relations app
– This contains
information about our financial performance,
together with reports, presentations and news
of upcoming events.
Website
– Our website is an important channel
for communicating with all stakeholders,
including shareholders. All material
information reported to the regulatory news
services is published at
www.experianplc.
com/investors/regulatory-news
, together
with copies of full-year and half-year results
announcements and trading updates.
1 April
2022
11 May
21 Jul
31 March
2023
Feb
19 May to
9 June
23 June
17 Nov
to 5 Dec
31 Jan to
2 Feb
20-24 Feb
Scotland,
London and
virtual
20 Jul
15 Sep
10 Nov
Nov
26 Jan
21 Mar
Remuneration engagement
ESG virtual roadshow
Wealth roadshow
Investor virtual conferences and meetings
I
nvestor and media relations reports provided to the Board
AGM
Corporate governance report
continued
Experian plc
Governance
104
Code principle
Division of Responsibilities
Information on Group-wide engagement with key stakeholders is on pages 16-19 in the Strategic report. Board activities regarding key stakeholders,
including engagement, are summarised in the table below. Shareholder engagement has been considered earlier.
Stakeholder
Responsibility
Relevant activities during FY23
Summary of stakeholder views/actions
Our clients and
consumers
Board
a
The Board report in March includes an
update on clients and consumers,
including (for clients) Net Promoter
Score (NPS) metrics, top-performing
NPS attributes and areas that require
improvement.
a
For consumers, the reporting includes
brand awareness, trust in the Experian
brand and the level of complaints.
a
A large number of our clients strongly agree that we are an innovative
company.
a
Our brand and reputation as a Trusted Company ranked as the most
important brand driver for the seventh year in a row.
a
Our account management achieved the highest ratings across the
client journey.
Our communities
Board
a
The Chief Executive Officer reports on
ESG and our actions to support our
communities at each scheduled Board
meeting.
a
The Chief Sustainability Officer
presented an ESG strategic update to
the Board in March 2023.
a
The ESG Steering Committee is chaired by the Chief Financial Officer,
Lloyd Pitchford, and brings together the work undertaken across the
Group into one, co-ordinated programme.
a
Scope 1 and 2 carbon emissions have reduced by 65% since 2019.
a
Our community investment contributions totalled US$17.6m this year,
exceeding our annual goal of 1% of benchmark profit before tax,
including US$1m in cash and product donations contributed to various
non-profit agencies to help refugees displaced by conflict. Experian
employees volunteered 47,000 hours of their time (in and outside
working hours) to help their communities, including sharing their
expertise to support programmes designed to improve financial
health.
Our people
Board, Nomination
and Corporate
Governance
Committee,
Remuneration
Committee
a
People and sentiment survey and Pulse
survey updates to the Board.
a
Board reporting at every scheduled
Board meeting (People section of Board
report).
a
People Strategy, Talent and Culture
update to the Nomination and Corporate
Governance Committee.
a
Direct feedback to the Board from
Alison Brittain, Remuneration
Committee Chair, who met with the UK
and Ireland Experian People Forum in
March 2023.
a
Confidential Helpline updates to the
Audit Committee.
a
Taking part in the Great Place to Work survey globally for a second
year. Last year’s feedback resulted in the launch of our Career Hub
alongside our global Careers Week; more regular and ongoing career
development and growth conversations; a stronger focus on Diversity,
Equity and Inclusion; and over 400 people being trained as Mental
Health First Aiders to increase our wellbeing support globally.
a
We run regular global Pulse surveys, so we can keep finding
opportunities to improve our people’s experience at Experian.
a
A confidential helpline, facilitated by an external provider, is available
for employees who wish to raise any concerns. Calls to the
Confidential Helpline, and any actions required, are reviewed by
the Audit Committee, in conjunction with HR or Compliance, as
appropriate, at least every six months.
Our suppliers
Board
a
Annual update to the Board on
suppliers, which includes details of
digitalisation, engagement, the Group’s
Supplier Relationship Management
(SRM) programme and the Global
Procurement Hub.
a
Annual Board review of the Group’s
Modern Slavery Statement as
presented by the Global Chief
Procurement Officer.
a
During the year we approached 98 suppliers to complete
questionnaires and then conducted follow-up discussions with 13 of
them to further understand their responses and share best practice
on modern slavery and employment practices.
a
We continue to develop our reporting capabilities, creating interactive
dashboards to help identify opportunities, better understand spend
and enable us to see trends. FY24 will see an increase in the pace of
automation of our administrative processes.
a
Our SRM programme has been refined and continues to develop.
We focused on 25 key suppliers with regular, collaborative meetings
(sponsored by senior executives). The meetings focused on
performance and opportunities for deeper collaboration.
Government
Board, Audit
Committee
a
Board members receive regular Board
and Audit Committee updates from the
Group General Counsel regarding
regulatory engagement, and any
ongoing regulatory matters.
a
There is ongoing privacy, ethics and
compliance reporting to the Audit
Committee, including Compliance
training.
a
Audit Committee risk management
reporting includes legislative/
regulatory matters. Any relevant
government affairs matters are also
considered by the Audit Committee
and the Board.
a
There were ongoing regulatory inquiries in respect of certain matters
during the year, and the Board and Audit Committee receive regular
updates on the matters being considered by regulators. Our response
to these inquiries takes into consideration the regulatory position on
the relevant inquiry.
a
Updates were provided to the Board and Audit Committee on a
number of matters, as well as engagement with regulators including
the UK Financial Conduct Authority, and the US Consumer Financial
Protection Bureau.
Other stakeholders
105
Experian plc
Annual Report 2023
Governance
Code principle
Division of Responsibilities
Workforce engagement
The UK Corporate Governance Code requires
companies to select one or a combination of
prescribed methods for the Board to engage
with the workforce. If a particular method is
not appropriate for a company, it may explain
the alternative arrangements in place and why
these are considered effective. The Board has
always felt well informed about workforce
views and matters, including in relation to
pay and related policy arrangements for the
broader employee population. As a result,
no single approach recommended in the Code
was considered appropriate for our business.
The Board instead adopted a combination
of methods to comply with the Code’s
requirements. These are summarised below,
and include:
a
There are regular people and sentiment
survey updates to the Board, and reporting
at every scheduled Board meeting on people
matters. People, talent and culture updates
are also provided to the Nomination and
Corporate Governance Committee, offering
a valuable insight into workforce matters.
a
Any relevant business cases reviewed by
the Board include an evaluation of potential
impacts of the transaction on the Group’s
stakeholders, including employees.
a
The Remuneration Committee annually
considers an extensive paper setting out
details of all-employee pay and workforce
policies across Experian. The discussions
on this topic provide helpful insights for
framing pay considerations.
a
The Remuneration Committee Chair
annually attends a meeting of the UK and
Ireland Experian People Forum (see Our
people, in the table on page 105), providing
the opportunity to gain first-hand feedback
in two-way discussions with the workforce,
which is invaluable. The employee insights
and views gathered are shared with the full
Board, allowing the Board to hear directly
from the wider workforce.
a
The Board meets with employees in person
outside the Boardroom environment during
the year.
In coming to this approach, the Board is
satisfied that the approach is appropriate for
Experian and that the Board keeps workforce
considerations to the fore in its deliberations.
Considering our stakeholders in our
decision-making
The Code also recommends that the Board
should describe how stakeholder interests
have been considered in Board discussions
and decision-making. We have processes in
place to capture and consider stakeholders’
views (including the matters contained in
Section 172 of the UK Companies Act 2006, on
a voluntary basis) and feed them into Board
decision-making.
All material business cases considered in the
Group (for example, mergers, acquisitions and
major capital investments) include an analysis
of the stakeholder considerations, anticipated
impact and mitigations. This process helps the
Board to perform the duties outlined in Section
172 of the UK Companies Act 2006 and
provides assurance to the Board that
potential impacts on stakeholders have been
considered in the development of the proposal.
The impact on stakeholders, their views and
their feedback are collectively at the heart
of Board discussions and actions. The Board
will continue to enhance ways to ensure that
stakeholders are given consideration as part
of the Board’s decision-making.
An example of how this process works in
practice is outlined below, where Board
consideration of a strategic acquisition
included a review of the standing stakeholder
impact analysis.
Acquisition of the remaining 40% stake
in the Arvato Financial Solutions Risk
Management Division from Arvato
Financial Solutions (AFS)
In June 2020, Experian acquired 60% of the
Arvato Financial Solutions Risk Management
Division from Arvato Financial Solutions (AFS),
creating the Experian DACH Joint Venture.
In November 2022, the Board reviewed,
considered and approved the early buyout of
AFS’s 40% stake ahead of the pre-determined
option date. Experian DACH is one of the
leading bureaux in Germany, a vertical leader
in the insurance, financial services,
telecommunications, e-commerce and
payments verticals. The bureau’s competitive
advantage comes from the exclusive operation
of an insurance claims data pool, while
negative data is sourced from suppliers,
including exclusive supply from AFS’s German
Debt Collection Agency (DCA) which is the
second largest in the market.
Timeline of workforce engagement
Corporate governance report
continued
1 April
2022
31 March
2023
9 Nov
19 Jul
13 & 14
Sept
24, 25 & 26
Jan
29 Mar
11 May
20 Jul
15 Sept
10 Nov
26 Jan
21 Mar
All-employee pay and workforce policies review
UK and Ireland Experian People Forum (face-to-face meeting)
People, talent and culture Board update; people and
sentiment survey updates and people matters reporting
Board visits to various business sites
Experian plc
Governance
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Code principle
Division of Responsibilities
A briefing paper was circulated to the Board
ahead of its November 2022 meeting, outlining
the strategic rationale for the transaction, as
well as the financial evaluation and deal
structure. The Group’s Chief Investment Officer
attended the meeting and presented, with the
Chief Executive Officer, the business case to
the Board. At the EMEA/Asia Pacific regional
level, and as part of the FY24 Strategic plan
preparation, we considered how we might
position Experian DACH as a platform for
growth. In considering the acquisition, the
Board reviewed the stakeholder impact
analysis which had been prepared (and which
is prepared for all acquisition business cases).
The analysis identified the following
stakeholder impacts and actions/mitigations:
a
Full Experian ownership would result in
stronger cultural alignment and certainty
over identity. As part of a Value Creation
Plan to drive growth for the business
under our full ownership, employees
would continue to be treated fairly and
in accordance with the relevant laws
and conditions applicable.
a
Customers and suppliers were expected
to react positively, having access to the
breadth of Experian’s global products
and data services.
a
There was no material community or
environmental impact anticipated.
a
The full acquisition was expected to have
a meaningfully positive long-term impact
on the stakeholders.
Workforce policies and practices
The Board is expected to ensure that:
workforce policies and practices are
consistent with the Company’s values; that
they support its long-term sustainable
success; and that the workforce can raise
any matters of concern. An example of the
alignment of policies and practices is how
the Group manages anti-bribery and
anti-corruption.
A strong compliance culture at the heart of our
strategy helps ensure that we comply both
with the laws that apply to our business and
with our Global Code of Conduct. The Board
sets the tone and leads by example and is
one of the most important influences on the
Company’s commitment to preventing bribery
and corruption.
Our Anti-Corruption Framework sets out
our zero-tolerance policy on bribery and
corruption in any form, and this message is
reinforced through mandatory annual training
for employees. We also extend this framework
to our third-party network and business
partners, which helps to instil our values
in every aspect of our business.
In terms of the ability to raise matters of
concern, Experian is committed to achieving
the highest possible standards of quality,
honesty, openness and accountability, and
there is an expectation that employees
maintain high standards in accordance with
the Global Code of Conduct. There is also a
culture of openness and accountability, and all
employees are encouraged to raise any
concerns about the way in which the business
is run at an early stage so that any concerns
can be dealt with effectively. A confidential
helpline, facilitated by an external provider, is
available for employees who wish to raise any
concerns. Calls to the Confidential Helpline,
and any actions required, are reviewed by the
Audit Committee at least every six months.
Non-executive director appointment
Non-executive directors are initially appointed
for three years. This may, subject to
satisfactory performance and election or
re-election by the shareholders, be extended
by mutual agreement. They normally serve
for a maximum of nine years, through three
terms, each of three years’ duration.
Meetings of non-executive directors
In addition to attending Board and committee
meetings, the non-executive directors
normally meet separately with the Chair, and
often also with the Chief Executive Officer,
at the end of each scheduled Board meeting.
The non-executive directors also meet
privately at least once a year with the Senior
Independent Director, without the Chair
present, and did so once during the year
to discuss matters including the Chair’s
performance.
Board information
All directors receive financial and operational
information each month to help them
discharge their duties. Board papers are
circulated digitally at least one week before
each Board meeting, to ensure directors have
time to review them. Directors have access
to independent professional advice at the
Company’s expense, if they consider it
appropriate. No director obtained any such
advice during the year ended 31 March 2023.
Independence
As required by the Code, the Board considers
each of the non-executive directors to be
independent in character and judgment and
believes there are no relationships or
circumstances that are likely to affect (or could
appear to affect) each director’s judgment.
Conflicts of interest, and external
appointments
The Company’s articles of association allow
the Board to authorise actual or potential
conflicts of interest. The authorisation
procedure involves Group Corporate
Secretariat issuing guidance and a
questionnaire each August, asking directors
to identify any conflicts or potential conflicts,
which the Board then considers at its
September meeting. In addition, directors are
expected to advise the Company Secretary of
any actual or potential conflicts as soon as they
arise so the Board can consider them at the
next available opportunity. In the Board’s view,
this procedure operated effectively during
the year under review. The Board also has a
process in place whereby directors’ proposed
external or additional appointments are
reviewed and considered for approval by
the Board.
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Experian plc
Annual Report 2023
Governance
Code principle
Division of Responsibilities
Nomination and Corporate Governance Committee report
Mike Rogers
Chair of the Nomination and Corporate
Governance Committee
We spent a significant amount of
time considering the recruitment of
three new non-executive directors,
which has strengthened our ability
to facilitate constructive challenge,
opinion, and openness and diversity.
Members
Mike Rogers (Chair)
Alison Brittain
Kathleen DeRose
Caroline Donahue
Luiz Fleury
Jonathan Howell
Esther Lee
Louise Pentland
The Committee has maintained its focus on the
executive talent pipeline and senior
management succession plans, reflecting the
Board’s responsibility to ensure appropriate
plans are in place. A succession planning
update was provided at a number of
Committee meetings. Included in the updates
were reviews of executive management
succession coverage. The Committee valued
receiving these analyses of the Experian talent
development structure, and how it influences
Experian’s culture.
During the year, on the recommendation of the
Committee, we welcomed Craig Boundy,
Kathleen DeRose, Louise Pentland and Esther
Lee as new directors, and Kerry Williams,
Deirdre Mahlan, George Rose and Dr Ruba
Borno stepped down as directors. Craig
replaced Kerry as an executive director of the
Company in July 2022 (having taken over as
Chief Operating Officer on 1 April 2022). Craig
had successfully led Experian's North America
region for seven years, having joined Experian
in November 2011 to lead the UK and Ireland
region, and has operated in a variety of leading
management positions. Kathleen and Louise
were appointed to the Board on 1 November
2022, as independent non-executive directors.
As well as bringing significant FinTech
experience to the Experian Board, Kathleen
brings financial services expertise with a focus
on investment management. Louise brings
significant legal and regulatory experience
from FinTech, technology and digital industries.
Esther joined the Board on 31 March 2023 as
an independent non-executive director, and
she is very well placed, qualified and
experienced to support Experian with her
extensive knowledge of consumers and
insights into their needs. Each new
appointment brings a wealth of experience
from a wide range of international businesses
and has a great deal to offer Experian. They
have considerable executive and non-executive
listed boardroom experience, which will
further enhance the strength, depth and
effectiveness of the Board. Jonathan Howell
became Chair of the Audit Committee on 1 July
2022, in place of Deirdre Mahlan, and on
21 July 2022, Alison Brittain was appointed as
our Senior Independent Director and Chair of
the Remuneration Committee, replacing
George Rose.
These Board changes coincided well with
the timing of our external Board evaluation
(recommended at least every three years in
the Code). In May 2022, we reviewed and
agreed the timing and approach for the FY23
external Board evaluation and appointed the
external evaluator, Manchester Square
Partners. They had undertaken the FY20
external Board evaluation and this
appointment provided a good level of continuity
for the FY23 external evaluation. You can read
more about the process and outcomes on
pages 111 to 112.
As well as recruiting new Board members,
we continue to ensure that the composition of
the Board and its committees are regularly
reviewed and that there is a balance of skills
and experience, independence and knowledge
on the Board as well as diversity in the
broadest sense, including gender and ethnicity.
As part of the Board’s succession planning, we
reviewed the overall skill sets of the Board,
Board tenure and how the Board works
together as a team. We also considered our
longer-term succession planning and the skills
we would need to 'future proof' the leadership
of the business.
To progress in creating a better tomorrow,
we must also ensure our global DEI strategy
connects with, and supports, the needs of the
regions where we do business. Our deep
commitment to DEI is entrenched throughout
Experian. The Committee received and
discussed a detailed Global People Update
which included the DEI plan from our Chief
People Officer, Jacky Simmonds, and our
Global Chief Diversity, Equity and Inclusion
Officer, Wil Lewis, in January 2023. In FY24 and
beyond, we will continue with our product-
centred approach across the regions while
working to increase diverse representation
and delivering education on why increased
diversity has commercial benefit.
The Committee considered the proposed
election or re-election of directors at the
Annual General Meeting, recommended
Caroline Donahue’s re-appointment as a
director, reviewed the draft corporate
governance section of the Annual Report,
and reviewed various company law and
governance changes.
The Committee was in place throughout the
year ended 31 March 2023.
Committee’s key roles and
responsibilities
Good governance and strong, responsible,
balanced leadership are critical to business
success and to creating both long-term
shareholder value and a strong, sustainable
culture. As a Committee, our responsibilities
include:
a
Ensuring we have appropriate procedures
for nominating, selecting, training and
evaluating directors, and that adequate
succession plans are in place.
a
Reviewing the Board’s structure, size,
composition and succession needs;
considering the balance of membership and
the Board’s required balance of skills,
experience, independence, knowledge and
diversity.
a
Identifying and nominating, for the Board’s
approval, suitable candidates to fill
vacancies for non-executive directors and,
with the Chief Executive Officer’s assistance,
executive directors. Board appointments are
made on merit and against objective criteria,
to ensure the Board maintains its balance of
skills, experience, independence, knowledge
and diversity.
a
Reviewing legislative, regulatory and
corporate governance developments and
making recommendations to the Board; and
ensuring that the Company observes the
standards and disclosures recommended
by the UK Corporate Governance Code.
Composition and experience
a
Mike Rogers has chaired the Committee
since July 2019.
a
The Board considers the Committee
members to be independent
non-executive directors, in line with the
UK Corporate Governance Code.
a
The Committee met six times during the
year ended 31 March 2023.
a
The Chief People Officer, the Chief
Communications Officer and the Global
Chief Diversity, Equity and Inclusion
Officer were invited to attend certain
meetings.
a
The Chief Executive Officer was also
invited to attend all meetings and
provided valuable input to the
discussions.
Link to the Committee
terms of reference
https://www.experianplc.com/
about-us/corporate-
governance/board-committees/
Experian plc
Governance
108
Code principle
Composition, Succession and Evaluation
May 2022
July 2022
September 2022
November 2022
January 2023
March 2023
a
Noted the proposal
that the FY23
external Board
evaluation would be
undertaken by
Manchester Square
Partners, and the
timing and approach
for the evaluation.
a
Received and
considered a Board
succession update.
a
Discussed a detailed
AGM briefing from
the Company
Secretary and the
Chief
Communications
Officer, including
voting results,
shareholder feedback
and engagement that
had taken place in the
lead-up to the AGM.
a
Continued important
discussions
regarding Board
succession, with a
focus on plans
regarding the
potential appointment
of additional
non-executive
directors.
a
Recommended to
the Board the
appointment of
Kathleen DeRose and
Louise Pentland as
independent
non-executive
directors.
a
Approved the
extension of the
search process for a
further non-executive
director.
a
Discussed in detail
the structure, size
and composition of
the Board and its
committees.
a
Reviewed the
Committee’s
performance during
the year against its
terms of reference
and concluded that it
was operating
effectively.
a
Recommended to the
Board the
re-appointment of
Caroline Donahue as
a non-executive
director for a further
three-year term.
a
Reviewed and
discussed a People,
Talent and Culture
update.
a
Reviewed an update
on diversity, equity
and inclusion,
outlining the Experian
philosophy and
approach.
a
Reviewed and
discussed executive
succession, including
succession planning
for senior leaders.
a
Received an update
on the progress of the
non-executive
director search.
a
Received and
considered a Board
succession update.
a
Recommended to the
Board the directors to
be considered for
election/re-election at
the 2023 AGM.
a
Considered the annual
company law and
governance update.
a
Recommended to
the Board the
appointment of Esther
Lee as an independent
non-executive director.
a
Recommended to
the Board the proposed
areas of focus for FY24.
Committee activities in FY23
When making Board appointments, the
Committee reviews and approves an outline
brief and role specification and appoints one or
more search agents for the assignment. We
disclose the name of the search agent and any
other connection they have with Experian in
the Annual Report following the appointment.
The specification and the search are discussed
with the search agents, who then prepare an
initial longlist of candidates. The Committee
defines a shortlist and holds interviews.
Ultimately, the Committee makes a
recommendation to the Board for its
consideration. Following Board approval, the
appointment is announced in line with the
requirements of the UK Financial Conduct
Authority's (FCA’s) Listing Rules. In due course,
a tailored induction programme is developed
for the new director(s). We engaged Odgers
Berndtson as the specialist search firm for the
recruitment of Kathleen DeRose, Louise
Pentland and Esther Lee, who were appointed
during the year. Odgers Berndtson does not
provide additional services to the Group.
Process for Board appointments
Board composition
The Board comprises the independent Chair,
Mike Rogers, three executive directors and
seven independent non-executive directors,
including the Senior Independent Director,
Alison Brittain. Alison is also the Chair of the
Remuneration Committee. Jonathan Howell is
the Chair of the Audit Committee and Mike
Rogers is the Chair of the Nomination and
Corporate Governance Committee. The
Nomination and Corporate Governance
Committee regularly evaluates Board
composition from a number of perspectives,
including diversity and orderly succession.
This year was a busy one for Board
composition, with key Board member changes
during the year. The changes regarding
Committee chairs were carefully planned and
orchestrated over an extended period:
Jonathan Howell was appointed to the Board in
2021 and Alison Brittain was appointed to the
Board in 2020. The non-executive director
succession process has proceeded well, and
there has been an effective transition of Audit
and Remuneration Committee chair roles from
Deirdre Mahlan and George Rose, to Jonathan
Howell and Alison Brittain, both of whom have
brought critical insights and strong
contributions, and stepped easily into their
roles.
Committee reviews and approves an outline
brief and role specification and appoints a
search agent for the assignment
The agent prepares an initial longlist of
candidates
The Committee then considers a shortlist and
we hold interviews
The Committee makes a recommendation to
the Board for its consideration
Following Board approval, the appointment is
announced in line with the requirements of
the FCA’s Listing Rules
Step 1
Step 2
Step 3
Step 4
Step 5
109
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Governance
Code principle
Composition, Succession and Evaluation
The detailed induction programme for Kathleen and Louise is set out below.
Key corporate/governance topics covered
Presenters
Corporate Governance
Company Secretary and external legal counsel
Talent, People and Reward
Chief People Officer
Sustainability
Company Secretary and Chief Sustainability Officer
Financial Overview, Budget & Capital Strategy
Chief Financial Officer
External Audit
KPMG
Global Internal Audit
Head of Global Internal Audit
Global Technology
Group President, Global Technology
Legal, Government Affairs and Compliance
General Counsel and Chief Global Privacy, Ethics &
Regulatory Compliance Officer
Strategic Planning, Competition, and Corporate
Development
Chief Investment Officer and Chief Strategy Officer
Investor Relations, Communication and Brand
Chief Communications Officer
Group Risk
Group Chief Risk Officer and Head of Group Risk
Management
Cyber Security Overview
Global Chief Information Security Officer
Key business/operation topics covered
Presenters
Overview of the Experian Software Solutions
business
Chief Operating Officer and CEO, Experian Software
Solutions
Overview of the Brazil business
Managing Director, Brazil
Overview of the UK and Ireland business
Managing Director, UK and Ireland
Overview of the Consumer Services business
Group President Consumer Services and President
Direct-to-Consumer and Credit Match
Overview of the North America business
CEO, North America
Visit to an Experian DataLab
Executive Vice President Global Identity, Fraud and
DataLabs; Senior Vice President Business and
Product Development North America DataLabs; and
Senior Vice President Chief Data Scientist Global
Identity, Fraud and DataLabs
Induction and training
The Company has procedures to ensure newly
appointed directors receive formal induction,
and this involves meetings with senior
executives and functional leaders. A tailored
induction programme is designed for each
new non-executive director who joins the
Board, to ensure they are equipped with the
knowledge and materials necessary to add
value. Individual induction programmes are
usually completed within the first six months
of a director’s appointment and the Company
Secretary assists and supports throughout the
induction process. The programmes are
reviewed regularly to consider directors’
feedback and are continually updated and
improved.
As well as visits to the business, the Board also
receives requisite and appropriate updates
throughout the year. This year, sessions
included:
a
An update/training session for the Audit
Committee on audit and corporate reform,
potential impacts on Experian and actions
being taken by Experian to ensure
readiness.
a
An external update to the Remuneration
Committee on trends in remuneration and
corporate governance.
We develop a comprehensive and tailored
induction programme for each newly
appointed independent non-executive director,
based on their experience, background and the
requirements of the role. The programme
consists of meetings and main operating site
visits as appropriate, designed to help the new
independent non-executive director
understand their responsibilities and help
them to make a valuable contribution to the
Board. On 1 November 2022, Kathleen DeRose
and Louise Pentland joined the Board as
independent non-executive directors. Their
induction sessions were held from November
2022 to February 2023, with follow-on ad hoc
meetings as requested. All sessions were held
with the relevant business or regional leader
(for Business/Operations updates) and
relevant functional executive for the
Corporate/Governance updates. Pre-reading/
viewing material was made available, including
Group strategy presentations.
“Spending time with key people
throughout the business and visiting
the Experian DataLab in California
during January 2023 helped me get
a greater sense of the culture within
the Group.”
Kathleen DeRose
“My induction sessions focused
on building my knowledge of
the different businesses within
Experian, which helps me to
better support and contribute
to Board discussions.”
Louise Pentland
In January 2023, the Board held its meeting in
our operational headquarters in Costa Mesa,
California. As part of their induction
programme, Kathleen and Louise travelled to
San Diego, California and visited the Experian
DataLab there, where they received
presentations and demonstrations from senior
management on Experian Ascend Technology
Platform, Signal hub and CrossCore Identity
exchange. They also met and had a working
lunch with employees and management of
the DataLab. This provided Kathleen and
Louise with an opportunity to gain a deeper
understanding of our culture and to engage
with our people within the business.
Nomination and Corporate Governance Committee report
continued
Experian plc
Governance
110
Code principle
Composition, Succession and Evaluation
Diversity
At Experian our belief is that diversity, equity
and inclusion are essential to our purpose of
creating a better tomorrow, together, by
making positive change in the world and
actively supporting efforts to close the
financial wealth gap for underserved
communities. We actively support the potential
of all expressions of diversity, including but not
limited to thought, style, sexual orientation,
gender identity/expression, race, ethnicity,
disability, culture and experience. We welcome
people of all backgrounds to bring their whole
selves to Experian.
The Board’s diversity policy is unchanged. We
strongly believe that diversity throughout the
Group and at Board level is a driver of business
success. We respect, value and welcome all
forms of diversity, and seek to reflect the
diversity of our clients, investors and
employees in our Board. We recruit talented
Board members, who have the appropriate
mix of skills, capabilities and market
knowledge to ensure the Board is effective.
When recruiting, we look across all sectors
and non-traditional talent pools, and we
require diversity on our candidate shortlists.
In line with the new requirements of the UK
Financial Conduct Authority (FCA) Listing
Rules, companies must report information and
disclose against targets regarding the
representation of women and ethnic minorities
on their boards and executive management.
It is Experian’s first year reporting under these
rules. The current female representation on
the Board is 45%, which exceeds the
requirement of the new rules. We continue to
monitor closely the numbers submitted as part
of the FTSE Women Leaders Review around
the position of our executive committee and
their direct reports. The proportion of women
in this population currently stands at 27%. As
part of our commitment to continue to improve
our gender diversity, we have put in place a
three-year target of 30% for this group. This,
alongside the targets set for senior and
mid-level leaders within Experian, will ensure
a strong pipeline of women for our most senior
positions over time. In addition, the March 2023
Parker Review Committee update regarding
ethnic diversity confirmed that we exceeded
their Board ethnic diversity recommendations.
We continue to recognise the significant
benefits of a diverse Board and, when
recruiting, will continue to seek to address any
diversity gaps on our Board, including gender
and ethnicity. In July 2022, Alison Brittain was
appointed as Senior Independent Director and
Chair of the Remuneration Committee in place
of George Rose. Both positions are regarded as
senior roles within Experian, and the Senior
Independent Director role is considered as a
senior Board position under the new FCA rules.
Throughout the year, the Board included at
least one independent non-executive director
of an ethnic minority background.
The Code specifies that the Board should
undertake a formal and rigorous annual
evaluation of its own performance and that of
its committees and individual directors, and
that the Board should also have an externally
facilitated evaluation at least once every three
years.
FY23 was Year 1 of our Board’s three-year
review cycle, and an external evaluation was
conducted by Manchester Square Partners
(MSP) (who have no other connection with the
Group or Board members) to provide the Board
with greater insights into its performance and
to identify opportunities to further increase and
improve its overall effectiveness.
MSP held meetings with the Chair and the
Company Secretary to agree the scope and
relevant topics for consideration, and reviewed
Board and committee meeting papers for the
previous 12 months. A principal from MSP then
observed the Board, Audit, Remuneration, and
Nomination and Corporate Governance
Committee meetings in November 2022, to
gain further insight into Board members’
interactions and Board and committee
performance. Board members were sent a
briefing note, including an outline of the
interview framework, ahead of individual
meetings, lasting at least one hour in each
case, with MSP in November and December
2022.
Following the above, the Chair and then the
Chair and Company Secretary met with MSP to
review and discuss the findings.
An evaluation report was prepared and
presented to the Board by MSP at the January
2023 Board meeting. The report included
details of the context of the review, summary
observations and details of each area reviewed,
which included strategy development and
review and strategic priorities, operational
challenges, perceived risks and risk
management, relations with stakeholders,
talent management, leadership development
and succession planning, the Board’s role and
dynamics, Board composition, succession and
engagement, and purpose, values and culture.
While the report noted that there were no
immediate experience gaps on the Board,
future non-executive director recruitment
would continue to focus on the wider diversity
of the Board, cultural fit, strength of voice and
seniority of experience.
The FY24 focus areas agreed by the Board,
taking account of the specific outputs of the
evaluation process, appear on the following
page, and an update of progress against the
areas of focus the Board agreed as part of the
previous year’s evaluation is also provided.
Follow-up to the key potential action points
noted in the report was discussed by the
Nomination and Corporate Governance
Committee at its March 2023 meeting.
Overall, the conclusion of the evaluation was
that Board performance is strong and is
considered among best in class but that there
is also no complacency. All directors are
ambitious for the business and keen to realise
its full potential. They recognise the challenges
faced by Experian strategically, operationally
and financially through the next stage of its
development. There is broad alignment on
what the Board needs to do, and continue to do,
to be even more effective going forward. In
addition to the formal external evaluation, the
Board evaluation
At Experian, we embrace diversity and
appreciate different perspectives and the
unique value each employee brings.
Fundamentally, we do not discriminate against
anyone based on race, colour, religion, gender,
sexual orientation, gender identity or
expression, national origin, disability, age,
covered veteran status, or any other
characteristic protected by law. We are
dedicated to providing a safe, healthy and
productive work environment for all
employees. We are committed to respecting
and promoting human rights and we do not
tolerate any infringement of these rights in our
business or our supply chain. The Group’s Code
of Conduct applies to everyone at Experian,
including contractors, suppliers and others
who do business with us. Contractors and
suppliers performing work on behalf of
Experian are expected to comply with the law
and the portions of the Group’s Code of
Conduct that apply to them.
As well as the Board policy outlined above, the
Group’s Code of Conduct further outlines our
approach and how we think about diversity.
We understand the fundamental value that
diversity, equity and inclusion bring to our
business, and there are many ongoing
initiatives to support a work environment in
which everyone is treated with fairness and
respect, has equal access to opportunities
and resources, and can contribute fully to
our success.
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Annual Report 2023
Governance
Code principle
Composition, Succession and Evaluation
directors each met the Chair to discuss their
performance and any development needs in
March 2023. The Senior Independent Director
evaluated the Chair, considering input from
other directors. A performance evaluation
discussion was included on the agendas of
principal Board committee meetings in FY23,
supported by an analysis of how each
committee was performing against the key
duties and responsibilities in its terms of
reference.
Area
Focus
Progress
Board and management
succession
A key focus area for the Nomination and Corporate Governance
Committee in FY22 was executive, and Board Senior
Independent Director (SID) and Committee Chair, succession.
During FY23, Kerry Williams will transition out of his role as
Chief Operating Officer (COO), and retire from the Board at the
Annual General Meeting in July 2022. Craig Boundy will succeed
Kerry as COO, and be appointed to the Board on Kerry’s
retirement. In addition, Alison Brittain will become SID and
Remuneration Committee Chair, and Jonathan Howell will be
appointed as Audit Committee Chair. Given the importance of
these roles, the Board and Nomination and Corporate
Governance Committee will closely oversee and monitor the
appointments and transitions, and will also provide input on
Group Operating Committee roles, including areas for
development.
There were key Board member changes during the year, as
outlined in this report. The changes regarding Committee chairs
were carefully planned and orchestrated over an extended
period, with Jonathan Howell appointed in 2021 and Alison
Brittain appointed in 2020. The non-executive director
succession process has proceeded well, and there has been
an effective transition from Deirdre Mahlan and George Rose,
to Alison Brittain and Jonathan Howell, both of whom are
considered excellent additions who have brought critical
insights and strong contributions, and stepped easily into
their roles.
The Nomination and Corporate Governance Committee
continues to regularly review and monitor executive succession.
Regulation
The Board and Audit Committee receive regular legal,
regulatory and compliance updates, including the activities of
key regulators such as the UK Financial Conduct Authority and
the US Consumer Financial Protection Bureau. These updates
are provided by the Group’s General Counsel, and the Board
and Audit Committee have noted a recent potential increase in
regulatory activity globally. Below Board level, these matters
are kept under ongoing review throughout the business. The
Board and Audit Committee will continue their close monitoring
of the position, including latest developments, impacts on the
business and progress with regulatory engagement.
In September 2022, the Audit Committee reviewed an
integrated set of plans to guide the continued development of
the business in risk, information security, and privacy, ethics
and compliance. The leaders of these functions presented their
strategic and tactical updates to the Committee, focused on
effective risk management, employee accountability, and
recognising the increased expectations of regulators and
clients, and the continued development and expansion of
Experian’s business.
In addition, and reflecting the importance of the second line
functions, new and elevated leadership was put in place.
Area
Focus
Ongoing education of non-executive
directors (NEDs)
The Board recognises the high quality and the varied level of experience of the Board NEDs, and has kept under review
the best approach to ongoing education, with a view to prioritising topics around the risks and opportunities from
emerging regulatory themes and how the Board could influence these. It is intended to build on the current NED
education and opportunities for further exposure to the business, through increased exposure to subject-matter experts
and invitations to client conferences and other role-specific meetings.
Talent mapping
The Nomination and Corporate Governance Committee will increase its understanding and oversight of the succession
planning that is undertaken below the level of the Group Operating Committee. This will include identification of
strengths, development needs and future potential of identified successors through the development of a talent map
that will be presented to the Committee.
Progress against the focus areas highlighted in the FY22 review
FY24 focus areas agreed following the FY23 review
Evaluation by external
facilitator
Internal review against
detailed Year 1 review
Questionnaire-based internal
evaluation
Year 1 – FY23
Year 2 – FY24
Year 3 – FY25
Nomination and Corporate Governance Committee report
continued
Experian plc
Governance
112
Code principle
Composition, Succession and Evaluation
Audit Committee report
Jonathan Howell
Chair of the Audit Committee
This Committee continues to fulfil
a vital role in the Company’s
governance framework, providing
independent challenge and oversight
across the Company’s financial
reporting, risk management and
internal controls and cyber security.
Members
Jonathan Howell (Chair)
Alison Brittain
Kathleen DeRose
Caroline Donahue
Luiz Fleury
Esther Lee
Louise Pentland
Composition and experience
a
All members of the Committee are
independent non-executive directors
and have been appointed to the
Committee based on their individual
financial and/or commercial experience.
The Board considers that all members
of the Committee meet the requirements
for Committee membership, through
their deep levels of experience.
a
Jonathan Howell has chaired the
Committee since 1 July 2022, and is a
qualified accountant with recent and
relevant financial experience through
his role as Chief Financial Officer of The
Sage Group plc. He has previously held
other senior finance roles, including as
an independent non-executive director
and Chair of the Audit and Risk
Committee of The Sage Group plc.,
Group Finance Director of Close
Brothers Group plc and Group Finance
Director at London Stock Exchange
Group plc.
a
The UK Corporate Governance Code
requires that at least one member of the
Committee has recent and relevant
financial experience, and the Disclosure
Guidance and Transparency Rules
(DTRs) require that at least one member
has competence in accounting and/or
auditing. The Board is satisfied that
these requirements are met through
Jonathan Howell’s membership of the
Committee.
a
The Committee met four times during
the year, with each scheduled meeting
timed to coincide with key dates in the
Group’s financial reporting and audit
cycle.
a
Regular attendees at meetings include
the Chair, the executive directors, the
Group General Counsel, the Head of
Global Internal Audit, the Global
Financial Controller, the Global Chief
Information Security Officer, the Group
President, Global Technology, the Group
Chief Risk Officer and representatives
from KPMG LLP (the external auditor).
Other invitees include the Director of
Corporate Finance and the Group Head
of Tax.
a
The Committee is authorised to seek
outside legal or other independent
professional advice as it sees fit.
a
The Committee was in place throughout
the year ended 31 March 2023.
Committee's key role and
responsibilities
The responsibilities of the Committee are
defined in the Committee’s terms of reference,
which were most recently reviewed and
approved by the Committee and the Board in
September 2022. The Committee operates in
accordance with the FRC’s UK Corporate
Governance Code and Guidance on Audit
Committees.
The Board believes the Audit Committee to be
a central pillar for effective corporate
governance by providing independent and
impartial oversight of the Company’s relevant
functions. As a committee, our responsibilities
include:
a
Monitoring the integrity of the financial
statements and reviewing significant
financial reporting judgments contained
in them.
a
Reviewing internal financial controls and the
Group’s internal control and risk
management systems.
a
Reviewing the effectiveness and quality of
the audit process and the independence and
objectivity of the external auditor.
a
Monitoring and reviewing the effectiveness
of the internal audit function.
a
Developing and implementing policy on
engaging the external auditor to supply
non-audit services, taking into account
relevant guidance.
a
Approving the external auditor’s
remuneration and terms of engagement and
making recommendations about its
re-appointment.
a
Monitoring and reviewing risk management,
information security, and privacy, ethics and
compliance, matters.
Evaluation of the performance
of the Committee
The Committee’s performance was reviewed
as part of the 2023 external Board evaluation
process. Following consideration of the
findings, the Board was satisfied that the
Committee was operating effectively.
In addition, at the September 2022 meeting,
the Committee reviewed its activities during
the year against its terms of reference. The
Committee also discussed its performance
and concluded that it was operating effectively.
Having been appointed as Chair of the
Committee in July 2022, I am pleased to
present my first report to shareholders on how
the Committee carried out its responsibilities
during the year. It was a busy year for the
Committee, which remains an essential part
of Experian’s overall governance framework.
The Board has delegated to the Committee
the responsibility to oversee and assess the
integrity of the Group’s financial reporting, risk
management and internal control procedures,
review of cyber security matters and the work
of both the internal audit function and the
external auditor, KPMG LLP.
Included in this report are: specific areas of
focus for the Committee during the year
(including consideration of key elements of the
proposed UK audit and corporate governance
reforms); and strategic updates on our second
line of defence functions (Group Risk
Management, Information Security, and
Privacy, Ethics and Compliance). The report
also provides details of the significant
accounting and reporting matters the
Committee considered in relation to the
financial statements and how these were
addressed, and how the Committee concluded
that the 2023 Annual Report was fair, balanced
and understandable.
Link to the Committee
terms of reference
https://www.experianplc.com/
about-us/corporate-
governance/board-committees/
113
Experian plc
Annual Report 2023
Governance
Code principle
Audit, Risk and Internal Control
Audit Committee report
continued
a
Reviewed significant accounting and
reporting matters updates from the Chief
Financial Officer and Global Financial
Controller at each meeting.
a
Reviewed a Cyber Security update from the
Global Chief Information Security Officer at
each scheduled meeting. This is a standing
item on the Committee agenda, given its
importance to the Group.
a
Reviewed full or summary risk management
updates at each meeting, including status of
risk and litigation management.
a
An Internal Audit update was presented by
the Head of Global Internal Audit at each
meeting, and discussed by the Committee.
This includes the status of the audit plan,
audit findings and themes in the reporting
period, and progress on any overdue audit
actions.
Committee activities – all meetings
Activities during the year
The Committee carries out a range of significant activities during the year. Some standing items are covered at every meeting, such as updates on
Internal Audit, Cyber Security and Risk Management, while other key items are covered at specific meetings depending on the cadence of activities
during the year. This includes review of the half-year and preliminary results announcements, review of the Annual Report and assessment of internal
and external audit.
The tables below set out these activities, and the associated timings, in more detail.
September 2022
November 2022
March 2023
May 2023
a
Reviewed and approved second
line of defence strategic updates
(see next page).
a
Reviewed the FY23 external audit
plan with the external auditor,
including the engagement letter.
a
Reviewed and discussed the
evaluation of the external auditor
(see page 118 ‘External auditor’).
a
Reviewed the external evaluation
from PwC on the performance of
the Global Internal Audit function
(see page 117 ‘Internal audit’).
a
Reviewed a Confidential Helpline
and Whistleblowing update.
a
Reviewed an update on fraud
identification and management.
a
Reviewed and approved the
Group’s Treasury Policy and Tax
and Treasury Committee terms of
reference.
a
Approved the Committee’s annual
meeting schedule and reviewed
the Committee’s performance
against its terms of reference.
a
Reviewed the half-yearly financial
report announcement, and papers
in relation to:
–
half-year accounting matters
–
the preparation of the
half-yearly report on the going
concern basis
–
a fair, balanced and
understandable assessment
–
the making of management
representations.
a
Reviewed the external auditor’s
half-year report, including
independence considerations.
a
Received Audit and Corporate
Reform training from the Global
Financial Controller.
a
Reviewed non-audit fees.
a
Reviewed the principal accounting
policies, pre-year-end accounting
matters and updates on the
year-end financial statements and
financial review.
a
Reviewed the external auditor’s
pre-year-end report, including
scope, status and controls
findings.
a
Reviewed the Global Internal Audit
strategy and annual plan.
a
Reviewed the Group’s non-audit
fee policy.
a
Reviewed the Group audit fee.
a
Reviewed the Group’s Tax Policy.
a
Reviewed a Confidential Helpline
and Whistleblowing update.
a
Reviewed an update on fraud
identification and management.
a
Considered the re-appointment of
the external auditor.
a
Reviewed risk, information
security and compliance strategic
updates.
a
Reviewed and approved second
line of defence terms of reference.
a
Reviewed the preliminary results
announcement and the Annual
Report, and papers in relation to:
–
year-end accounting matters
–
the preparation of the financial
statements on the going
concern basis (see also note 2 to
the Group financial statements)
–
the making of a viability
statement recommendation
to the Board
–
the fair, balanced and
understandable assessment
–
the making of management
representations.
a
Reviewed the 2023 Annual Report
to ensure it was fair, balanced and
understandable and provided
information enabling an
assessment of Experian’s position
and performance, business model
and strategy.
a
Reviewed the Risk Management
framework and Summary of
Assurance.
a
Approved the required Statement
on Internal Controls and Risk
Management.
a
Reviewed the external auditor’s
year-end report, including
independence considerations.
Committee activities – specific meetings
Experian plc
Governance
114
Code principle
Audit, Risk and Internal Control
a
At its September 2022 meeting, the
Committee received and discussed
important second line of defence updates
from the senior management leaders of
Group Risk Management, Cyber Security,
and Privacy, Ethics and Compliance.
a
A wide range of measures has been
implemented in recent years to strengthen
Experian’s approach to principal risks, and
there is new leadership in place across the
three functions.
a
The next phase in the strategic approach
was to harmonise the overall approach,
including management of the most material
risks.
a
The intention was to bring a consistent
approach, strategic goal, taxonomy, and
cadence of reporting across the Group’s risk
management programme.
a
As part of the update, the Committee
reviewed and discussed key strategic
updates for each of the three second line of
defence functions.
a
The Committee also considered and
approved updated terms of reference for
each second line of defence function.
September 2022 – second line of defence strategic updates
Significant accounting and reporting matters
At each meeting, the Committee receives a formal financial update from the Chief Financial Officer and/or the Global Financial Controller informing the
Committee of developments in the Group’s reporting and accounting environment, and compliance with relevant reporting standards. During the year, the
Committee assessed the overall quality of financial reporting through review and discussion of the significant accounting matters and the half-year and
annual financial statements.
The Committee’s review included assessing the appropriateness of the Group’s accounting policies and practices, confirming their compliance with
financial reporting standards and relevant statutory requirements, and reviewing the adequacy of disclosures in the financial statements. In performing
its review of the Group’s financial reporting, the Committee considered and challenged the work, judgments, and conclusions of management. The
external auditor also provided the Committee with reports setting out its findings and conclusions on the accounting treatments included in the financial
statements, which the external auditor is able to discuss privately, without the presence of management, with the Committee.
The table below summarises the significant accounting and reporting matters considered by the Committee in relation to the Group’s financial statements
and the way they were challenged by the Committee and concluded upon. These matters, together with any other significant considerations of the
Committee, are reported to the Board. The minutes of each Audit Committee meeting are also circulated to all members of the Board.
Significant matter
Response and challenge
Cross reference
Impairment review – goodwill and other
intangible assets
Given the size of the Group’s goodwill and
other intangible assets, the recoverability of
these assets is a significant area of focus for
the Committee.
Higher interest rates and macroeconomic
weakness in our European markets have
reduced the value-in-use of the Group’s EMEA
cash generating unit (CGU), with an
impairment of US$179m recorded in the year.
The value-in-use of all other CGUs continued
to sufficiently exceed their carrying amounts.
A summary of the annual impairment analysis and underlying process was provided to the
Committee.
The Committee considered the level at which goodwill is tested and whether this was
impacted by the Group’s restructuring activity in EMEA and Asia Pacific. The Committee
concluded a consistent approach to the prior year was appropriate.
The Committee scrutinised the methodology, inputs, and assumptions applied by
management, in particular ensuring that changes in the macroeconomic environment were
appropriately captured. This included acknowledging the use of external sources to support
and corroborate management’s inputs.
The external auditor, KPMG, provided an update to the Committee on the procedures
performed over the Group’s impairment analysis, alongside their findings and conclusions on
the reasonableness of the key inputs into the analysis. These were discussed with KPMG at
the relevant Committee meeting.
The Committee further enquired as to whether any other reasonable changes in assumptions
would result in a materially different impairment charge in EMEA or generate an impairment
in Asia Pacific. The Committee agreed with management’s proposed sensitivity disclosures
for EMEA and Asia Pacific.
See note 21
to the Group
financial
statements.
Litigation and contingent liabilities
The operating activities of the Group are
subject to regulation across a high number
of geographical markets.
The volume and size of outstanding claims the
Group is subject to mean that the judgments
applied when assessing the likelihood of a
liability crystalising can have a significant
impact.
The Committee received an update and
analysis of open litigation and regulatory
matters affecting the Group, including the
enforcement notice from the UK Information
Commissioner’s Office.
The Committee has challenged management on the key judgments and assumptions made
in assessing whether a provision or contingent liability disclosure is required.
The Committee met with the Group’s legal counsel, received regular litigation updates,
and considered external advice in order to facilitate this process, alongside the feedback
provided from KPMG on the conclusion of their relevant audit procedures.
The Committee concluded that these matters had been appropriately provided for at
31 March 2023.
The Committee considered and concurred with the proposed contingent liability disclosures
included in the notes to the Group financial statements.
See note 46
to the Group
financial
statements.
115
Experian plc
Annual Report 2023
Governance
Code principle
Audit, Risk and Internal Control
Significant matter
Response and challenge
Cross reference
Tax
The Group is subject to tax in numerous
jurisdictions. The Group has a number of open
tax returns with various tax authorities with
whom it is in active dialogue.
The key uncertainties in the year related to
the deductibility of purchased goodwill,
inter-company trading and financing.
US$102m (2022: US$293m) is included in
current tax liabilities in relation to these
judgmental areas.
The Committee received a regular update from management on the adequacy of provisions in
respect of significant open tax matters. The review included details of ongoing
correspondence with tax authorities in the UK, the USA and Brazil and the principal areas of
tax challenge.
The Committee considered the evidence available to management in respect of these open
matters and challenged the judgments adopted by management.
KPMG briefed the Committee on the output of their audit procedures over uncertain tax
liabilities, and their conclusion on the provisions made by management.
The Committee concurred with management’s assessment of open tax matters, noting the
significant decline during the year following the agreement of some historical tax positions.
See note 17
to the Group
financial
statements.
Going concern and viability assessments
Given the level of management judgment
required in forming conclusions with regard
to the going concern and viability
assessments, these are key areas of focus for
the Committee.
The Committee challenged and reviewed management’s process for assessing the Group’s
longer-term viability, the appropriateness of the viability scenarios identified, and the
reasonableness of key assumptions used by management in calculating the financial impact
of a viability scenario arising over the forecast period.
The Committee reviewed the results of management’s scenario-specific stress testing for
both going concern and viability, as well as reverse stress testing, which demonstrated the
resilience of the Group.
As part of its review and challenge, the Committee took into consideration updates provided
by KPMG on its procedures and conclusions on the viability of the Group.
The Committee considered and concurred with management’s assessment and recommended
to the Board the preparation of the financial statements on the going concern basis.
See page 86
for the Group’s
going concern
and viability
statements.
Audit Committee report
continued
Fair, balanced and understandable – what do we do?
Each year, in line with the UK Corporate Governance Code and the Committee’s terms of reference, the Committee is asked to consider, and recommend
to the Board, whether or not the Annual Report is fair, balanced and understandable (FBU) and whether or not it provides the information necessary for
shareholders to assess the Group’s position and performance, business model and strategy. There is an established process to support the Audit
Committee in making this assessment, and we follow broadly the same process for the Group’s half-yearly financial report.
The main elements of the process are:
a
A list of ‘key areas to focus on’ was
previously shared with the Annual Report
team. The team is reminded of the
requirement annually and asked to reflect
this in their drafting.
a
An internal FBU committee considered the
Annual Report in May 2023, ahead of the
Audit Committee meeting. A wide range
of functions are represented on this
committee, including executives from
finance, communications, investor relations,
legal and corporate secretariat. The external
auditor also supports the committee.
a
In advance of its May 2023 meeting, the
Audit Committee received a near-final draft
of the Annual Report, together with a
reminder of the areas to focus on. The FBU
committee’s observations and conclusions
were also relayed to the Audit Committee.
a
The Annual Report is consistent with
messages already communicated to
investors, analysts and other stakeholders.
a
The Annual Report, taken as a whole, is fair,
balanced and understandable.
a
The Chair and Chief Executive Officer’s
statements include a balanced view of
the Group’s performance and prospects,
and of the industry and market as a whole.
a
Any summaries or highlights capture the
big picture of the Group appropriately.
a
Case studies or examples are of strategic
importance and do not over-emphasise
immaterial matters.
a
Following its review this year, the Audit
Committee concluded that it was
appropriate to confirm to the Board that
the 2023 Annual Report was fair, balanced
and understandable, and provided the
information necessary for shareholders
to assess the Group’s position and
performance, business model and
strategy. The FBU statement appears
in the Directors’ report.
The 'key areas to focus on' included
ensuring that:
a
The overall message of the narrative
reporting is consistent with the primary
financial statements.
a
The overall message of the narrative
reporting is appropriate, in the context
of the industry and the wider economic
environment.
Experian plc
Governance
116
Code principle
Audit, Risk and Internal Control
Specific areas of focus
The Committee spent time on the following
specific areas during the year to consider and
challenge relevant, current and important
issues:
a
At each Committee meeting, consideration
was given to the Group’s operations, risks
and controls. Specifically, this included
consideration of the impact of the
macroeconomic environment upon the
Group’s wider Enterprise Risk Management
Framework, emerging risks, business
continuity planning strategy and significant
reporting and accounting matters.
a
The Committee received a detailed update in
November 2022 from the Global Financial
Controller, with input from KPMG, on the key
elements of the UK Department for
Business, Energy and Industrial Strategy
(BEIS) consultation on the proposed audit
and corporate governance reform. The
Committee was presented with the potential
implications for the Group’s internal control
and risk management systems and related
external disclosures.
Whistleblowing and fraud
management
Experian offers employees a Confidential
Helpline to capture all complaints and
whistleblowing allegations. During the year, the
Committee agreed to maintain this service as
the primary method for staff to raise queries
that they do not feel comfortable raising with
their manager. The Confidential Helpline was
already publicised on the intranet and in the
Global Code of Conduct. During the year,
communication was extended to include
references to the Confidential Helpline in other
key policies, such as Anti-Bribery and
Corruption and Gifts and Hospitality to further
increase awareness of the availability of event
reporting. Processes with Human Resources
were formalised to ensure that any significant
issues that they are made aware of, and are
reported by any line manager, are escalated to
Internal Audit for inclusion in their reporting to
the Committee. At the September 2022 and
March 2023 meetings, the Committee received
an update including any matters relating to an
allegation or potential instance of fraud.
Information security
At each Committee meeting a Cyber Security
update was reviewed. This report provides a
summary of the key information security risks
and threats that the Group faces and an update
on the cyber security capabilities and
engagement across the Group.
The Group’s cyber security strategy and
capability is measured against a globally
recognised standard – the US National Institute
of Standards & Technology (NIST) framework.
This provides an understanding of cyber
security risks and development of customised
measures to assess and manage risks. As
noted above, the cyber security strategy for
the Group was approved by the Committee in
September 2022, focused on capability,
engagement with business units/the first line
of defence and further evolving the information
security maturity of the business. The overall
intention is to drive capability versus the risk
facing the Group, through a threat-informed
approach.
Internal audit
The role of Internal Audit is to provide
independent, objective assurance and
consulting activity to the Committee and
management. Internal Audit brings a
systematic, disciplined approach to evaluate
and improve the effectiveness of risk
management, controls, and governance
processes. The audit team is independent from
the business and reports to the Head of Global
Internal Audit who, in turn, reports functionally
to the Audit Committee and administratively to
the Chief Financial Officer. The Committee/
Committee Chair approves the appointment,
remuneration, and removal of the Head of
Global Internal Audit. The Head of Global
Internal Audit has the right of direct access to
the Audit Committee and the Chair of the
Board, and the audit team have no direct
operational responsibility or authority over any
of the activities they review. At the end of each
scheduled meeting, the Head of Global Internal
Audit meets with the Committee to discuss any
relevant matters without management being
present.
At each meeting, the Head of Global Internal
Audit presents an update to the Committee.
This includes the progress against the audit
plan, and a report on the audit findings and
themes. In addition, at the meeting in March
2023, the Committee reviewed and approved
the Global Internal Audit Strategy and Plan for
the year.
Each September, Internal Audit updates the
Audit Committee on key elements of the
advisory support provided to the business over
the previous 12 months, in addition to its
regular audit reporting work. Internal Audit
assisted in many areas and below is a sample
of these.
Internal Audit:
a
continued to work with the other governance
functions in the development of the Group’s
risk framework model
a
provided thematic analysis and support to
the sub-groups involved in a mergers and
acquisitions project to improve due diligence
and integration processes globally
a
provided advisory feedback and guidance as
part of Technology Lifecycle Management
and Configuration Management process/
technology updates
a
was engaged and involved in a Global Cloud
Technology strategy forum to provide risk
monitoring and advisory feedback.
The specific objectives, authority, scope, and
responsibilities of the Internal Audit team are
set out in more detail in the Experian Internal
Audit terms of reference, which are reviewed
annually by the Committee. The Committee
also considers and evaluates the level of
Internal Audit resource and its quality,
experience and expertise, supplemented as
appropriate by third-party support and subject
matter expertise, to ensure it is appropriate to
provide the required level of assurance.
In line with the Chartered Institute of Internal
Auditors’ (IIA) Code of Practice, the
effectiveness of Internal Audit is reviewed by
the Committee on an annual basis and is also
subject to an external quality assessment
(EQA). There is a four-year evaluation cycle for
Experian’s Internal Audit function, the structure
of which is a full external quality assessment
every four years, and follow-up interim
external quality assessments and internal
reviews in the intervening period.
A full EQA took place during the year,
undertaken by PwC. The process included:
a
interviews with stakeholders (including
non-executive directors, executive directors
and senior management across Experian
including the Chair of the Audit Committee
and the Chief Executive Officer)
a
workshops held with the Internal Audit team
members
a
review of a survey sent to all members of
the Internal Audit team
a
a Digital Fitness Assurance Assessment
carried out as a self-assessment with the
Global Head of IT Audit
a
a review of Internal Audit’s structure and
remit, audit approach and human resource
capability
a
a review of internal audit files from the
previous 12 months across the areas of
planning, working paper documentation,
review and reporting.
117
Experian plc
Annual Report 2023
Governance
Code principle
Audit, Risk and Internal Control
Audit Committee report
continued
PwC compared the outputs with their peer
group organisations, their EQA database and
their knowledge of good Internal Audit practice,
as well as the IIA Standards.
In September 2022, the Committee reviewed
the conclusions of the evaluation. The report
highlighted that Internal Audit is built upon
strong foundations: there is a solid
methodology and approach underpinned by
the growing use of technology, quality work,
focused goal-setting and performance
management, and an experienced and
competent team. The report concluded that
Experian Global Internal Audit benchmarks
well against peer groups, and complied with
the IIA Standards for Internal Audit. There were
a number of non-urgent recommendations
and actions highlighted. The Head of Global
Internal Audit has reported back to the
Committee on these matters, and
implemented changes where appropriate.
External auditor
Tenure and tendering
KPMG LLP (KPMG) is the Group’s current
external auditor, and has been since July 2016,
following the conclusion of an audit tender
process in September 2015. There are
currently no contractual obligations restricting
our choice of external auditor and we confirm
that we have complied with the provisions of
the UK Competition and Markets Authority
(Mandatory Use of Competitive Tender
Processes and Audit Committee
responsibilities) Order 2014 for the financial
year under review.
Each year, the Committee makes a
recommendation to the Board whether the
external auditor should be reappointed. Before
making that recommendation, the Committee
considers the auditor’s effectiveness, including
its independence, objectivity and scepticism.
Effectiveness, audit quality,
independence and appointment
At its September 2022 meeting, the Audit
Committee reviewed and discussed KPMG’s
audit strategy for the year ended 31 March
2023. In March 2023, the Committee received
detailed updates on the audit’s progress, which
included details of the external auditor’s
actions, such as the audit procedures
undertaken, the audit’s coverage, and the
status of any significant findings, as well as
details of key matters arising from the audit
and assessments of management’s judgments
on them. At the end of each scheduled
meeting, KPMG meets with the Committee to
discuss any relevant matters without
management being present. The Committee
reviewed the content of the independence
letter and the management representation
letter, as well as engagement terms.
The terms of reference of the Audit Committee
include a requirement to assess annually
the effectiveness of the external auditor.
This is in line with the FRC’s Guidance on
Audit Committees (April 2016). Internal Audit
supports the Audit Committee by gathering
information to complete this review and issued
questionnaires to the Board members and
certain senior management, as well as a more
detailed set of questions to senior finance
leadership.
The evaluation focused on the four key areas
used in the FRC’s December 2019 ‘Practice aid
for audit committees’: mindset and culture;
skills, character and knowledge; quality
control; and judgment. The Committee also
reflected on the assurance on financial
statements, the audit teams and
communication, as well as considering
external regulatory updates on the external
auditor received during the year.
The overall results of the evaluation were
positive. In general, KPMG was felt to be
effective and collaborative throughout the
audit process. It provided robust challenge,
demonstrated sound judgment and
communications were clear. Overall, KPMG
had provided an effective and robust audit.
Suggestions for improvements were made,
which have been discussed with KPMG – these
included allowing the Chair of the Audit
Committee to meet more of the KPMG team
and having it provide appropriate updates on
new accounting or regulatory matters.
The Committee also evaluates the quality of
the audit (along with the effectiveness review
described above) in the following ways:
Meeting attendance by the external auditor
– KPMG attends all scheduled Committee
meetings and, during the year, reported to the
Committee on the components of the audit
plan, additional or forthcoming requirements
or regulatory changes, audit findings and
half-year review findings.
Audit Quality Inspection and Supervision Report
(AQR)
– In July 2022, the FRC published its AQR
for KPMG, which set out the FRC’s findings on
key matters relevant to audit quality and is
primarily based on a sample of individual
audits (mainly public interest entities – PIEs)
and their assessment of elements of the firm’s
systems of quality control. The inspection
results for KPMG had improved since last year,
although some findings were identified for
KPMG in relation to banking entities.
Independence
To ensure auditor objectivity and
independence, the Committee reviews
potential threats to independence and the
associated safeguards during the year. The
safeguards that KPMG had in place during
the year to maintain independence included
annual confirmation by KPMG staff of
compliance with ethics and independence
policies and procedures. KPMG also had in
place underlying safeguards to maintain
independence by: instilling professional values;
communications; international accountability;
and independent reviews. There was also
appropriate pre-approval for non-audit
services, which are provided only if
permissible under relevant ethical standards.
Details of this policy are laid out on page 119.
During the year, KPMG reported to the
Committee that certain member firms had
provided non-permitted services (which have
now been terminated) to a small number of
Experian subsidiaries (further information is
provided in the KPMG audit report). The entities
concerned are not in scope for the Group audit,
the work was administrative in nature, and
was conducted after the Group audit opinion
was signed by KPMG for each of the impacted
financial years. Based on the Committee’s
assessment of the matter, KPMG’s integrity,
objectivity, and independence has not been
compromised in any way.
Following the year-end audit, neither Experian
nor any of its subsidiary companies will
employ any audit partner or audit team
member in a position which could have a
significant influence on the Group’s accounting
policies or the content of its financial
statements until a cooling-off period has
elapsed. The cooling-off period is two years in
respect of an audit partner, and one year in
respect of a director, where they have worked
on the audit of Experian plc or its subsidiaries.
The Committee will receive an update if any
audit team members are recruited into senior
positions by Experian, followed thereafter by
annual reporting on numbers of former auditor
senior employees, should any remain.
The Committee also considered the
independence of the external auditor’s
partners and staff involved in the audit
process. KPMG has confirmed that all its
partners and staff complied with its ethics and
independence policies and procedures that are
consistent with the FRC’s ethical standards,
including that none of its employees working
on the Experian audit holds publicly listed
securities issued by Experian. In addition, the
Experian plc
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Committee acknowledges management’s
internal assessment that no employee in a key
financial reporting oversight role has a close
relationship with any KPMG employee which
may impact their independence.
The Committee concluded that the external
auditor had maintained its objectivity and
independence throughout the year.
Non-audit services
KPMG provides certain other services to
Experian. To ensure auditor objectivity and
independence, we have a policy relating to
providing such services. The policy includes
financial limits above which any proposed
non-audit services must be pre-approved,
depending on the expenditure proposed.
The Committee receives half-yearly reports
providing details of non-audit assignments
carried out by the external auditor, together
with the related fees. Under the policy,
non-audit fees paid to KPMG are capped at
30% of the fees for audit services, except in
exceptional circumstances. Pre-approval by
the Audit Committee or Audit Committee Chair
is required in that situation. An analysis of fees
paid to the external auditor for the year ended
31 March 2023 is set out in note 14 to the
Group financial statements.
Auditor re-appointment
Having considered the effectiveness and
independence of KPMG as summarised above,
the Committee recommended to the Board
that a resolution to re-appoint KPMG be
proposed at the 2023 AGM, which the Board
reviewed and approved.
Provision of non-audit services
Background
The Audit Committee annually reviews the
policy on the provision of non-audit services
and recruitment of former auditor employees,
and the latest review took place in March 2023.
The Committee considered the application of
the policy, and confirmed it was properly and
consistently applied during the year. The policy,
a summary of which is set out below,
recognises the importance of the external
auditor’s independence and objectivity.
Policy
The external auditor is prohibited from
providing any services other than those
directly associated with the audit or required
by legislation and/or permitted by FRC ethical
guidance. These limited services are detailed
in the non-audit services policy, which is
reviewed and approved by the Committee on
an annual basis.
The appointment of the external auditor for any
non-audit work up to US$50,000 must be
approved by the Global Financial Controller.
The appointment of the external auditor for any
non-audit work where the expected fees are
over US$50,000 and up to US$100,000 requires
the approval, in advance, of the Group Chief
Financial Officer. Where the expected fees are
over US$100,000, the approval of the Chair of
the Audit Committee is required in advance.
Where cumulative annual fees exceed the 30%
annual limit, all expenditure must be approved
by the Audit Committee. All expenditure is
subject to a tender process, unless express
permission is provided by the Chair of the Audit
Committee, the Chief Financial Officer or the
Global Financial Controller based on the above
approval limits. Any expenditure below
US$100,000 not subject to a tender will be
notified to the Chair of the Audit Committee
annually.
Commercial agreements where Experian
provides services to the auditor must be
approved by the Global Financial Controller
and not exceed the lower of 5% of the local
Experian entity’s total revenue and
US$250,000, and all transactions should be
undertaken on an arm’s length basis.
Transactions in excess of this limit require
approval of the Chair of the Audit Committee
in advance.
The Committee receives half-yearly reports
providing details of assignments and related
fees carried out by the external auditor in
addition to their normal work.
Risk management and internal control
The Board is responsible for maintaining and
reviewing the effectiveness of our risk
management activities from a strategic,
financial, regulatory, and operational
perspective. These activities are designed to
identify and manage, rather than eliminate, the
risk of failure to achieve business objectives or
to successfully deliver our business strategy.
In line with the Code, on behalf of the Board,
the Audit Committee monitors our risk
management and internal control systems,
robustly assesses the principal risks identified
by our risk management processes (including
those that would threaten our business model,
future performance, solvency or liquidity), and
monitors actions taken to mitigate them.
During the year, and as outlined earlier, the
Committee received second line of defence
strategic updates at its September 2022
meeting, comprising details of the plans for
Group Risk, Cyber Security, and Privacy, Ethics
and Compliance. The Committee also noted the
new second line of defence leadership
structure, including the appointment of a new
Group Chief Risk Officer (CRO), Global Chief
Privacy, Ethics and Regulatory Compliance
Officer and a new Group Chief Information
Security Officer (CISO). As well as the strategic
updates, the Committee was briefed on tactical
measures already underway, on a
threat-informed basis, to manage and mitigate
near-term reductions in areas of risk critical to
the defence of the Experian business. These
measures are focused on complex areas
where a need to rapidly evolve the process,
controls and operational assurance of
implementation has been identified. Our risk
management processes are designed to
identify, assess, respond to, report on and
monitor the risks that threaten our ability to
achieve our business strategy and objectives,
within our risk appetite.
There is an ongoing process for identifying,
evaluating, and managing the principal and
emerging risks we face. This process was in
place for the financial year and up to the date
of approval of this Annual Report. Full details
of our risk management and internal control
systems and processes can be found in the
Risk management and principal risks section
of the Strategic report on page 78. The Audit
Committee considers emerging risks with
management as part of the standing risk
management update it receives.
Effectiveness of the risk management
and internal control systems
Experian’s risk management programme
is regularly reviewed, and we engaged
an external firm previously to assess the
current state and identify opportunities for
improvement. The scope was focused
generally on risk management organisational
structure and management, with a particular
emphasis on operational risk management.
The output of the external review work
was used to adjust the Enterprise Risk
Management (ERM) programme and set
goals for the next one to three years.
The implementation plan, reviewed by the
Audit Committee, contained a number of
recommendations on operational risk which
we continue to implement (further detail is
available in the Risk section).
In line with the Code, the Audit Committee
(on behalf of the Board) monitors our risk
management and internal control systems,
robustly assesses the principal risks identified
by our risk assessment processes (including
those that would threaten our business model,
future performance, solvency or liquidity),
and monitors actions taken to mitigate them.
For certain joint arrangements, the Committee
relies on the systems of internal control
119
Experian plc
Annual Report 2023
Governance
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Audit, Risk and Internal Control
Audit Committee report
continued
operating within Experian partners’
infrastructure and the obligations of partners’
boards, relating to the effectiveness of their
own systems.
The Code requires companies to review the
effectiveness of their risk management and
internal control systems, at least annually.
The Audit Committee performs this review
under delegated authority from the Board.
Through a combination of ongoing and annual
reviews, the Committee is able to review the
effectiveness of the Group’s risk management
and internal control system.
The annual review of effectiveness considered
that:
a
there was a process in place to determine
the nature and extent of the principal risks
the Company was willing to take in order to
achieve its long-term strategic objectives
a
there was an ongoing process for
identifying, evaluating, and managing the
emerging and principal risks faced by the
Group that was regularly reviewed by the
Committee
a
processes were in place throughout the year
ended 31 March 2023, and which would
remain in place up to the date of approval of
the Annual Report
a
the effectiveness of such processes was
reviewed by the Board
a
the information the Board received was
sufficient to enable it to review the
effectiveness of the Group’s risk
management and internal control systems.
Following this year’s review, the Committee, on
behalf of the Board, considers that the
information it received enabled it to review the
effectiveness of the Group’s system of internal
control and risk management in accordance
with the FRC’s ‘Guidance on Risk Management,
Internal Control and Related Financial and
Business Reporting’ and that there were, and
the system has, no significant failings or
weaknesses.
For more on our approach to risk management
see pages 78 to 85.
Experian plc
Governance
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Stakeholder experience in FY23
Employees
a
Global employment increased by 1,400 to 22,000
a
No forced annual leave or reduced working hours
a
Normal bonus entitlement for FY22 and FY23
a
Flexible working practices
a
3% global pay increase budget for FY24
a
Dividends of USc35.75 and USc17.0 per share paid in July 2022
and February 2023 respectively
a
Proactive shareholder consultation
a
No shareholder capital raising
a
FY23 pay increases lower than employees
a
Strategic investments and acquisitions to support future growth
a
High single-digit Benchmark EBIT and revenue growth
Investors
Executives
Experian
Group
a
Additional investment in financial wellbeing support
a
No adjustments to in-flight Long-Term Incentive (LTI) awards
a
Pension provision alignment with the wider workforce
Our ambition to grow remains at the forefront
of our business strategy and is an integral part
of our culture. Our culture and investment in
innovation and growth creates a mindset –
arguably even more valuable in challenging
operating circumstances – that has driven our
track record of strong financial performance
and fuels both our short- and longer-term
growth ambitions.
Protecting our people
We have an overarching ‘people first’ philosophy
and protecting our employees is a key focus for
us. The majority of our workforce continues to
work from home as hybrid and remote working
have become established business practices.
In FY23, we further developed the policies and
practices that were established following the
onset of the COVID-19 pandemic.
Our track record of providing support for those
employees who need it most has come to the
fore again during this latest financial year. The
most recent example being a one-off allowance
for our lowest paid UK employees to help with
the impact of rising inflation. In addition, we took
the opportunity to remind all our employees
about the resources and support that are
available to them as part of our financial
wellbeing offer. This includes support across
a whole range of topics including financial
planning, mortgage advice, loan and debt
management, helpful guides, tax planning and
financial protection as well as highlighting our
employee benefits.
Report on directors’ remuneration
Alison Brittain
Chair of the Remuneration Committee
I am pleased to present, on behalf of
the Remuneration Committee, the
Report on directors’ remuneration,
following a strong year for the
Group.
Members
Alison Brittain (Chair)
Kathleen DeRose
Caroline Donahue
Luiz Fleury
Jonathan Howell
Esther Lee
Louise Pentland
Mike Rogers
Introduction
I am pleased to report that FY23 was
another strong year for our business.
High single-digit revenue and Benchmark
EBIT growth is a notable achievement. This
level of performance in the face of external
operating environment challenges was a
reflection of the sustainability of the
business, the quality of our leadership team
and the dedication and performance focus
of our people.
We continue to reap the rewards of a number
of key decisions that have been made in
recent times. When uncertainty arrived in
the form of the COVID-19 pandemic, we
chose to maintain our key strategic
investments, including increasing our focus
in key areas such as our Consumer Services
business. Importantly, we also put measures
in place to support all our employees
working from home, including introducing
a number of 'people first' policies to enable
employees to balance their work and
personal life. As the working world
transitioned to a hybrid model, we were in
the fortunate position of already having the
policies, processes and overall support to
be very effective in the new ways of working.
As we have implemented these good
practices over the last few years, the
business has continued to grow, and I am
pleased to be able to note another year of
impressive financial results.
Quick link
https://www.experianplc.com/
about-us/corporate-
governance/board-committees/
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Governance
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Report on directors’ remuneration
continued
In FY23, Latin America once again achieved
outstanding, double-digit Benchmark EBIT and
organic revenue growth. All other regions also
delivered single-digit growth*. This strong
performance pushed the Group to high
single-digit growth for both annual bonus
performance metrics. FY23 revenue
performance growth, for annual bonus
purposes, was 8% and this high level of
revenue performance, combined with strong
returns on strategic investments and prudent
financial management of expenses, flowed
through to Benchmark EBIT growth of 9% for
FY23.
As a result of the combined revenue growth
and Benchmark EBIT growth performance, the
overall bonus for FY23 will be paid out at 59%
of maximum for each of the executive
directors.
Following a review of the Group’s financial
performance and consideration of all
business priorities, including those that
are non-financial in nature, the Committee
was satisfied that the level of bonus payout
aligned fairly and accurately to the year’s
achievements. Therefore, no discretion
(upwards or downwards) was deemed
necessary. Full details of the annual bonus
outcomes are set out in the Annual report on
directors’ remuneration.
Long-term incentives (LTI):
The Performance
Share Plan (PSP) and Co-investment Plan (CIP)
awards granted in 2020 will vest on 11 June
2023. The 2020 LTI targets were set in
November 2020, when our growth ambitions
were to achieve sustainable annual high
single-digit growth. The strong financial
performance in FY23 follows a resilient
FY21 and a very good FY22 performance.
We continue to believe that a healthy,
well-run business will create wealth for its
shareholders, and over the last three years
Experian has achieved:
a
11% average increase per annum in adjusted
Benchmark EPS
a
US$5.2bn three-year cumulative
Benchmark operating cash flow
a
17% adjusted Return on capital employed
a
11% share price growth
a
£4.8bn of value creation through market
capitalisation growth and dividends.
This strong performance underpins the overall
vesting levels of the PSP, which vested at 75%,
and of the CIP, which vested at 100%. While the
impact of the pandemic in the first year of the
performance period undoubtedly affected the
potential performance outcomes that may
have otherwise been achieved, no adjustments
were made in assessing the performance
outturns for the 2020 LTI plans.
Annual performance
a
9% Benchmark EBIT growth*
a
8% revenue performance growth¹*
a
Increased headcount to 22,000²
These broad non-financial measures include,
but are not limited to, employee engagement,
diversity and inclusion, impact on the
environment, and customer satisfaction. In this
way, we ensure the financial outputs are a fair
and true reflection of the Group’s overall
performance over the period.
We are very transparent about our targets and
progress towards them in many areas, such as
diversity and impact on the environment, but
we do not include these and other
non-financial metrics in our incentive plans.
However, that in no way dilutes their
importance to the Group. They are regularly
reviewed by the Board and they remain key
considerations for the Committee’s review of
short- and longer-term performance.
How is our performance reflected in
executive pay?
Salary:
During the year the Committee
approved salary increases of 2.4% – 2.5% for
the executive directors. As in previous years,
and aligned with our policy, these increases
were in line with or below the increases
awarded to the general employee population
across the Group.
Annual bonus:
The Committee always seeks to
set stretch annual bonus performance targets
that reflect our strong pay-for-performance
philosophy. For FY23, the Committee set
targets that reflected our unchanged ambition
of strong levels of growth. Despite the
anticipated challenges of a volatile external
environment, the performance range was set
with a true stretch that required high
single-digit growth to achieve target and
double-digit growth to achieve maximum
results.
Three-year performance
a
11% average increase per annum in
adjusted Benchmark EPS
a
11% share price growth³
a
US$5.2bn cumulative Benchmark
operating cash flow over three years
*
At constant exchange rates.
1
From ongoing activities.
2
Headcount as at 31 March 2023 22,000 (31 March 2022:
20,600).
3
Three-month average to 31 March 2023 of £28.54
compared to the three-month average to 31 March 2020
of £25.63.
FY23 at a glance
FY23 performance
As our business results have evidenced, our
approach to supporting our employees with
specific issues or broader developments, such
as more flexible working, results in a more
engaged and motivated workforce. According to
employee feedback, this is enabling us to attract
and retain talent, which is critical to our growth
ambitions.
People first initiatives
Some examples of the policies introduced to
ensure that we maintain our focus on our
employees are outlined below:
a
Enhanced flexible working policies, including
global adoption of hybrid working and
refurbished/new offices to provide
collaborative and flexible working
environments
a
Providing training to support employees
with their preferred way of working
a
Family-friendly policies, including improved
maternity, paternity and neonatal leave
a
Increased mental health and wellness
programmes
a
We invested in a world-class digital learning
platform.
Over the past three years, we have been
impressed by the resilience, commitment and
productivity of our employees as they overcame
the challenges of the pandemic. Again in FY23,
the collaborative and innovative culture at
Experian played an important role in the
delivery of a strong overall performance.
Supporting and developing our people will
remain a key strategic enabler for Experian as
an important way to recognise the commitment
and productivity of our employees.
FY23 performance
I am pleased to report that FY23 was another
strong year for Experian. In the current
economic circumstances, to deliver high
single-digit growth in both revenue and
Benchmark earnings reflects the quality and
resilience of the business. We believe that
these results demonstrate the important
combination of a robust business strategy and
the proven ability to execute that strategy.
We set stretch targets that would require us to
deliver sustainable high single-digit growth in
FY23 and the Group achieved this ambition,
with Benchmark EBIT growth of 9%, revenue
performance growth of 8% and Benchmark
EPS growth of 9%, all at constant exchange
rates. These high single-digit performance
levels were also reflected in our share price,
which increased by 11% over the three-year
performance period
3
.
While achieving financial results is
undoubtedly very important, the Committee
undertakes a holistic approach to assessing
the Company’s performance by reviewing a
broad range of metrics.
Experian plc
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Remuneration
As with the annual bonus plan, the Committee
considered the LTI vesting levels in the context
of both the current economic environment and
the Group’s holistic performance over the
three-year period. It was decided that the
formulaic vesting levels appropriately reflect
the strong business outcomes achieved over
the three-year performance period.
In line with our remuneration principles,
a substantial portion of the CEO’s single
figure value is determined by long-term
performance. For FY23, 67% of the CEO’s
single figure value is due to the vesting
levels of the LTI plans. It is important to note
that all shareholders, including employee
shareholders, could have benefitted from
the same share price growth and dividend
return over the same three-year period.
Pay in the wider workforce
Employee engagement
The Remuneration Committee is well informed
about the pay and related policy arrangements
for the broader employee population at
Experian. As the Committee had existing
processes in place to gain an extensive
understanding of employee pay, prior to
the introduction of the 2018 UK Corporate
Governance Code (the Code) requirements,
no single approach recommended in the Code
was considered appropriate for our business.
We have therefore adopted a combination of
the suggested methods to comply with the
Code’s requirements.
Each year, as part of the Committee’s standing
agenda, we are provided with an extensive
paper setting out details of all employee pay
and workforce policies across Experian. The
discussions on this topic have enabled us to
proactively incorporate wider employee pay
as important context for framing executive
pay considerations. This year we were also
provided with greater insights into the
remuneration and benefit arrangements,
including gender pay positioning in our major
regions, which facilitated informative and
insightful discussions regarding diversity,
equity and inclusion (DEI) practices in our
major markets.
Following in my predecessor's footsteps,
this year I had the opportunity to further
supplement the Committee’s understanding
of the pay and related policies for the broader
workforce by attending our UK and Ireland
Experian People Forum, in person. The
two-way discussions were open and candid,
which provided powerful feedback.
Unsurprisingly, the cost-of-living issue was
on the agenda and pleasingly the forum
expressed an overwhelmingly positive
employee response to the measures that had
been put in place to support our lower-earning
employees. I was very impressed with the
level of engagement from employees and the
nature of the discussions on every topic from
Sharesave limits to the flexible ways of
working.
It was apparent that employees appreciate the
open and honest engagement style that our
senior leaders consistently demonstrate. The
continuing investments that have been made
into employee mental health and financial
wellbeing were hugely valued. Employee
appreciation for the enhanced flexibility
provided in working from home and the
developing practice of hybrid and remote
working was voiced strongly. We decided to
invest in making our work locations more
attractive places for employees whose
preference is to work from an office
environment. With our enhanced flexible-
working environment and supporting policies
combined with our broader reward offering,
I was pleased to hear that we are well
positioned to continue to attract and retain
key talent.
People and culture
The Experian Way is our unique and consistent
way of working globally and informs how our
people act and behave, thus shaping our
culture. Experian's culture is a key enabler of
our success, as evidenced by our track record
of strong financial performance. Creating
and maintaining an agile, innovative, high-
performance culture remains a key priority for
Experian as we look to maintain and further
develop an environment that enables our
employees to perform and be successful.
The collegiate nature of the Experian Way,
generated via our connected global network,
has undoubtedly supported the achievement
of our very strong financial results. The early
indications are that we are successfully
addressing the challenge of maintaining our
strong culture in the new working world,
where remote working becomes the normal
practice and the majority of the workforce
work remotely.
We started to participate in the Great Place
To Work global survey in 2021, and the results
to date show that the employee-focused
initiatives introduced in recent years have been
appreciated by our employees. Measuring
culture is undeniably difficult but it is clearly
a key enabler of business performance.
To inform our own assessment of culture, the
Committee considers a range of quantitative
culture-related data. The quantitative data
may also provide useful information for our
investors and other stakeholders. Further
insights on these important metrics can
be found in the Sustainable Business
Performance Data, including specific
disclosures on Experian employee attrition
and workforce composition. Details on DEI
can be found on pages 51 and 52.
Experian’s executive remuneration
policy
In recent years, we have benefitted from open
and constructive shareholder engagement,
which led to a number of changes to our
Remuneration Policy at the 2020 AGM.
Following these changes, we have been
consistently applying the Remuneration Policy,
and also incorporated some governance-led
best-practice elements as appropriate. I was
very pleased to see the strong level of
shareholder support we received for our
Remuneration Report at the 2022 AGM (95.7%).
This Annual Report on directors’ remuneration
will be put to shareholders for an advisory vote
at the AGM on 19 July 2023, and we hope to
receive investor support as no changes have
been made to the policy.
The Committee proactively considers
the incentive arrangements each year, to
ensure they continue to be fit for purpose and
aligned with the Group’s long-term strategy.
It is also important for the Policy to reflect
the rapidly changing environment which
we operate in. The Committee is confident
our current Remuneration Policy remains
the most appropriate for our business,
and its application is a critical enabler of
our long-term strategic objectives, as it is
designed to:
a
achieve strong financial performance
a
incentivise long-term sustainable growth
a
ensure effective shareholder alignment
a
facilitate the attraction of critical talent.
We have remained consistent with the Policy
and approach throughout the external
environment challenges of recent – and still
current – times that has enabled Experian to
focus on our long-term growth strategy. Our
Remuneration Policy, and in particular its
incentive plans, continued to test and motivate
our leadership teams to successfully achieve
exceptional growth. Importantly, we were able
to retain critical talent and we did not need to:
a
make any changes to our current LTI plans,
including the performance targets
a
make any change to the performance
metrics or evaluation methodology.
In November 2022 and again in February 2023,
we issued letters to our major shareholders
and the proxy advisory bodies. These letters
were an update on our approach to executive
pay in FY23 and our Remuneration Policy, to
invite any comments and feedback. We were
very pleased to receive a lot of support for our
current approach to executive remuneration.
For full transparency we have included some
details on the questions raised and our
responses, to provide some additional context.
123
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
Looking forward
Following another year of delivering strong
financial growth, we look forward with a lot of
positive momentum. The external environment
continues to bring many challenges but I
remain very confident that we will continue to
achieve our ambitions of strong growth and
financial outcomes, and high levels of business
performance underpinned by long-term
strategy and investment. The combination of
the investments that we have made, the
decisions that we have taken and a focus on
executing our business plans across all our
key markets, can make FY24 another good
performance year for Experian.
I joined the Experian Board in September 2020
and when I became Remuneration Committee
Chair at the conclusion of the 2022 AGM, I was
very pleased to be inheriting the role with very
strong shareholder engagement and support
for our executive remuneration arrangements.
In advance of this year’s Remuneration Policy
vote, I have been hugely encouraged by the
nature of our shareholder consultation.
The engagement has been conducted in our
usual open and constructive manner and the
ability to listen, discuss and act upon the
insightful feedback from our major
shareholders and the proxy advisory bodies is
incredibly valuable.
I hope that I have provided some helpful
background and broader context on Experian's
FY23 performance that enables shareholders
to support both our Remuneration Policy and
our Annual report on directors’ remuneration
at the 2023 AGM.
Report on directors’ remuneration
continued
Q&A
A:
No. We are simply incorporating the
recently made change to align the pension
provision of our incumbent UK-based
executive directors to that of the majority
of the UK wider workforce. As we have
previously disclosed, the Committee
proactively considers the Remuneration Policy
each year, to ensure it continues to be fit for
purpose, remains aligned with the Group’s
long-term strategy, and also reflects the
rapidly changing environment we operate in.
The proposed policy will be put to
shareholders for approval under an advisory
vote at the AGM on 19 July 2023.
We do not therefore propose to make any
changes to our Remuneration Policy in 2023.
However, we highly value our investors'
insights and will maintain our approach to
meaningful, open and honest engagement.
Q: Is Experian making any changes to the
Remuneration Policy when it is renewed
at the 2023 AGM?
Q: Does Experian anticipate
incorporating environmental, social
and governance (ESG) metrics into the
executive incentive plans?
A:
To date, we have undertaken a number of
steps to ensure that we continue to operate
very responsibly across the ESG spectrum as
part of the Company’s ‘DNA’ without needing
to incorporate a specific metric into our
incentive plans.
During the process of considering the
renewal of our Remuneration Policy this year,
the Board and Remuneration Committee
have thought long and hard about our
position in relation to ESG. For example,
some observers suggest that including
Scope 1, 2 or 3 emissions incentive targets
would be straightforward. However, it’s
important to note that we are not a
The current cost-of-living challenge has again
demonstrated our strong track record of
putting our employees first by focusing on
those who need the support the most. As an
example, our lowest paid UK employees have
received a one-off allowance to help with the
impact of rising inflation. In addition, we have
taken the opportunity to remind all our
employees about the resources and support
that are available to them as part of our
financial wellbeing offer. This includes support
across a whole range of topics including
financial planning, mortgage advice, loan and
debt management, helpful guides, tax
planning and financial protection as well as
highlighting our employee benefits.
Q: Many FTSE 100 companies are
looking to support their employees
as they face the cost-of-living crisis.
What steps, if any, has Experian taken
to help the wider workforce?
A:
As we have previously disclosed, even
before the onset of the COVID-19 pandemic,
our focus had been on ensuring we continue to
protect our employees, our shareholders, and
the societies in which we operate. We ensured
that all our employees were provided with
important support to deal with both the
personal and professional challenges to be
able to work safely and effectively from home.
Thank You Shares
a
In August 2021, we granted shares
worth US$800 to all employees below
senior management, with the promise
of a further two-for-one matching share
award in August 2024 if employees
chose to retain their original share
award.
a
The purpose of the Award was to thank
employees for their dedication and
resilience over the pandemic, and by
offering the award in shares together
with the future matching award, we can
ensure all employees can benefit from
our future share price growth ambitions.
a
The plan was very well received by
employees, with 75% of employees still
holding their original shares more than
21 months after the original grant.
carbon-intense business and are already
making very good progress on carbon
reductions and include significant details in
our Annual Report. As we have a strong
preference to reward our executive directors
for the achievement of strategic rather than
baseline objectives, carbon targets do not
seem to us to be the right area for focus.
We believe any metric included would need
to resonate strongly with our purpose of
creating a better tomorrow by improving
financial inclusion. Our view is that
determining an appropriate financial
inclusion metric is far from straightforward
and thus it will take time to develop and test
a metric that is robust enough to include in an
incentive framework. Financial inclusion is
not only about improving the access to
financial resources. It is important to
understand the true benefits of that access. It
is arguably slightly easier to develop a metric
that could be used in our Consumer Services
business but focusing solely on such a metric
could inadvertently skew our incentive
approach away from the full breadth of our
businesses across the Group. So, we will
continue to explore the potential introduction
of a purpose-driven ESG metric and maintain
our very constructive engagement with our
major shareholders on that journey.
We also recognised the hard work and
commitment of our employees by granting
US$800 worth of Thank You Shares to all
employees below senior management level.
Experian plc
Governance
124
Code principle
Remuneration
Performance snapshot
Performance measure
Incentive plan
Outturn
Achievement
(% of max)
Benchmark EBIT growth*
Annual bonus
9%
60%
Revenue performance growth*
Annual bonus
8%
55%
Three-year adjusted Annual Benchmark EPS growth*
CIP/PSP
11.2%
100%
Three-year cumulative Benchmark operating cash flow*
CIP
US$5.2bn
100%
Three-year adjusted Return on capital employed
PSP
17.0%
100%
Three-year TSR outperformance of FTSE 100 Index
PSP
-7.5%
0%
*
At constant exchange rates.
**
Positive employee engagement as measured in the 2023 Great Place to Work survey.
As a result of the performance shown above:
Our executive remuneration at a glance
9
%
Benchmark EBIT growth*
Executive director remuneration arrangements for FY24
The CIP is designed
to incentivise cash
discipline while the
PSP is designed
to incentivise
shareholder returns.
Revenue growth is a
key metric for us and
will provide a quality
of earnings balance
to the important
profit focus of
Benchmark EBIT.
However, growth
is the single most
important aspect
of our business
strategy and therefore
adjusted Benchmark
EPS runs across
both plans.
Our executive pay framework
Annual
bonus
CIP
PSP
Share ownership
As at 31 March 2023 and calculated as outlined on page 136.
Kerry Williams stepped down from the Board at last year’s AGM on 21 July 2022 but continued to work for the Group before retiring on 31 March 2023.
Brian Cassin
Actual holding 19 x salary
16
3
Lloyd Pitchford
Actual holding 17 x salary
15
2
Craig Boundy
Actual holding 7 x salary
5
2
Annual report on directors’ remuneration
8
%
Revenue performance*
USc
135.1
Benchmark EPS
17.0
%
Adjusted Return on
capital employed
82
%
Employee engagement**
Executive director single figure of pay
Brian Cassin
£7.37m
Lloyd Pitchford
£4.55m
Kerry Williams
& Craig Boundy
US$7.3m
Fixed elements of pay:
Base salary
Pension and benefits
Variable elements of pay:
Annual bonus
Share-based incentives: value at grant
Share-based incentives: value attributable to share
price growth and dividend equivalent payments
’000
0
2,000
4,000
6,000
8,000
Incentive awards timelines
Grant
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Annual bonus
CIP
PSP
Performance period
Holding period
Guideline
Additional holding
a
Salary increases
of 2.5% awarded to executive directors effective
1 June 2023.
a
Pension
contributions for UK-based executive directors were
aligned with the rate provided to the majority of the UK workforce
(10% of salary) from 1 January 2023 (previously already aligned
in USA).
a
Annual bonus
based on Benchmark EBIT (80%) and revenue
performance (20%). The opportunity is 200% of base salary.
Half of any payout must be deferred into the CIP for three years.
a
CIP awards
will be based on cumulative Benchmark operating
cash flow (50%) and adjusted Benchmark EPS (50%). The
maximum award remains a 2:1 match.
a
PSP awards
will be based on TSR (25%), adjusted ROCE (25%) and
adjusted Benchmark EPS (50%) performance. The opportunity of
200% of base salary is unchanged.
a
Two-year post-vest holding
period applies to both CIP and
PSP awards.
a
Malus and clawback
provisions apply to all incentive awards.
a
Existing in-employment shareholding guidelines
will apply for
two years post-employment.
80%
Benchmark
EBIT
20%
Revenue
50%
Adjusted
Benchmark
EPS
50%
Cumulative
Benchmark
operating
cash flow
50%
Adjusted
Benchmark
EPS
25%
ROCE
25%
TSR
125
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
Our remuneration policy at a glance
Policy summary
Element
Key feature
Link to strategy
Any proposed changes and rationale for FY24
Salary and
benefits
a
Salary is reviewed annually with reference
to market data. Any increases are reflective
of those provided to our wider workforce.
Set at a level appropriate to secure and retain
high-calibre individuals needed to deliver the
Group’s strategic priorities.
No change.
Pension
a
Brian Cassin and Lloyd Pitchford may
participate in the UK defined contribution
plan and receive a 10% employer
contribution.
a
Craig Boundy is eligible to participate in the
US 401K plan and receive an employer
contribution aligned with US employees.
To provide appropriate retirement savings,
at a rate aligned with local markets.
No change.
Pension for UK-based executive directors is
aligned with the workforce (effective from
1 January 2023).
Bonus
a
100% of salary at target and 200% at
maximum.
a
Mandatory 50% deferral into shares under
the CIP for three years. Executives may
defer up to 100% of bonus into CIP.
To incentivise delivery of our annual strategic
goals.
Deferral into shares balances short- and
long-term strategic focus.
No change.
Co-investment
Plan
a
Conditional award of matching shares on
the gross value of bonus deferred into
shares.
a
Matching shares granted on a 2-for-1 basis
and vest subject to the achievement of
financial performance conditions over a
three-year period.
a
Two-year post-vest holding period applied.
Personal investment from executives ensures
continued long-term alignment with
shareholder interests.
Use of stretch financial metrics incentivises
performance over long-term horizons.
No change.
Performance
Share Plan
a
Annual grant of performance shares up to
200% of salary for executive directors.
a
Shares only vest to the extent performance
conditions are met over a three-year
period.
a
Two-year post-vest holding period applied.
Outcome driven by performance against
measures directly linked to financial returns
and strategic priorities.
Majority of remuneration opportunity (CIP
and PSP) is linked to the Group’s long-term
performance.
No change.
Shareholding
a
In-employment shareholding guideline of
300% of salary for the CEO and 200% of
salary for the other executive directors.
a
Two-year post-employment shareholding
guidelines equal to the in-employment
guideline or, if lower, actual shareholding
at cessation.
To preserve and enhance the long-term
alignment of executive directors with
shareholder interests and promote a
long-term approach to performance and
risk management.
No change.
Pay scenarios
The above charts are prepared on the following basis:
Fixed pay:
includes FY24 base salary, FY24 cash in lieu of pension allowances and assumes a similar value of benefits as FY23.
Target:
includes fixed pay plus the level of performance required to deliver 50% of the maximum annual bonus, and 50% of the maximum PSP and CIP awards respectively, with the CIP matching award
being based on 100% deferral.
Maximum:
includes fixed pay plus the maximum annual bonus payment and full vesting of the CIP and PSP awards, with the CIP matching award being based on 100% deferral of a maximum annual
bonus.
Maximum:
with 50% share price increase: includes all elements included in maximum and assumes the share price increases 50% above that on the date of grant. The 50% share price increase has been
applied to shares received under the PSP and matching shares awarded under the CIP. Dividend equivalents are excluded from the above scenario models.
Brian Cassin
(£’000)
1,176
4,311
9,536
12,671
100%
27%
12%
9%
24%
49%
22%
66%
16%
75%
14,000
12,000
Fixed
pay
Target
Maximum Maximum
with 50%
share
price
increase
10,000
8,000
6,000
4,000
2,000
0
Lloyd Pitchford
(£’000)
732
2,670
5,900
7,838
100%
27%
12%
9%
24%
49%
22%
66%
16%
75%
14,000
12,000
Fixed
pay
Target
Maximum Maximum
with 50%
share
price
increase
10,000
8,000
6,000
4,000
2,000
0
Craig Boundy
(US$’000)
1,104
4,179
9,304
12,379
100%
26%
12%
9%
25%
49%
22%
66%
16%
75%
14,000
12,000
Fixed
pay
Target
Maximum Maximum
with 50%
share
price
increase
10,000
8,000
6,000
4,000
2,000
0
Fixed
Annual bonus
Long-term incentives
The charts illustrate, for
various pay scenarios,
the potential future total
remuneration that each
executive director may
realise under the
proposed Policy.
Annual report on directors’ remuneration
continued
Experian plc
Governance
126
Code principle
Remuneration
This Annual report on directors’ remuneration will be put to shareholders for an advisory vote at the AGM on 19 July 2023. The Remuneration
Committee has prepared it on behalf of the Board, in line with the UK Companies Act 2006, Schedule 8 to the UK Large and Medium-sized Companies
and Groups (Accounts and Reports) Regulations 2008 (as amended) and the Listing Rules of the UK Financial Conduct Authority. All of the sections
that have been audited by the Company’s external auditor, KPMG, have been noted.
What did we pay our executive directors in the year? (audited)
The table below shows the single total figure of remuneration for the executive directors, for the years ended 31 March 2022 and 31 March 2023.
Further explanatory information is set out below the table.
Brian Cassin
Lloyd Pitchford
Craig Boundy
Kerry Williams
2023
£’000
2022
£’000
2023
£’000
2022
£’000
2023
US$’000
2022
£’000
2023
US$’000
2022
US$’000
Fixed pay
Gross salary
1
1,016
991
628
613
695
n/a
327
1,049
Total fixed pay
1,016
991
628
613
695
n/a
327
1,049
Benefits
27
26
21
59
55
n/a
4
40
Pension
178
198
110
122
–
n/a
4
12
Total fixed remuneration
1,221
1,215
759
794
750
n/a
335
1,101
Performance-related pay
Annual bonus
1,199
1,982
740
1,225
820
n/a
386
2,092
Share-based incentives
Value delivered through performance
2
4,557
5,154
2,812
3,180
n/a
n/a
4,599
5,211
Value delivered through share price growth
and dividends
3
394
228
243
141
n/a
n/a
408
248
Total variable remuneration
6,150
7,364
3,795
4,546
820
n/a
5,393
7,551
Total single figure of remuneration
4
7,371
8,579
4,554
5,340
1,570
n/a
5,728
8,652
1
For Kerry Williams and Craig Boundy, the salary also reflects the timing of US payroll payments and time served during the financial year as an executive director.
2
Value delivered through performance is calculated as the number of shares vesting under the CIP and PSP multiplied by the share price on the date of grant. None of the executive directors exercised share
options in the year ended 31 March 2023. For Kerry Williams and Craig Boundy this reflects time served during the financial year as an executive director.
3
For FY23, the value delivered through share price growth and dividends is calculated as (i) the difference between the average share price in the last three months of the financial year and the share price
on the date of grant multiplied by the number of vested performance shares, plus (ii) dividend equivalent payments for the number of vested performance shares.
4
For FY23, the total single figure of remuneration for Brian Cassin and Lloyd Pitchford in US$, applying the average exchange rate over the year of £1:US$1.2046 (2022: £1:US$1.3665), is US$8.9m
(2022: US$11.7m) and US$5.5m (2022: US$7.3m) respectively.
How has the single figure been calculated? (audited)
Salary
Salary increases typically take effect from 1 June. The Committee approved salary increases for executive directors of 2.4% to 2.5% with effect from
this date:
1 June 2022
‘000
1 June 2021
‘000
%
increase
Brian Cassin
£1,020
£995
2.5%
Lloyd Pitchford
£630
£615
2.4%
Craig Boundy
US$1,000
—
—
Kerry Williams
US$1,075
US$1,050
2.4%
In awarding these increases, we considered a number of factors, including the approach to employee remuneration throughout the Group, the
prevailing economic conditions and positioning against the market as well as individual performance. The salary review budget for FY23 for our
employees in the USA and UK was 4%.
127
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
Benefits and pension
Taxable benefits include life insurance, private healthcare, a company car or car allowance and, where relevant, the value of any gain realised on
exercising Sharesave options.
Brian Cassin and Lloyd Pitchford are eligible to participate in a defined contribution pension plan but elected not to do so during the year ended
31 March 2023. In 2023, Brian Cassin received a cash supplement of £177,677 (2022: £198,250), and Lloyd Pitchford received a cash supplement
of £109,750 (2022: £122,500), in lieu of their pension contributions.
Kerry Williams participated in a defined contribution plan (401k). The company contribution to this during the part of the year that he served as an
executive director was US$4,423 (2022: US$11,831). Craig Boundy does not participate in a defined contribution plan (401k).
No executive director has a prospective right to a defined benefit pension.
Annual bonus
Overview
All Experian employees participate in a variable pay plan. We have one annual bonus plan in operation across Experian and the majority (c.16,000) of
our workforce participate in this plan. The remainder of employees participate in a sales commission plan. How the annual bonus plan works varies
slightly depending on region and grade. For the vast majority of employees, annual bonus awards are based on the performance of their particular
business line or region.
Executive directors are required to defer half of any annual bonus earned for three years through the CIP, although they may choose to defer more.
This year, as in previous years, all three executive directors in office at 31 March 2023 chose to voluntarily defer their full bonus payments into the CIP.
Our executive annual bonus plan is based upon two performance metrics, which are Benchmark EBIT growth (80% weighting) and revenue
performance (20% weighting). Benchmark EBIT is an important earnings metric and focuses on items directly within management’s control.
To balance the profit focus of Benchmark EBIT, revenue performance growth was added to the bonus plan in FY20 to provide an important quality
of earnings element to the annual performance.
How do we set the bonus targets?
Performance-related pay is a key component of our reward structure for all employees and, as such, setting stretch targets is a critical focus area for
the Committee. Every year we undertake a rigorous exercise to ensure our targets are sufficiently stretching, taking into consideration the external
marketplace and our own performance aspirations. The Committee considers targets at two separate Remuneration Committee meetings during the
year:
Step 1
In January, the Committee considers the
wider market context, and is presented with
an early indication of how performance is
tracking in the current year.
The Committee’s independent remuneration
advisers are invited to provide the Committee
with a wider assessment of the pay and
governance environments in the relevant
locations for our business.
Step 2
In March, budgets for the forthcoming year
are discussed and agreed by the Board.
At its March meeting, the Committee
has a first look at possible targets for the
forthcoming year, taking into account a
number of factors including:
the strategic plan
brokers’ earnings estimates
wider economic expectations
our key competitors’ earnings estimates,
including a number of different peer
groups.
Step 3
By the time the Committee meets again
in May, budgets for the forthcoming year
have been agreed and the performance
outcomes for the current year have been
reviewed by our auditor.
The Committee takes these into account
during its determination of prior year
outcomes and its final review of the
targets for the current year, before
signing them off.
The Committee is able to take a holistic approach to setting targets, as all our non-executive directors sit on the Remuneration Committee, as well as
on all of our other principal Board Committees. This ensures Committee members are fully apprised of the wider business context and the Group’s
business prospects over the coming years, particularly as the Board meeting to discuss the budget and business plan usually takes place prior to the
Remuneration Committee meeting.
Annual bonus outcome
Revenue performance is calculated as the Group total revenue growth after the removal of intra-Group sales, and Benchmark EBIT is based on
ongoing activities. Performance is measured on a constant currency basis to strip out the effects of exchange rate fluctuations, which are outside of
management’s control. The Committee also excludes the impact of any material acquisitions or disposals made in the year, to ensure both metrics are
measured consistently, which is in line with our approach to long-term incentive plan measures.
The FY23 annual bonus targets were set at a stretch level that, for both metrics, required double-digit growth to achieve maximum. Building on the
resilient performance of recent years, these targets were designed to signal our continued growth ambitions.
Annual report on directors’ remuneration
continued
Experian plc
Governance
128
Code principle
Remuneration
The table below shows our growth in Benchmark EBIT and revenue performance for bonus purposes relative to the FY23 agreed targets.
Metric
Weighting
% growth
required for
threshold payout
% growth
required for
target payout
% growth
required for
maximum payout
FY23 actual
growth
Annual bonus
achievement
Benchmark EBIT growth
80%
6%
9%
11%
9.4%
119%
Revenue performance growth
20%
6%
8%
10%
8.2%
111%
Total annual bonus achievement as % of on-target
118%
Before approving the annual bonus outcomes, the Committee discussed whether or not the proposed payout was appropriate in the context of both
the current external environment and the Group’s wider business performance during the year. The Committee also considers other factors reviewed
by the Board, such as our Net Promoter Score, employee experience, employee engagement results, direct employee feedback to the Committee
Chair at the People Forum, and the broader stakeholder experience over the financial year.
The Committee agreed that the Company’s financial performance was aligned with its holistic assessment of performance and was also satisfied
that it did not need to exercise any discretion, and that the level of bonus payout was appropriate.
As such, the resulting annual bonus outcomes for each executive director (up to a maximum of 200% of salary), for the year ended 31 March 2023,
are set out in the table below.
FY23
Bonus payout
‘000
Bonus payout
% salary
% bonus
deferred
under the CIP
Brian Cassin
£1,199
118%
100%
Lloyd Pitchford
£740
118%
100%
Craig Boundy
1
US$820
118%
100%
Kerry Williams
1
US$386
118%
n/a
1
Bonus amounts for Craig Boundy and Kerry Williams reflect the time served as an executive director during the financial year.
Each of the eligible executive directors has elected to defer their full bonus into Experian shares under the CIP for a three-year period. Deferred bonus
shares are not subject to any further conditions but may be matched, subject to the conditions set out in the CIP awards section below.
Share-based incentives
The share-based incentive amount included in the single total figure of remuneration is the combined value of the CIP and PSP awards vesting in
respect of the relevant financial year. For FY23, these relate to the awards granted on 11 June 2020 and for FY22 they relate to the awards granted
on 12 June 2019. Vesting in 2023 for both the CIP and PSP awards is determined based on performance over the three years ended 31 March 2023,
as well as continued service.
The 2020 LTI targets were set in November 2020, when our growth ambitions were to achieve sustainable annual high single-digit growth and the
Committee has not exercised any discretion, nor made any adjustments, in determining the vesting outcomes for the 2020 LTI awards. Our resilient
performance in the first year of the performance period at the onset of the global COVID-19 pandemic, combined with our strong financial
performance in second and third years of the performance period, resulted in the formulaic vesting results outlined in the table below. The Committee
reviewed the financial performance, but also considered the experience of our investors, employees and other stakeholders over the three-year
performance period. Through this broadest lens, the Committee judged the formulaic results to be fair and balanced and, as such, did not make any
adjustments to the vesting results. The tables below show the performance achieved on the targets for the CIP and PSP awards granted in June 2020:
CIP awards
Performance measure
Weighting
Vesting
1
Actual
Percentage
vesting
2
No match
1:2 match
1:1 match
2:1 match
Benchmark Earnings per share (average
annual growth)
50%
Below 3%
3%
4%
7%
11.2%
50%
Cumulative Benchmark operating cash flow
3
50% Below US$3.7bn
US$3.7bn
US$3.8bn
US$4.1bn
US$5.2bn
50%
Total
100%
PSP awards
Performance measure
Weighting
Vesting
1
Actual
Percentage
vesting
0%
25%
50%
100%
Benchmark Earnings per share (average
annual growth)
50%
Below 3%
3%
4%
7%
11.2%
50%
Adjusted Return on capital employed
25%
Below 14.5%
14.5%
15.4%
16.0%
17.0%
25%
TSR of Experian vs TSR of FTSE 100 Index
25%
Below Index
Equal to Index
8.3% above Index
25% above Index
Below Index
0%
Total
75%
1
Straight-line vesting between the points shown.
2
The maximum opportunity, which requires 100% vesting, results in a two-for-one match on the bonus deferred.
3
In line with the approach taken in previous years, the cumulative Benchmark operating cash flow targets shown above have been adjusted compared to those originally set to take into account the impact
of acquisitions and disposals made over the performance period. The actual cumulative Benchmark operating cash flow over the performance period, of US$5.2bn, is determined on a constant currency
basis. This is in line with our approach for all performance metrics, to ensure that awards are measured on a consistent basis.
No discretion was applied in determining the share-based payments that vested in either FY23 or FY22.
129
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
The June 2020 awards had not vested at the date this report was finalised, and so the reported value of the awards has been based on the average
share price in the last three months of the financial year, which was £28.54. The value of the awards included in the single total figure of remuneration
is as follows:
CIP
PSP
Value of
shares
vesting
‘000
Value of
dividend
equivalent
payments
‘000
Total value
of shares
vesting and
dividend
payments
‘000
Shares
awarded
Shares
vesting
Shares
awarded
Shares
vesting
Brian Cassin
113,971
113,971
70,335
52,751
£4,759
£193
£4,952
Lloyd Pitchford
70,325
70,325
43,394
32,546
£2,936
£119
£3,055
Craig Boundy
78,502
78,502
35,691
26,768
US$3,653
US$156
US$3,809
Kerry Williams
94,570
94,570
58,426
43,820
US$4,802
US$205
US$5,007
Shares awarded in the above table to Craig Boundy were made prior to his appointment as a director.
The value of Craig Boundy’s and Kerry Williams’ shares has been converted into US dollars at a rate of £1:US$1.22, which is the average rate during
the last three months of FY23.
Dividend equivalents of 148.25 US cents per share will be paid on vested shares. These represent the value of the dividends that would have been paid
to the owner of one share between the date of grant and the date of vesting.
0%
20%
40%
60%
80%
10
0%
FY23
Fixed
Annual bonus
LTI vesting
LTI – share price
and dividends
17%
16%
62%
5%
Breakdown of FY23 CEO single figure
%
Update to 2022 disclosure
We originally calculated the value of the share awards realised by our executive directors in 2022 using the average share price from 1 January 2022
to 31 March 2022, in line with the prescribed single figure methodology. This has now been revised to reflect the actual share price and exchange rate
on vesting, as follows:
Three-month
average share
price to
31 March 2022
Estimated value
of long-term
incentive awards
‘000
Share price
on vesting
Actual value
of long-term
incentive awards
‘000
Brian Cassin
£6,741
£5,382
Lloyd Pitchford
£30.15
£4,160
£23.86
£3,321
Kerry Williams
US$7,499
US$5,459
The chart to the right shows the make-up of the CEO’s FY23 single figure
value, including £4.9m relating to the LTI.
Of the £4.9m LTI value disclosed for the CEO, 92% is the value at grant,
3.9% is the value of dividend equivalent payments and 4.1% is a result of
share price growth between the grant date and the average price over
the last three months of the financial year.
Annual report on directors’ remuneration
continued
Experian plc
Governance
130
Code principle
Remuneration
What share-based incentive awards did we make in the year? (audited)
On 8 June 2022, awards were granted to the executive directors under the CIP and PSP. The face value of awards made to Brian Cassin and Lloyd
Pitchford is shown in pounds sterling; the face value of awards made to Craig Boundy and Kerry Williams is shown in US dollars. The number of
shares awarded to Craig Boundy and Kerry Williams was calculated using the average exchange rate for the three days prior to grant of £1:US$1.24.
All awards have been calculated using a three-day average share price.
In line with the CIP rules, invested shares for Brian Cassin and Lloyd Pitchford were purchased with their bonuses net of tax. In line with the rules of
The Experian North America Co-investment Plan, invested shares for Craig Boundy and Kerry Williams were calculated with reference to their gross
bonuses. Matching awards are based on the gross value of the bonus deferred.
Details of these awards are set out in the following table:
Type of interest in shares
Basis of award
Face value
‘000
Number
of shares
Vesting at threshold
performance
Vesting date
Brian Cassin
CIP invested shares
Deferred shares
100% of net bonus
£1,026
39,967
n/a
8 June 2025
CIP matching shares
1
Conditional shares
200% of value of gross bonus deferral
£3,965
154,463
25%
8 June 2025
PSP
2
Conditional shares
200% of salary
£2,040
78,988
25%
8 June 2025
Lloyd Pitchford
CIP invested shares
Deferred shares
100% of net bonus
£634
24,696
n/a
8 June 2025
CIP matching shares
1
Conditional shares
200% of value of gross bonus deferral
£2,450
95,444
25%
8 June 2025
PSP
2
Conditional shares
200% of salary
£1,260
48,786
25%
8 June 2025
Craig Boundy
3
CIP invested shares
Deferred shares
100% of net bonus
£596
23,210
n/a
8 June 2025
CIP matching shares
1
Conditional shares
200% of value of gross bonus deferral
£2,303
89,703
25%
8 June 2025
PSP
2
Conditional shares
200% of salary
US$1,980
61,767
25%
8 June 2025
Kerry Williams
CIP invested shares
Deferred shares
100% of gross bonus
US$2,071
64,995
n/a
8 June 2025
CIP matching shares
1
Conditional shares
200% of value of gross bonus deferral
US$4,142
129,990
25%
8 June 2025
PSP
2
Conditional shares
200% of salary
US$2,129
66,399
25%
8 June 2025
1
The number of shares awarded to executive directors under the CIP was based on the share price at which invested shares were purchased in the market and the face value shown above is based on this.
This price was £25.67.
2
The number of shares awarded to executive directors under the PSP was based on the average share price for the three days prior to grant, which was £25.83, and the face value shown above is based
on this.
3
The number of shares awarded to Craig Boundy was awarded prior to his appointment as a director.
PSP awards and CIP matching shares granted in June 2022 will vest subject to the achievement of the following performance conditions:
Performance measure
Weighting
Vesting
1
0%
25%
50%
100%
CIP matching shares
Benchmark Earnings per share (average annual growth)
2
50%
Below 5%
6%
8%
10%
Cumulative Benchmark operating cash flow
50%
Below US$5.0bn
US$5.0bn
US$5.2bn
US$5.4bn
PSP awards
Benchmark Earnings per share (average annual growth)
2
50%
Below 6%
6%
8%
10%
TSR of Experian vs TSR of FTSE 100 Index
25%
Below Index
Equal to Index
8.3% above Index
25% above Index
Adjusted Return on capital employed (average over three years)
25%
Below 14.5%
14.5%
15.4%
16.0%
1
Straight-line vesting between the points shown.
2
Measured on an ongoing activities and constant currency basis.
The Committee retains the right to vary the level of vesting if it believes the level of vesting determined by measuring performance is inconsistent
with the Group’s underlying financial and operational performance over the performance period. These awards will also only vest if the Committee
is satisfied the vesting is not based on materially misstated financial results.
131
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
How is the CEO’s pay linked to Experian’s performance?
The chart below shows Experian’s annual TSR performance compared to the FTSE 100 Index over the last ten years. The FTSE 100 Index is the most
appropriate index as it is widely used and understood, and Experian is a constituent of the index.
Value of £100 invested in Experian and the FTSE 100 on 31 March 2013
£0
£50
£100
£150
£200
£250
£300
£350
£400
31 March
2013
31 March
2014
31 March
2015
31 March
2016
31 March
2017
31 March
2018
31 March
2019
31 March
2020
31 March
2021
31 March
2023
31 March
2022
Experian
FTSE 100 Index
The table below sets out our CEO’s pay for the last eleven financial years:
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
CEO total single figure
of remuneration (‘000)
1
Don Robert
US$22,974 US$16,290
US$620
—
—
—
—
—
—
—
—
Brian Cassin
—
—
£1,976
£3,678
£3,647
£6,387
£11,882
£10,836
£7,821
£9,938
£7,371
Annual bonus paid against
maximum opportunity (%)
Don Robert
75%
50%
—
—
—
—
—
—
—
—
—
Brian Cassin
—
—
38%
100%
89%
58%
85%
80%
91%
100%
59%
LTIP vesting against
maximum opportunity (%)
2
Don Robert
100%
94%
69%
—
—
—
—
—
—
—
—
Brian Cassin
—
—
40%
33%
32%
95%
90%
90%
84%
100%
88%
1
Prior year numbers have been updated to reflect actual long-term incentive plan outcomes.
2
The maximum LTIP opportunity varies as the CIP opportunity is based upon the actual bonus earned.
CEO pay ratio
Experian follows good corporate governance and transparency in reporting remuneration for our executive directors and employees. We have
presented below the CEO pay ratio for the year ended 31 March 2023, in line with the UK regulatory requirements. The pay ratios have been calculated
using Option A of the three methodologies provided under the regulations, which we believe is the most statistically accurate approach.
Year
Method
25th percentile
pay ratio
Median
pay ratio
75th percentile
pay ratio
Option A
267:1
178:1
112:1
2020
Total pay and benefits
£38,630
£57,803
£91,736
Salary
£33,362
£47,869
£77,000
Option A
185:1
124:1
81:1
2021
Total pay and benefits
£40,969
£61,115
£93,574
Salary
£32,569
£49,983
£75,000
Option A
226:1
155:1
101:1
2022
Total pay and benefits
£43,957
£64,062
£98,754
Salary
£35,467
£50,333
£66,458
Option A
142:1
97:1
65:1
2023
Total pay and benefits
£51,978
£75,887
£112,982
Salary
£46,778
£62,667
£85,846
Annual report on directors’ remuneration
continued
Experian plc
Governance
132
Code principle
Remuneration
The CEO value used is the total single figure remuneration data for FY23 of £7.4m, as outlined on page 127. For UK employees, total pay and benefits
are based on actual earnings for the year to 31 March 2023. Annual incentive payments for employees have been calculated using the Experian Group
financial performance outcome for FY23, as disclosed on page 129, rather than any regional or market business performance results, to ensure a
like-for-like comparison across remuneration structures. Selected employee grades below senior leaders level are also eligible for annual awards of
restricted stock, rather than the performance share awards provided to senior leaders. Where applicable, the LTI value for employees has been
calculated by applying the average share price for the three months prior to 31 March 2023 to the number of restricted stock awards granted to the
employee in June 2020. We adopted this approach to provide a like-for-like comparison and ensure the share price growth over the previous three
years is reflected equally in both the CEO and employee LTI values. Employees on inbound and outbound international assignments to and from the
UK have been excluded from the analysis as their remuneration structures understandably deviate from the standard approach for UK employees.
In line with the guidance, only individuals employed for the full year have been included in the analysis.
Observations on change in CEO pay ratio
The CEO voluntarily waived 25% of his salary for six months in FY21, resulting in a significantly lower salary than in a ‘normal’ year. The FY23 CEO
single figure has decreased by c.26% compared to FY22. By comparison, the total pay and benefits provided to UK employees in FY23 increased. As a
result, the FY23 CEO pay ratios for all percentiles are lower than FY22, but importantly are significantly lower than for FY20 which, as a more typical
performance year, is arguably a more appropriate comparison for change.
The primary reason for the lower FY23 CEO pay ratio is the value of the LTI received by the CEO in FY23. As outlined earlier in the Report, the
Committee did not exercise any discretion, nor make any adjustments, in determining the vesting outcomes for either the 2019 or 2020 LTI awards.
While the FY23 performance was very resilient, and resulted in strong LTI vesting outturns, the performance was not as strong as FY22 and this has
resulted in a lower FY23 single figure value. By way of comparison, the total pay and benefit amounts received by UK employees in FY23 are higher
than in FY22 due to the introduction of additional benefit policies in FY23, including increased bonus opportunities for UK employees in response to
employee feedback gathered as part of the UK Total Reward Optimisation project.
The Committee believes it is appropriate that a significant proportion of total remuneration for executive directors is ‘at risk’ and based entirely on
Group performance, which is within their power to influence. In line with our remuneration principles, the proportion of total compensation that is ‘at
risk’ increases with employee seniority within the Group. The remuneration framework is designed to offer market-competitive total compensation.
All UK employees participate in a variable pay plan. We have one annual bonus plan in operation across Experian and the majority (c.16,000) of our
workforce participate in this plan, providing them with the opportunity to benefit from the financial performance they help achieve.
Understandably, more of the CEO’s total target remuneration (71%) is ‘at risk’ compared to c.8% on average for UK-based employees. As evidenced in
both FY23 and FY22, the CEO pay ratio is therefore likely to vary over time, potentially significantly, based on the Group’s performance outcomes.
Observations on FY23 pay ratio
The median pay ratio for FY23 of 97:1 reflects not only the strong performance achieved in FY23, but also the resilient performance achieved in the
preceding two financial years, which are reflected in the CEO’s LTI vesting values. As LTI values can be highly variable, in part due to fluctuations in
share price, a supplemental pay ratio has been provided below, where the value of LTIs has been excluded. The CEO single figure value excluding
LTI compensation was £2.4m for FY23.
Year
Method
25th percentile
pay ratio
Median
pay ratio
75th percentile
pay ratio
FY20
Option A excluding long-term incentives
71:1
47:1
30:1
FY21
Option A excluding long-term incentives
69:1
47:1
30:1
FY22
Option A excluding long-term incentives
73:1
50:1
32:1
FY23
Option A excluding long-term incentives
47:1
32:1
21:1
Some important additional context regarding our FY23 CEO pay ratio includes the following:
a
We have a rigorous approach to salary management that is underpinned by regular market benchmarking to ensure we offer competitive rates of
pay across the business. We undertake regular reviews to maintain appropriate positioning with external market-linked salary ranges.
a
Experian has been a Living Wage employer in the UK since 2015, and the median salary for our UK employees (as reflected in the table on the
previous page) is more than 50% above the UK average.
a
The Committee always has the context of the all-employee pay review budget when determining salary increases for the CEO, and ensures any
percentage increase for the CEO does not exceed that provided to employees. In FY23, the average increase for the UK employee base pay was 4%
and a 2.5% increase was provided to the CEO. For FY24, the UK salary review budget is 3%, while the CEO’s salary will increase by 2.5%.
a
An ‘individual performance modifier’ is also applied in calculating the annual bonus payments for employees, to ensure the outstanding
contribution of high-performing individuals is reflected through higher bonus payments. Individual performance modifiers do not apply to senior
management, including the CEO. As such, to ensure a like-for-like comparison with the CEO single figure, the employee calculations, as outlined on
the previous page, do not reflect the impact of individual performance modifiers, which would have considerably increased the annual bonus
payments for employees and reduced the CEO pay ratio accordingly.
a
We have not included the value of our Sharesave scheme in the all-employee values on the previous page. We firmly believe in the value of
employee share ownership and encourage employees to participate in our Sharesave offering, which is a tax-efficient plan in the UK and allows
employees to share in Experian’s growth and success. Around 75% of UK employees participate in Sharesave and the average profit received by
UK employees at maturity in FY23 was £2,365, but this value has not been included in the all-employee values on page 134.
133
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
How has our Board of directors' pay changed compared to the wider workforce?
The table below sets out the percentage change in the Board of directors' salaries/fees, benefits and annual bonus between FY21, FY22 and FY23,
and how this compares to the average percentage change for our UK employees. While the Regulations require the employee comparison against
employees of Experian plc, the proportion of our workforce employed by Experian plc is comparatively very small. We have therefore elected, as in
previous years to provide the comparison with our UK employees, which we believe provides an appropriately representative analysis. We have
selected this group of employees because Experian operates in 32 countries and, as such, has widely varying approaches to pay across different
regions. This approach also avoids the complexities involved in collating and comparing remuneration data across different regional populations,
including the impact of foreign exchange rate movements. The figures for UK employees are consistent with the information used to prepare the CEO
pay ratio analysis, but reflect average salaries and average employee numbers each year, rather than percentile data. For the CEO, the annual bonus
is based on Group performance. As previously disclosed, in FY21 the executive directors each waived 25% of their salaries for six months and this is
behind the year-on-year base salary change for Brian Cassin, Lloyd Pitchford and Kerry Williams.
Year-on-year change in pay for directors compared to the average UK employee
Average
employee
Executive directors
Independent
Chair
Non-executive directors
Brian
Cassin
Lloyd
Pitchford
Kerry
Williams
Mike
Rogers
Dr Ruba
Borno
Alison
Brittain
3
Kathleen
DeRose
Caroline
Donahue
Luiz
Fleury
Jonathan
Howell
3
Esther
Lee
Deirdre
Mahlan
Louise
Pentland
George
Rose
Base salary change
FY23
7.6%
2.5%
2.4%
(68.8)%
2.7%
(6)%
2
47%
n/a
17%
16%
39%
n/a
(62)%
2
n/a (70)%
2
FY22
6.1%
16%
17%
17%
2%
5%
9%
n/a
5%
13%
n/a
n/a
4%
n/a
6%
FY21
2.6%
(12)%
(12)%
(12)%
21%
(11)%
n/a
n/a
(14)%
(11)%
n/a
n/a
(11)%
n/a
0%
Taxable benefits
FY23
27.2%
5.7%
(64)%
(91)%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
FY22
8.7%
6%
155%
1
(3)%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
FY21
7.1%
1%
3%
3%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Annual bonus
FY23
(21.9)%
(40)%
(40)%
(40)%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
FY22
32.2%
12%
12%
12%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
FY21
27.5%
15%
15%
15%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
1
The increase in taxable benefits for Lloyd Pitchford is entirely attributable to the value of his SAYE options which vested in FY22.
2
Dr Ruba Borna, Deirdre Mahlan and George Rose all stepped down from the Board in FY23 and therefore their fees earned in FY23 compared to FY22 are lower.
3
Alison Brittain's increase reflects additional responsibilities as Senior Independent Director. Jonathan Howell became Chair of the Audit Committee.
How do we intend to implement the remuneration policy next year?
Salary
The table below outlines the salary increases that will take effect from 1 June 2023 for each executive director. The employee salary review budget
for FY24 is 3% for our employees both in the USA and the UK.
1 June 2023
‘000
1 June 2022
‘000
%
increase
Brian Cassin
£1,045
£1,020
2,5%
Lloyd Pitchford
£646
£630
2.5%
Craig Boundy
US$1,025
US$1,000
2.5%
Annual bonus
For the year ending 31 March 2024, the annual bonus opportunity and the performance measures the executive directors are assessed on will remain
unchanged from FY23.
In line with our policy, we will disclose the targets for the annual bonus in next year’s Annual report on directors’ remuneration. While the FY24 annual
bonus targets cannot be disclosed due to their commercial sensitivity, they reflect our resilience in the face of the challenging outlook for the year
ahead. Annual bonus will be subject to clawback provisions, allowing the Group to recover all or part of any payment for a period of three years from
payment. In addition, the Committee can vary the level of payout if it considers that the formulaic payout determined by measuring performance is
inconsistent with the Group’s actual underlying financial and operational performance.
Performance is measured on a constant currency basis to strip out the effects of exchange rate fluctuations, which are outside of management’s
control. The Committee also excludes the impact of any material acquisitions or disposals made in the year to ensure both metrics are measured
consistently, which is in line with our approach to long-term incentive plan measures.
Annual report on directors’ remuneration
continued
Experian plc
Governance
134
Code principle
Remuneration
Share-based incentives
While deferral of 50% is compulsory, the executive directors have each elected to defer the full 100% of their FY23 bonuses into the CIP. We expect to
grant matching shares in the first quarter of the year ending 31 March 2024, on a two-for-one basis. We also expect to grant PSP awards equivalent to
200% of salary at the same time. The CIP and PSP awards will vest subject to meeting the following targets, which will be measured over three years,
with a further two-year holding period applying:
Performance measure
Weighting
Vesting
1
0%
25%
50%
100%
CIP awards
Benchmark Earnings per share (average annual growth)
2
50%
Below 5%
5%
7%
9%
Cumulative Benchmark operating cash flow
50%
Below US$5.5bn
US$5.5bn
US$5.75bn
US$6.0bn
PSP awards
Benchmark Earnings per share (average annual growth)
2
50%
Below 5%
5%
7%
9%
Adjusted Return on capital employed
25%
Below 14.5%
14.5%
15.4%
16.0%
TSR of Experian vs TSR of FTSE 100 Index
25%
Below Index
Equal to Index
8.3% above Index
25% above Index
1
Straight-line vesting between the points shown.
2
Measured on an ongoing activities and constant currency basis.
The Committee selected adjusted Benchmark EPS, cumulative Benchmark operating cash flow and adjusted ROCE as performance metrics for our
long-term incentive plans, as they reflect three of our key performance indicators. As such, using these measures directly links Experian’s long-term
incentive arrangements to our strategic ambitions and business objectives. In addition, using relative TSR recognises the importance of creating value
for shareholders. We believe these measures to be the most appropriate measures of the Group’s success and, together with our annual bonus
measures, they ensure that executive directors are incentivised to achieve a wide range of business and financial measures over both the short and
long term. The structure differentiates the role of each of our long-term incentive plans: the PSP incentivises returns and the CIP incentivises cash
discipline. However, given that growth is so fundamental to our business strategy, growth in Benchmark EPS runs across both of the long-term
incentive plans.
Vesting of CIP and PSP awards will be subject to the Committee being satisfied that the vesting is not based on materially misstated financial results.
The Committee also retains the discretion to vary the level of vesting if it considers the level of vesting determined by measuring performance is
inconsistent with the Group’s underlying financial and operational performance. These awards will all be subject to clawback provisions, allowing the
Company to recover all or part of any vested award during the holding period.
TSR performance
We measure our TSR performance relative to the FTSE 100 Index, rather than to a bespoke comparator group. Our usual comparator companies are
Bread Financial, CoreLogic, Dun & Bradstreet, Equifax, FICO, LiveRamp, Moody’s, RELX, Thomson Reuters and TransUnion. However, we believe it
would be difficult to compare our TSR performance with them on a consistent basis, since many of them are listed in different markets and, as such,
may be subject to different market forces. Nevertheless, the Committee uses them as a reference point when reviewing other aspects of executive
director pay.
Additional disclosures
Directors’ shareholdings and share interests (audited)
We believe it is important that executive directors build up a significant holding in Experian shares, to align their interests with those of shareholders.
Under our guidelines, the CEO should hold the equivalent of at least three times his or her base salary in Experian shares and other executive directors
should hold the equivalent of at least two times their base salary. These guidelines include invested or deferred shares held under the CIP, but not
unvested matching shares. Shares that have vested but are subject to the two-year holding period will also count towards the guideline. Until the
shareholding guideline is met, we expect executive directors to retain at least 50% of any shares vesting (net of tax) under a share award. Unvested shares
do not count towards the guideline.
We also have guidelines for non-executive directors to build up a holding in Experian’s shares at least equal to their annual fee. Each financial year, the net
fee for the first quarter is used to purchase Experian shares until the non-executive director reaches this holding.
As set out in the table below, our executive directors already significantly exceed their personal shareholding guidelines, demonstrating their alignment
to shareholder interests as well as their commitment to Experian. To further strengthen this alignment post-employment, the Remuneration Committee
introduced a two-year post-employment shareholding guideline as part of the 2020 Policy review.
135
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
All executive directors who served during the year hold shares in excess of the relevant shareholding guidelines. The interests of the directors
(at 31 March 2023) and their connected persons in the Company’s ordinary shares (as at 31 March 2023) are shown below and, for those individuals
in the following table, there have been no changes between 31 March 2023 and the date of this report:
Shares held in
Experian plc at
31 March 2023
Shareholding guidelines
Share awards subject to
performance conditions
Share options
4
Guideline
1
(% of salary/fee)
Shareholding
(% of salary/fee)
2
Guideline met?
CIP matching
awards
3
PSP awards
Brian Cassin
5
725,898
300%
1893%
Yes
400,802
224,153
—
Lloyd Pitchford
5
403,725
200%
1705%
Yes
247,435
138,432
726
Craig Boundy
5
215,487
200%
710%
Yes
250,578
135,493
—
Mike Rogers
15,287
100%
94%
No
—
—
—
Alison Brittain
7,500
100%
83%
No
—
—
—
Kathleen DeRose
2,300
100%
41%
No
—
—
—
Caroline Donahue
10,000
100%
177%
Yes
—
—
—
Luiz Fleury
9,650
100%
171%
Yes
—
—
—
Jonathan Howell
8,000
100%
109%
Yes
—
—
—
Esther Lee
0
100%
0%
No
—
—
—
Louise Pentland
0
100%
0%
No
—
—
—
1
Executive director shareholding guideline will apply for two years post-employment.
2
Shareholding guidelines have been calculated using the closing share price on 31 March 2023, which was £26.60 and exchange rates at 31 March 2023 of £1:US$1.239 and £1:€1.137.
3
Matching shares granted to Brian Cassin, Lloyd Pitchford and Craig Boundy are in the form of conditional shares, which are unvested at 31 March 2023.
4
Share options granted under the 2022 all-employee Sharesave plan.
5
The number of Experian shares held by Brian Cassin, Lloyd Pitchford and Craig Boundy at 31 March 2023 includes 105,247, 64,973 and 65,842 invested shares in the CIP respectively.
Payments made to former directors (audited)
Three former directors of Experian Finance plc (formerly GUS plc) received unfunded pensions from the Group. One of the former directors is now
paid under the Secured Unfunded Retirement Benefit Scheme, which provides security for the unfunded pensions of executives affected by the
His Majesty’s Revenue and Customs (HMRC) earnings cap. The total unfunded pensions paid to the former directors amounted to £814,000 in the year
ended 31 March 2023. As previously disclosed, Kerry Williams stepped down from the Board at last year’s AGM on 21 July 2022 but continued to work
for the Group before retiring on 31 March 2023. He continued to receive his salary (US$1,075,000) and other contractual benefits during this time and
remained incentive eligible until his final day of employment as is our standard practice. He did not receive any additional or exceptional payments
as part of his leaving (retirement) arrangements.
Payments for loss of office (audited)
No payments for loss of office were made in the year (2022: US$nil).
Relative importance of spend on pay
The table below illustrates the relative importance of spend on pay for all employees, compared to the financial distributions to shareholders, through
dividends and net share repurchases:
2023
US$m
2022
US$m
% change
Employee remuneration costs
2,381
2,313
3%
Dividends paid on ordinary shares
482
444
9%
Net share repurchases
1
51
—
100%
1
We executed net share repurchases for a cash consideration of US$175m, of which US$124m offset deliveries during the year under employee share plans. The remainder may be used for employee share
plans in future years.
Annual report on directors’ remuneration
continued
Experian plc
Governance
136
Code principle
Remuneration
The Remuneration Committee
All our non-executive directors are members of the Committee, which met four times during the year ended 31 March 2023. Each member
is considered to be independent in accordance with the UK Corporate Governance Code.
You can find the Committee’s terms of reference via the QR code on page 121.
The Committee’s role and responsibilities
The Committee is responsible for:
Committee activities
During the year, the Committee:
a
Reviewed and approved the 2022 Report on directors’ remuneration.
a
Reviewed salaries of certain Group Operating Committee members and approved any annual pay adjustments for those Group Operating
Committee members in FY23.
a
Agreed the FY22 incentive plan outcomes, the FY23 bonus targets, and the long-term incentive plan participants.
a
Received updates on the Company’s long-term incentive plans.
a
Discussed at length executive pay in the context of the wider workforce and the broader impact on society, the Group, and our shareholders.
a
Was updated on all-employee pay and workforce policies across Experian, including detailed insights on all-employee pay, workforce policies and
gender pay gap analyses in North America and Brazil, two of our key markets.
a
Was updated on current trends in the executive remuneration environment, focusing on our major regions.
a
Was updated on the Company’s FY23 UK gender pay gap disclosure requirement. The Committee had a robust discussion regarding the results and
was provided with additional detailed analysis on Experian’s gender pay position.
a
Was updated on the Company’s response to the CEO pay ratio UK disclosure requirement and reviewed the relevant disclosures.
a
Initiated the invitation to employees to participate in the 2022 Sharesave plan and was updated on take-up rates and outcomes of previous grants.
a
Was provided with an update on strategic projects designed to enable Experian to attract and retain key tech talent in an increasingly competitive
market. The Committee was provided with an overview of the reward changes proposed as part of this work.
a
Reviewed the Committee’s performance during the year against its terms of reference.
a
Chair attended the UK and Ireland Experian People Forum in March 2023, to engage with employees, discuss how Experian’s executive
remuneration aligns with the wider Group pay policy, and understand employees’ views on culture, ways of working as well as pay-related issues.
This feedback was provided to the Board thereafter.
a
Chair wrote to major shareholders and the proxy advisory bodies to maintain the existing engagement levels and to offer the opportunity to discuss
any topics of interest. Chair subsequently met with everyone who wished to avail of that opportunity. The themes and discussion points of those
meetings were provided to the Board thereafter.
Advice provided to the Committee
In making its decisions, the Committee consults the Chair, the Chief Executive Officer and the Chief People Officer where required.
We also invite members of the Global Reward team to attend Committee meetings as appropriate. We normally consult the Chief Financial Officer
about performance conditions applying to short- and long-term incentive arrangements, to ensure they are appropriately financially stretching.
However, we do not consider it appropriate that executives are present when their own remuneration arrangements are being discussed.
The Committee has access to independent consultants to ensure it receives objective advice. We reviewed our external advisers in 2013 and
appointed Towers Watson Ltd (Willis Towers Watson), who remained our external advisers throughout the year ended 31 March 2023. Willis Towers
Watson provides other services to Experian globally, including advice on benefits and provision of market data.
Additionally, Ellason LLP (Ellason) provided incentive plan award valuations and remuneration data, as well as supporting data for the target
calibration process. Ellason does not provide any other services to the Group.
Willis Towers Watson and Ellason are members of the Remuneration Consultants Group and voluntarily operate under the Code of Conduct in relation
to executive remuneration consulting in the UK. The Committee was satisfied that their advice was objective and independent.
The fees paid to these advisers for services to the Committee in the year ended 31 March 2023, based on hours spent, were as follows:
Adviser
Fees paid in the year
Willis Towers Watson
£22,700
Ellason
£13,650
1
Recommending
to the Board
senior executive
remuneration policy
and the Chair’s
remuneration.
2
Determining
individual
remuneration
packages for
executive directors
and certain senior
executives.
3
Communicating
with shareholders
on remuneration
policy.
4
5
Overseeing
the Group’s
executive pension
arrangements.
6
Overseeing
broader employee
workforce policies.
Making
recommendations
to the Board on
the design of the
Group’s short-
and long-term
incentive plans.
137
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
What did we pay our non-executive directors during the year? (audited)
The table below shows a single total figure of remuneration for the Chair and non-executive directors for the years ended 31 March 2023 and
31 March 2022:
Fees ‘000
Benefits ‘000
Share-based incentives ‘000
Total ‘000
5
2023
2022
2023
2022
2023
2022
2023
2022
Mike Rogers
1
€488
€475
—
—
—
—
€488
€475
Dr Ruba Borno (retired on 31 January 2023)
€156
€166
—
—
—
—
€156
€166
Alison Brittain
2
€253
€172
—
—
—
—
€253
€172
Kathleen DeRose (appointed 1 November 2022)
€81
—
—
—
—
—
€81
—
Caroline Donahue
€194
€166
—
—
—
—
€194
€166
Luiz Fleury
3
€276
€238
—
—
—
—
€276
€238
Jonathan Howell
4
€220
€159
—
—
—
—
€220
€159
Esther Lee (appointed 31 March 2023)
—
—
—
—
—
—
—
—
Deirdre Mahlan (retired on 1 July 2022)
€81
€215
—
—
—
—
€81
€215
Louise Pentland (appointed 1 November 2022)
€81
—
—
—
—
—
€81
—
George Rose (retired on 21 July 2022)
€81
€269
—
—
—
—
€81
€269
1
Mike Rogers was appointed Chair of the Board on 24 July 2019. On appointment his Chair fee was set at €465,000. On 1 June 2021 this was increased by 2.5% to €477,000, and on 1 June 2022 the fee was
increased by 2.7% to €490,000.
2
Alison Brittain was appointed as Senior Independent Director and Remuneration Committee Chair on 21 July 2022.
3
Luiz Fleury acted as an independent adviser to Serasa S.A., our Brazilian business. His remuneration includes a fee for this role, paid in Brazilian reais, along with the annual non-executive director’s fee.
4
Jonathan Howell was appointed Audit Committee Chair on 1 July 2022.
5
For FY23, the cumulative total single figure of remuneration for the Chair and non-executive directors in US$, applying the average exchange rate over the year of €1:US$1.0411 (2022: €1:US$1.1624) is
US$2.0m (2022: US$2.2m).
Non-executive director fees are reviewed annually and were last reviewed in 2022. The current fee levels are as follows:
Annual fee from
1 October 2022
Annual fee prior to
1 October 2022
Base fee
€170,500
€162,250
Audit Committee Chair fee
€51,500
€49,000
Remuneration Committee Chair fee
€42,000
€39,750
Deputy Chair/Senior Independent Director fee
€103,000
€98,000
Non-executive directors required to undertake intercontinental travel to attend Board meetings receive a supplementary payment of €10,000 per trip,
in addition to any travel expenses. This amount changed from 1 October 2022, having not previously changed from €6,000 since October 2009.
Alison Brittain holds the role of Chair of the Remuneration Committee, in addition to her role as Senior Independent Director. She does not receive an
additional fee for her role as Chair of the Remuneration Committee.
Statement of voting at the 2022 AGM
The voting to approve the annual report on directors' remuneration at the AGM held on 21 July 2022, and the Directors’ remuneration policy approved
at the AGM held on 22 July 2020, is set out in the following table:
Votes for
(including
discretionary
votes)
%
Number
Votes against
%
Number
Total number
of votes cast
Number of
votes withheld
Annual report on directors’ remuneration
95.7%
4.3%
647,529,103
29,342,951
676,872,054
22,827,856
Directors’ remuneration policy
95.3%
4.7%
651,717,394
31,847,208
683,564,602
15,168,573
Annual report on directors’ remuneration
continued
Experian plc
Governance
138
Code principle
Remuneration
Service contracts
Non-executive directors have letters of appointment that set out their duties and time commitment expected. They are appointed for an initial
three-year term, subject to election and annual re-election by shareholders at the AGM. Appointments are renewed by mutual agreement. Details of
non-executive director arrangements as at 31 March 2023 are set out below:
Name
Date of appointment
Length of service at 31 March 2023
Years
Months
Mike Rogers (appointed Chair on 24 July 2019)
1 July 2017
5
9
Alison Brittain
1 September 2020
2
7
Kathleen DeRose
1 November 2022
—
5
Caroline Donahue
1 January 2017
6
3
Luiz Fleury
8 September 2015
7
7
Jonathan Howell
1 May 2021
1
11
Esther Lee
31 March 2023
—
—
Louise Pentland
1 November 2022
—
5
Executive directors’ service contracts contain a 12-month Company notice period, as set out in the Directors’ remuneration policy. Brian Cassin was
appointed to the Board on 30 April 2012 as Chief Financial Officer, and 16 July 2014 as Chief Executive Officer. The date of appointment to the Board for
Lloyd Pitchford was 1 October 2014, and for Craig Boundy 21 July 2022.
139
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
The Directors’ remuneration policy was last approved by shareholders at the AGM on 22 July 2020. Shareholder approval will be sought at the 2023
AGM for the Policy as set out below.
The 2023 Policy table below includes the changes already made and supported by shareholders in the last three years. The most recent change was
to introduce the pension provision alignment for UK-based executive directors. This change was signalled to shareholders well in advance of its
introduction. From 1 January 2023, the pension provision for UK-based executive directors was aligned to the pension provision for the majority of the
UK employee workforce. Alongside the Policy table, we have also included the Which clawback provisions apply? section, which we consider to be the
most helpful sections of the Policy for investors. No other changes are being made to the policy.
The full and original version of the Policy, as approved by shareholders, is available on the Experian corporate website via
www.experianplc.com/
investors/reports
.
Element and link to strategy
Operation
Maximum potential value
and payment at target
Performance metrics
and weightings
Base salary
To help with attracting and
retaining executive directors
of the right calibre.
Provides a base level of pay
and reflects the competitive
market salary for the role.
Base salary level takes
account of personal
contribution and
performance against
Group strategy.
Base salary is paid in equal instalments during the year.
Salaries are reviewed annually, with any increases
generally taking effect from 1 June.
Salary levels and increases take into account a
number of factors, including the approach to employee
remuneration throughout the Group, prevailing
economic conditions, best practice and positioning
against the market.
Annual executive director salary
increases will, in normal
circumstances, be limited to the
increases awarded across the
Group as a whole.
Higher increases may be made in
exceptional circumstances including,
but not limited to, a change in role or
responsibility, and will take account
of market practice in relation to the
new role.
When the Committee considers
salary increases, it takes into
account individual performance
over the preceding financial year.
Benefits
Provides part of a
competitive and
cost-effective overall
remuneration package.
Certain benefits may also
be provided to support
expatriates, where they
have relocated.
The Group provides a range of market-competitive
benefits that include, but are not limited to, healthcare,
financial and tax advice, death-in-service provision and
company car or allowance.
Executive directors can also participate in any of the
Group’s all-employee share plans, for example the
Sharesave plan, on the same basis as other eligible
employees.
In the USA, eligible executive directors may participate
in a deferred compensation plan, which is standard
market practice in the USA.
For expatriate assignments, we retain the flexibility to
tailor benefits to the circumstances of the assignment.
Additional benefits may include relocation expenses at
the beginning and end of each assignment, housing
allowance and school fees.
The cost of providing such benefits
may vary from year to year, reflecting
the cost to the Group.
The Committee sets benefits at a level
it considers appropriate against
relevant market practice, the role and
particular circumstances (for example,
in the case of expatriate benefits,
where the individual is required to
relocate).
None.
Pension
Provides a market-aligned
retirement provision.
Pension arrangements are in line with local
market practice.
In the UK, the Group operates a defined contribution
plan, with company contributions set as a percentage
of base salary. If impacted by His Majesty’s Revenue
and Customs (HMRC) pension limits, an individual
may elect to receive a cash allowance instead.
In the USA, executive directors are eligible to join
a defined contribution plan.
In the UK, the cash payment or pension
contribution for executive directors is
normally equal to 10% of annual gross
base salary, which aligns to the wider
UK employee workforce.
In the USA, the contribution rate is up
to 4% of earnings, up to an annual
compensation limit set by the US
Internal Revenue Service.
If required, pension arrangements
in other jurisdictions would be in line
with local market practice.
None.
Directors’ remuneration policy
Experian plc
Governance
140
Code principle
Remuneration
Element and link to strategy
Operation
Maximum potential value
and payment at target
Performance metrics
and weightings
Annual bonus
Motivates and rewards the
achievement of specific
annual objectives, linked
to Experian’s business
strategy.
The Committee sets appropriate performance targets
at the start of each financial year.
At the end of the financial year, the Committee
determines the extent to which these have been
satisfied, based on audited results, and agrees the
level of bonus to be paid.
Half of any bonus must be deferred for a period of
three years. However, the executive director may elect
to defer up to 100% of their bonus into the CIP. Where
they elect not to do so, payment is made as soon as
practicable after the financial year end.
Malus and clawback provisions apply, under which
annual bonus payments may be reduced or recovered
in certain circumstances. Further details about our
clawback and malus policy are set out in the Which
clawback provisions apply? section of the report.
Threshold performance results in
a bonus payout equivalent to 25%
of the maximum. No bonus is payable
for below-threshold performance.
Achieving target performance results
in a bonus payout equivalent to 50%
of the maximum.
Achieving maximum performance
results in a full bonus payout of
200% of salary.
The annual bonus may be based
entirely on financial performance
or on a combination of financial,
strategic and/or operational
objectives.
However, the financial element
will comprise at least 70% of the
bonus.
The Committee retains the ability
to exercise its judgment to vary
the level of payout if it considers
that the formulaic payout
determined by measuring
performance is inconsistent with
the Group’s actual underlying
financial and operational
performance.
Co-investment Plans
Aligns with shareholder
interests through voluntary
investment of personal
capital, delivery of Experian
shares and the long-term
time horizons.
Use of stretch financial
metrics incentivises
performance.
Encourages participants’
long-term commitment
to the Group through
personal investment.
Participants are invited to invest between 50% and
100% of their annual bonus into Experian shares.
A conditional award of matching shares or nil-cost
options is granted on a two-for-one basis on the gross
bonus deferred, and vests after three years subject to
achieving performance targets over the three-year
period. Any vested awards are subject to a further
two-year holding period.
Dividend equivalents accrue on all awards of shares.
Malus and clawback provisions apply, under which
CIP awards may be reduced or recovered in certain
circumstances. Further details about our malus and
clawback policy are set out in the Which clawback
provisions apply? section of the report.
Maximum award levels depend on
the bonus deferred, which will be
matched on up to a two-for-one basis.
There is no vesting for below-
threshold performance.
Achieving threshold performance
results in 25% vesting of the matching
shares.
Achieving target performance results
in 50% vesting of the matching shares.
Achieving maximum performance
results in full vesting of the matching
shares.
Awards vest based on financial
performance and subject to the
Committee being satisfied that the
vesting is not based on materially
misstated financial results.
The Committee retains the
discretion to exercise its judgment
to vary the level of vesting if it
considers the formulaic vesting
level determined by measuring
performance to be inconsistent
with the Group’s actual underlying
financial and operational
performance.
Performance Share Plan
Use of stretch financial
metrics incentivises
performance.
Aligns with shareholder
interests through delivery
of shares and the
long-term time horizons.
Participants receive an annual award of conditional
shares or nil-cost options, which vest after three years,
subject to achieving performance targets over the
three-year period. Any vested awards are subject to
a further two-year holding period.
Dividend equivalents accrue on all awards of shares.
Malus and clawback provisions apply, under which
PSP awards may be reduced or recovered in certain
circumstances. Further details about our malus
and clawback policy are set out in the Which clawback
provisions apply? section of the report.
Normal maximum award levels are
200% of salary.
Awards of up to 400% of salary may
be made in exceptional circumstances
such as recruitment.
There is no vesting for below-
threshold performance.
Achieving threshold performance
results in 25% of the shares vesting.
Achieving maximum performance
results in full vesting of the shares.
Vesting of up to 25% of the awards
is based on a share-based metric,
with the balance based on
financial performance.
The Committee retains the ability
to vary the level of vesting if it
considers the formulaic vesting
level determined by measuring
performance to be inconsistent
with the Group’s actual underlying
financial and operational
performance.
141
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
Element and link to strategy
Operation
Maximum potential value
and payment at target
Performance metrics
and weightings
Shareholding guideline
To preserve and enhance
the long-term alignment of
the interests of executive
directors with shareholders
and promote a long-term
approach to performance
and risk management.
During employment:
Executive directors are required to establish and
maintain a minimum personal shareholding equal in
value to 3x base salary for the CEO and 2x base salary
for other executive directors.
Executive directors are required to retain at least 50% of
any shares vesting under the CIP and PSP (net of tax)
until their during-employment shareholding guideline
has been met.
Shares held beneficially, shares subject to a
post-vesting holding period and invested or deferred CIP
shares will count when assessing the guideline. Share
awards that are still subject to performance conditions
and matching shares under the CIP are not included.
Post-employment:
For two years following cessation, (former) executive
directors are required to retain the lower of:
a
their actual shareholding immediately prior
to cessation; and
a
their shareholding guideline immediately prior
to cessation.
In determining the actual shareholding at cessation,
shares acquired from own purchases will not be
counted.
N/A
N/A
Independent Chair and non-executive director (NED) fees
To attract individuals with a
broad range of experience
and skills, to oversee the
implementation of our
strategy.
The Chair is paid an annual fee in equal instalments.
The Group may provide the Chair with a limited range
of benefits such as healthcare, tax advice or use of a
car.
The NEDs are paid a basic fee plus additional fees for
chairing a Board Committee and for the role of Deputy
Chair or Senior Independent Director. NED fees are
paid in equal quarterly instalments during the year.
The net fee for the first quarter of the financial year is
used to purchase Experian shares for NEDs and/or the
Chair (as applicable), until the individual has met their
shareholding guideline of 1x their estimated annual fee
(excluding travel fees).
NEDs receive an additional fee where attendance at
Board meetings involves intercontinental travel from
their home location. The Company may settle any tax
due on travel expenses incurred by the Chair and NEDs.
The Committee sets the Chair’s
fees, while NED fees are set by
the Board. Both are set based on a
number of factors, including the time
commitment required and positioning
against the market.
Fees are normally reviewed every
two years.
No performance-related
arrangements are in place
for the Chair or the NEDs.
Share Option Plan (SOP)
Provides focus on
increasing Experian’s
share price over the
medium to longer term.
Options are granted with an exercise price equivalent
to the market value of an Experian share at the date
of grant. These vest subject to achieving performance
targets that are tested over a three-year period and
are exercisable for seven years thereafter.
No option grants have been made since 2009 and the
Committee has agreed that no further awards will be
made, unless warranted by exceptional circumstances
such as recruitment.
Malus and clawback provisions apply, under which
SOP awards may be reduced or recovered in certain
circumstances. Further details about our clawback
and malus policy are set out in the Which clawback
provisions apply? section of the report.
Normal maximum award levels are
200% of salary.
Grants of up to 400% of salary may be
made in exceptional circumstances
such as on recruitment.
There is no vesting for below-threshold
performance.
Achieving threshold performance
results in 25% of the options vesting.
Achieving maximum performance
results in full vesting of the options.
The vesting of options is based on
financial performance targets.
Directors’ remuneration policy
continued
Experian plc
Governance
142
Code principle
Remuneration
Which clawback provisions apply?
Clawback or malus applies to the Company’s incentive plans for five years from grant.
Under these provisions, the Committee may apply malus or clawback in circumstances that have:
a
resulted in a level of vesting or payment that is higher than would otherwise have been, because of a material misstatement of the Group’s financial
results; or
a
led to a material financial or reputational loss for the Group, due to serious individual misconduct.
Under our malus and clawback policy, should a trigger event be identified, a Clawback Committee would be appointed by the Remuneration
Committee to investigate the issue. The Clawback Committee would report back with recommendations on whether malus or clawback should
be applied, which individuals this should affect, which remuneration should be subject to malus or clawback and the value that should be affected.
The Remuneration Committee would then have final sign-off on any decision to operate malus or clawback.
Legacy arrangements
The Committee reserves the right to make any remuneration payments and payments for loss of office (including exercising any discretions available
to it in connection with such payments), notwithstanding that they are not in line with the policy set out in this report where the entitlement to the
payment arose (i) before the 2023 AGM; (ii) at a time when the relevant individual was not a director of the Company and, in the opinion of the
Committee, the payment was not in consideration for the individual becoming a director of the Company; or (iii) under a remuneration policy previously
approved by the Company’s shareholders. For these purposes, entitlements arising under the Company’s previous remuneration policy (as approved
by shareholders at the 2020 AGM) will be incorporated into this policy and ‘payments’ includes the Committee satisfying awards of variable
remuneration, and an entitlement under an award over shares arises at the time the award is granted.
How does our executive remuneration align with the pay of employees across the Group?
Salary
The salary review date for executive directors aligns with the salary review date for all our employees: 1 June each year.
Executive director increases are aligned with typical increases awarded across the Group, under normal circumstances.
Benefits and pension
Benefits and pension arrangements are determined based on local market practice for all of our employees across the
Group, including executive directors. From 2023 we have aligned the employer pension contributions for UK-based executive
directors with those provided to the wider UK workforce. Our US executive director’s pension contribution is currently aligned,
and will continue to be, with the US workforce.
Annual bonus
All of our contracted employees participate in either an annual bonus plan or a commission scheme.
For the annual bonus, the opportunity and performance measures vary depending on grade, location and business unit,
however the structure is broadly consistent for all employees.
Long-term incentives
Pay for senior management is primarily differentiated through the use of our long-term incentive plans. Executive directors
and around 1,800 senior managers participate in either the PSP and CIP, or receive restricted share awards. As such, their
pay is contingent on the achievement of performance targets and/or delivered in shares. This makes outcomes conditional
on successfully delivering our business strategy and, in doing so, incentivises the delivery of long-term shareholder returns.
Pay scenarios
The above charts are prepared on the following basis:
Fixed pay:
includes FY24 base salary, FY24 cash in lieu of pension allowances and assumes a similar value of benefits as FY23.
Target:
includes fixed pay plus the level of performance required to deliver 50% of the maximum annual bonus, and 50% of the maximum PSP and CIP awards respectively, with the CIP matching award
being based on 100% deferral.
Maximum:
includes fixed pay plus the maximum annual bonus payment and full vesting of the CIP and PSP awards, with the CIP matching award being based on 100% deferral of a maximum annual
bonus.
Maximum:
with 50% share price increase: includes all elements included in maximum and assumes the share price increases 50% above that on the date of grant. The 50% share price increase has been
applied to shares received under the PSP and matching shares awarded under the CIP. Dividend equivalents are excluded from the above scenario models.
Brian Cassin
(£’000)
1,176
4,311
9,536
12,671
100%
27%
12%
9%
24%
49%
22%
66%
16%
75%
14,000
12,000
Fixed
pay
Target
Maximum Maximum
with 50%
share
price
increase
10,000
8,000
6,000
4,000
2,000
0
Lloyd Pitchford
(£’000)
732
2,670
5,900
7,838
100%
27%
12%
9%
24%
49%
22%
66%
16%
75%
14,000
12,000
Fixed
pay
Target
Maximum Maximum
with 50%
share
price
increase
10,000
8,000
6,000
4,000
2,000
0
Craig Boundy
(US$’000)
1,104
4,179
9,304
12,379
100%
26%
12%
9%
25%
49%
22%
66%
16%
75%
14,000
12,000
Fixed
pay
Target
Maximum Maximum
with 50%
share
price
increase
10,000
8,000
6,000
4,000
2,000
0
Fixed
Annual bonus
Long-term incentives
The charts illustrate, for
various pay scenarios,
the potential future total
remuneration that each
executive director may
realise under the
proposed Policy.
143
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
Our approach to pay on recruitment of executive directors
As a global organisation, Experian competes for executive talent in 32 countries. In the marketplace of big-platform, FinTech companies, the demand
for talented leaders often outstrips supply. From time to time, it may be necessary to appoint high-calibre executives to the Board, either by recruiting
externally or by promoting from within the Group.
In developing a remuneration package for a newly appointed executive director, we would generally set a base salary which takes into account factors
such as the individual’s skills and experience, the role they would be taking up, internal relativities, the marketplace they will operate in and their
current remuneration package. The incentive arrangements and benefits we offer, including any relocation arrangements, would be in line with the
remuneration policy set out in this report.
Maximum level of variable remuneration
We have set the usual maximum level of variable remuneration on recruitment at 800% of base salary. This is in line with the normal levels under our
variable remuneration structure, and covers the maximum annual bonus, the maximum face value of a matching award under the CIP and the normal
maximum face value of an award under the PSP.
When recruiting an executive director, the Committee would always seek to apply the normal maximum limits. However, we may, in exceptional
circumstances, make use of one or more of the higher limits outlined in the remuneration policy if we felt this was necessary in order to secure the
appointment of a particular individual.
In the case of an internal promotion to the Board, any existing variable pay element or benefit may be allowed to continue on the same terms.
Buyout awards
For an external appointment to the Board, the Committee may offer further one-off cash and/or share-based remuneration, to compensate the
individual for forfeiting any incentive awards made to them by their former employer. We would aim to make this equivalent in value, by taking into
account the likelihood of vesting, after assessing the conditions attached to any such awards. As far as possible, we would also replicate the form
(i.e. whether cash or share-based) and the timeframe in which vesting was scheduled to occur. These awards may be granted under the terms of
UK Listing Rule 9.4.2.
Directors’ service contracts and policy on payments for loss of office
Current contracts
Brian Cassin and Lloyd Pitchford have service agreements which are terminable by 12 months’ notice from Experian Limited or six months’ notice
from them. The agreement provides for payment in lieu of notice in respect of base salary only.
Craig Boundy has a service agreement with Experian Services Corp. (ESC) that is terminable by 12 months’ notice from ESC or six months’ notice
from him. The agreement provides for payment in lieu of notice in respect of base salary only.
Non-executive directors do not have service contracts but each has a letter of appointment with no provision for any termination payment. Each
appointment is for a renewable three-year term, subject to election or re-election by shareholders, but may be terminated by either party on one
month’s written notice (six months’ notice in the case of the Chair). Upon termination a non-executive director will be entitled to receive fees and
benefits up to the date of termination.
Policy for new hires
Our policy for new hires is that service contracts will generally require no more than 12 months’ notice of termination of employment and will follow
the UK Corporate Governance Code (the Code) guidelines. We believe that this is in line with best practice, remains market competitive and allows
Experian to recruit people who we identify as critical to our future performance.
Policy on payments for loss of office
The table below sets out our policy for how we treat executive directors leaving the Group (subject to the current contractual commitments described above).
We reserve the right to make additional exit payments if we need to discharge an existing legal obligation (or pay damages for breaching an
obligation). We also reserve the right to make an exit payment by way of settlement or compromise of any claim arising in connection with terminating
a director's office or employment.
Voluntary resignation or termination
Other circumstances such as death, ill health, retirement, disability
Base salary, pension
and benefits
Paid, and eligible for, up to the date of
termination and for any holidays not taken
as at that date.
Paid, and eligible for, up to the date of death or leaving and for any holidays not taken
as at that date.
If, in the judgment of the Committee, exceptional circumstances apply, such as in the
case of death, the Committee may agree to a different approach from that outlined
above, for example not applying pro-rating to a payment or not terminating family
medical cover immediately.
Annual bonus
Normally no annual bonus is paid in respect
of a financial year if an individual has left
employment or is under notice prior to the
bonus payment date.
In the exceptional event any bonus is paid,
any election already made to defer annual
bonus under the CIP will not apply.
Annual bonus will usually be paid on the normal bonus payment date, in line with
performance achieved, pro-rated for the proportion of the financial year worked.
If the Committee judges that exceptional circumstances apply, for example in the
case of death, the Committee may agree that it is not appropriate to time pro-rate
the annual bonus payment.
Any election already made to defer annual bonus under the CIP will not apply.
Directors’ remuneration policy
continued
Experian plc
Governance
144
Code principle
Remuneration
Voluntary resignation or termination
Other circumstances such as death, ill health, retirement, disability
CIP invested/
deferred shares
Invested or deferred shares will be
transferred to the individual.
Invested or deferred shares will be transferred to the individual or, in case of death, their
estate.
CIP matching shares
and PSP awards
Unvested awards will lapse. Any vested
awards structured as nil-cost options which
have not been exercised may be exercised
up to the normal lapse date.
In the case of death, performance conditions will cease to apply and unvested awards
will vest immediately.
In all other cases, subject to the Committee’s discretion and its view of the director’s
performance, unvested awards will vest at the end of the performance period and
remain subject to the relevant performance conditions.
In all circumstances, the number of shares vesting will normally be reduced pro rata,
to reflect the number of months from the start of the performance period to the date of
cessation of employment as a proportion of the performance period. If the Committee
judges that exceptional circumstances apply, for example in the case of death, the
Committee may agree that it is not appropriate to time pro-rate the number of shares
vesting.
Vested awards structured as nil-cost options which have not been exercised may be
exercised up to the normal lapse date.
Executive share
options
Unvested share options will lapse.
Vested options will not lapse and will remain
exercisable for six months, unless the
reason for leaving is dismissal for
misconduct, in which case, subject to
Committee discretion, the options will lapse
on the date of cessation of employment.
In the case of death, unvested share options will vest immediately and will remain
exercisable for 12 months. Any vested share options will also remain exercisable for
12 months.
In all other cases, any vested options will remain exercisable for six months following
cessation of employment.
Unvested options, subject to the Committee’s discretion, will vest at the end of the
performance period and remain subject to the relevant performance conditions. The
number of options vesting will normally be reduced pro rata, to reflect the number of
months from the start of the performance period to the date of cessation of employment
as a proportion of the performance period. These options will be exercisable for six
months following vesting.
Awards under
all-employee plans
In accordance with the relevant tax
regulations or plan rules.
In accordance with the relevant plan rules and tax regulations.
For executive directors who leave the Group in other circumstances, the treatment will normally fall between the two described above. In any event,
the overall treatment will be subject to the Committee’s judgment.
If there is a change of control, executive directors may exchange their incentive awards (other than CIP invested shares) for awards in the acquiring
company. CIP invested shares will be transferred to the individual. Alternatively, incentive awards may vest to the extent that the performance
condition has been satisfied. In this circumstance, CIP matching shares and PSP shares will be pro-rated to reflect the number of months from the
start of the performance period to the date of the change of control as a proportion of the performance period.
Statement of consideration of employee and shareholder views
While the Committee’s remit understandably includes the executive directors’ remuneration, we also approve the remuneration structure for other
senior executives and work closely with the Global Reward team to ensure a consistent approach is taken to remuneration more widely across the
Group. When setting the remuneration policy for the executive directors, we also take into account the pay, employment conditions and remuneration
trends across the Group, particularly in determining annual salary increases.
As part of the Committee’s standard annual agenda we are provided with an extensive paper setting out details of all employee pay and workforce
policies across Experian. The discussions on this topic provide the Committee with helpful insights for framing executive pay considerations. This year,
the Chair of the Committee enhanced this level of insight by attending the UK and Ireland Experian People Forum to explain to forum members how
executive pay arrangements align with wider Group pay policy and invited the forum members to share their views on executive pay arrangements.
Additionally, as outlined earlier in this report, every year we review and act upon the outcome of our regular people surveys, and the Committee
members are provided with a summary of both the survey results and actions taken. The Company also engaged with shareholders in designing the
policy as outlined on page 123.
The Chair of the Committee frequently writes to our largest shareholders and investor representative bodies, such as the Investment Association,
Glass Lewis and Institutional Shareholder Services Inc., to seek their input on any proposed changes to our remuneration structure or broader
directors’ remuneration policy. We then engage in further discussion and clarification, to help them make an informed voting decision as required.
Any major concerns are discussed with the Committee Chair first, and the rest of the Committee as appropriate.
At the Committee’s first meeting following each AGM, we consider all the shareholder feedback received in relation to the AGM. We also consider this
feedback, and any other feedback received during meetings or from any correspondence, as part of our annual review of remuneration policy, which
normally takes place at our meetings in November and January.
On behalf of the Remuneration Committee
Charles Brown
Company Secretary
16 May 2023
145
Experian plc
Annual Report 2023
Governance
Code principle
Remuneration
Directors’ report
The directors present their report and the
audited financial statements for the year
ended 31 March 2023. The report has been
prepared in line with the UK Companies Act
2006, and the Corporate governance report
and the Shareholder and corporate
information section form part of this Directors’
report. The Strategic report contains certain
information equivalent to that required in a
report of the directors.
Financial and operational information
Results and dividend
The Group income statement shows a profit
for the year ended 31 March 2023 of US$773m
(2022: US$1,167m). The directors have
announced the payment of a second interim
dividend, in lieu of a final dividend, of 37.75 US
cents (2022: 35.75 US cents) per ordinary
share to be paid on 21 July 2023 to
shareholders on the register of members
on 23 June 2023. A first interim dividend of
17.0 US cents per ordinary share was paid on
3 February 2023, giving a total dividend for the
year of 54.75 US cents per ordinary share
(2022: 51.75 US cents).
Innovation
Innovation, supported by our talented people,
and by research and development, plays a
key role in supporting Experian’s business
performance. Details of such activities are
given in the Strategic report.
Acquisitions and disposals
Information on acquisitions and disposals
made during the year is contained in note 42
and note 44 respectively to the Group financial
statements.
Registered branch
The Company has a branch registered in
Ireland under branch number 905565.
Post-balance sheet events
Details of events occurring after the end of the
reporting period are contained in note 48 to the
Group financial statements.
Share capital
Details of the Company’s share capital and
changes during the year ended 31 March 2023
are set out in note Q to the Company financial
statements.
Financial risk management, objectives
and policies
Descriptions of the use of financial instruments
and Experian’s treasury and risk management
objectives and policies are set out in the
Financial review within the Strategic report,
and also in note 8 to the Group financial
statements.
Political donations
Experian did not make any political donations
during the year ended 31 March 2023.
Going concern
Details of the adoption of the going concern
basis in preparing the Group financial
statements are set out in note 2 to the Group
financial statements, and are incorporated into
this report by reference. For details of the
adoption of the going concern basis in
preparing the Company financial statements,
see note B.
Directors
Information on directors holding office
in the year
The directors’ names, biographical details, and
skills and experience are shown in the Board
of directors section. At the Annual General
Meeting on 21 July 2022, Deirdre Mahlan,
George Rose and Kerry Williams left the Board,
and Craig Boundy (our Chief Operating Officer)
was appointed as a director. Kathleen DeRose
and Louise Pentland were appointed as
non-executive directors on 1 November
2022 and Esther Lee was appointed as a
non-executive director on 31 March 2023.
Dr Ruba Borna stepped down as a
non-executive director on 31 January 2023.
Particulars of directors’ remuneration, service
contracts and interests in the Company’s
ordinary shares are shown in the Report on
directors’ remuneration. There were no
changes in the directors’ interests (as at
31 March 2023) in the ordinary shares between
the end of the financial year and 16 May 2023.
In line with the UK Corporate Governance Code,
as at the date of this report, all directors, being
eligible, will offer themselves for election or
re-election at the 2023 AGM. An evaluation of
the performance of the Board, its committees
and individual directors was carried out during
the financial year. The Board is satisfied that
all directors seeking re-election contribute
effectively and demonstrate commitment to
their roles. The Corporate governance report
contains further details of the evaluation
process and outcomes.
Insurance and third-party
indemnification
During the year and up to the date of
approval of this Annual Report, the Company
maintained liability insurance and third-party
indemnification provisions for its directors
and officers.
Appointment and removal of directors
Both the Company, by ordinary resolution, and
the directors, may elect any person to be a
director. The number of directors shall not
exceed the maximum number fixed by the
Company’s articles of association. Any person
appointed by the directors shall hold office only
until the next AGM and shall then be eligible for
election. The office of a director shall be
vacated on the occurrence of any of the events
listed in article 96 of the Company’s articles of
association. The Company may, in accordance
with its articles of association, remove any
director from office and elect another person
in their place.
Annual General Meeting
The Company’s 2023 AGM will be held at The
Merrion Hotel, Upper Merrion Street, Dublin 2,
D02 KF79, Ireland, at 9.30am on Wednesday
19 July 2023. Shareholders who are unable to
attend may submit questions beforehand via
email to
agmquestions@experianplc.com
or on the pre-paid card sent with the notice of
the meeting. The questions will be addressed
at the meeting, via the Company’s website
at
www.experianplc.com
or individually as
appropriate. The notice of meeting has been
circulated to shareholders and can also be
viewed on the Company’s website.
Share capital information
Rights and obligations
The rights and obligations attaching to the
ordinary and deferred shares are set out in
note Q to the Company financial statements
and in the Company’s articles of association,
a copy of which can be obtained from the
Experian website,
www.experianplc.com
.
The Company’s articles of association may
be amended by passing a special resolution.
Experian plc
Governance
146
ADR programme
The Company has a Level 1 American
Depositary Receipt (ADR) programme in the
USA, for which J.P. Morgan Chase Bank, N.A.
acts as depositary. The ADRs are traded on the
highest tier of the US over-the-counter market,
OTCQX, with each ADR representing one
Experian plc ordinary share. Further details
are given in the Shareholder and corporate
information section.
Substantial shareholdings
The Company’s articles of association oblige
shareholders to comply with the notification
obligations contained in the UK Disclosure
Guidance and Transparency Rules sourcebook.
As at 16 May 2023, the Company had been
notified of the indirect interest below in its
issued ordinary share capital or voting rights
in respect of the year.
Date of notification
Shareholder
Number of ordinary shares/
voting rights
Percentage of issued share
capital/voting rights
24 June 2022
WCM Investment
Management, LLC
46,017,010
4.9%
Restrictions on transfers of shares
and/or voting rights
The Company is not aware of any agreements
between shareholders that may result in
restrictions on the transfer of securities and/or
voting rights and, apart from the matters
described below, there are no restrictions on
the transfer of the Company’s ordinary shares
and/or voting rights:
a
Certain restrictions on transfers of shares
may from time to time be imposed by, for
example, share dealing regulations. In
certain situations, directors and certain
employees must seek the Company’s
approval to deal in its shares.
a
Some of Experian’s share-based employee
incentive plans include restrictions on the
transfer of shares, while the shares are
subject to the plan concerned.
a
As described in the Report on directors’
remuneration, non-executive directors must
hold a proportion of their fees in shares, at
least equal to their annual fee. These shares
may not normally be transferred during
their period of office.
a
Where participants in a share-based
employee incentive plan operated by
Experian are the beneficial owners of the
shares but not the registered owner, the
voting rights are normally exercised by the
registered owner at the direction of the
participants.
a
Shares carry no voting rights while they are
held in treasury.
a
The deferred shares in the Company carry
no voting rights.
a
Unless the directors determine otherwise,
members are not entitled to vote personally
or by proxy at a shareholders’ meeting, or
to exercise any other member’s right in
relation to shareholders’ meetings, in
respect of any share for which any call or
other sum payable to the Company remains
unpaid.
a
Unless the directors determine otherwise,
members are not entitled to vote personally
or by proxy at a shareholders’ meeting, or
to exercise any other member’s right in
relation to shareholders’ meetings, if the
member fails to provide the Company
with the required information concerning
interests in those shares, within the
prescribed period after being served with
a notice under the Company’s articles of
association.
a
The Company’s articles of association state
that, except for certain limited
circumstances, if the number of shares in
the Company beneficially owned by
residents of the USA exceeds a defined
permitted maximum and the directors give
notice to the holder(s) of such shares, the
shares do not give their holder(s) the right to
receive notice of, attend or vote at the
Company’s general meetings.
Details of deadlines for voting at the 2023 AGM
are contained in the notice of meeting that has
been circulated to shareholders, and which
can also be viewed at the Company’s website.
Purchase, cancellation and holdings
of own shares
The existing authority for the Company to
purchase its own shares was given at the AGM
held on 21 July 2022. It permits the Company
to purchase 92,080,068 of its own shares in the
market.
On 18 May 2022, the Company announced its
intention to repurchase shares, through a net
US$175m share repurchase programme.
During the year ended 31 March 2023, the
Company purchased 4,754,551 of its own
shares, at a cost of US$149m (with 2,559,609
shares purchased before the 2022 AGM). No
shares have been purchased by the Company
since 31 March 2023. All shares purchased
have been retained as treasury shares.
On 13 June 2022 and 30 June 2022, the
Company transferred 958,028 and 10,579
ordinary shares respectively from treasury
to Computershare Investor Services plc and
Computershare Trustees (Jersey) Limited,
the administrator and trustee respectively of
Experian’s share plans, for nil consideration,
to be used to meet obligations under employee
share plans.
As at the date of approval of this Annual
Report, the Company holds 52,222,358 (2022:
48,436,414) of its own shares as treasury
shares, and had an unexpired authority to
purchase up to 89,885,126 of its own shares.
Details of the new authority being requested at
the 2023 AGM are contained in the circular to
shareholders, which either accompanies this
Annual Report or is available on the Company’s
website at
www.experianplc.com
.
Details of the shares in the Company
purchased by and held under The Experian plc
Employee Share Trust and the Experian UK
Approved All Employee Share Plan are set out
in note R to the Company financial statements.
Significant agreements – change
of control
The Group is party to a number of agreements
that take effect, alter, terminate, or have the
potential to do so, upon a change of control of
the Company following a takeover bid. These
agreements are as follows:
a
The Group’s banking facilities contain
provisions which, in the event of a change of
control, could result in their renegotiation or
withdrawal.
a
The Group’s Euronotes allow holders to
require repayment of the notes, if a rating
agency re-rates the notes to below
investment grade, following a change of
control.
a
All of Experian’s share-based employee
incentive plans contain provisions relating
to a change of control. Outstanding awards
and options would normally vest and
become exercisable, subject to satisfaction
of any performance conditions at that time.
a
The Group is party to a limited number of
operational arrangements that can be
terminated or altered upon a change of
control of the Company, but these are not
considered to be individually significant to
the Group’s business as a whole. In certain
cases, it is considered that their disclosure
would be seriously prejudicial to the
Company.
a
The provisions in directors’ service
contracts relating to a change of control of
the Company are described in the Report on
directors’ remuneration.
147
Experian plc
Annual Report 2023
Governance
Employment information
Employment of people with disabilities
People with disabilities have equal
opportunities when applying for vacancies.
In addition to complying with legislative
requirements, the Group has procedures
to ensure it treats employees with disabilities
fairly and manages their training and career
development needs carefully. The policies are
considered to operate effectively. The Group
supports employees who become disabled
during the course of their employment, by
offering re-training or re-deployment, to
enable them to remain with the Group
whenever possible.
Employee involvement
Experian is committed to employee
involvement throughout the business. The
Group is intent on motivating staff, keeping
them informed on matters that concern them
in the context of their employment, and
involving them through local consultative
procedures. Where there are recognition
agreements with trade unions, the consultation
process is established through national and
local trade union representatives and through
joint consultation committees.
Employees are kept well informed on matters
of interest and the financial and economic
factors affecting the Group’s performance.
This is done through management channels,
conferences, meetings, publications and
intranet sites. More detail on employee
engagement, together with information on
corporate responsibility, diversity, succession
planning and talent development, can be found
in the Sustainable business section of the
Strategic report.
Experian supports employee share ownership
by providing, whenever possible, employee
share plan arrangements that are intended
to align employees’ interests with those of
shareholders.
Auditor information
Relevant audit information
As at 16 May 2023, so far as each director is
aware, there is no relevant information needed
by the auditor in connection with preparing the
audit report, of which the auditor is unaware,
and all directors have taken all steps they
ought to have taken as directors to make
themselves aware of any relevant audit
information and to establish that the auditor
is aware of it.
Independent auditor
The auditor, KPMG LLP, has indicated its
willingness to continue in office and a
resolution that it be re-appointed as the
Company’s auditor will be proposed at
the AGM.
Statement of directors’ responsibilities
The directors are responsible for:
a
Preparing the Annual Report, the Group
and Company financial statements in
accordance with applicable law and
regulations. The directors have decided
to prepare voluntarily a directors’
remuneration report in accordance with
Schedule 8 to The Large and Medium-sized
Companies and Groups (Accounts and
Reports) Regulations 2008 made under
the UK Companies Act 2006, as if those
requirements applied to the Company.
a
Preparing financial statements which give
a true and fair view of the state of affairs at
the balance sheet date, and the profit or loss
for the period then ended of (a) the Group
(in accordance with IFRSs as adopted for
use in the European Union and UK-adopted
IFRS and IASB-IFRS), and (b) the Company
(in accordance with UK Accounting
Standards including FRS 101 ‘Reduced
Disclosure Framework’).
a
Keeping sufficient accounting records that
disclose, with reasonable accuracy, at any
time, the financial position of the Group and
the Company and enable them to ensure the
Group financial statements comply with
applicable laws.
a
Maintaining such internal control as they
determine is necessary to enable the
preparation of financial statements free
from material misstatement, whether
due to fraud or error, and have general
responsibility for taking the steps
reasonably open to them to safeguard
the assets of the Group and the Company
and to prevent and detect fraud and other
irregularities.
a
The maintenance and integrity of the
statutory and audited information on the
Company’s website. Jersey legislation and
UK regulations governing the preparation
and dissemination of financial statements
may differ from requirements in other
jurisdictions.
In addition, the directors consider that,
in preparing the financial statements:
a
suitable accounting policies have been
selected and applied consistently
a
judgments and estimates made have
been reasonable, relevant and reliable
a
the Group financial statements comply with
IFRSs as adopted for use in the European
Union and UK-adopted IFRS and IASB-IFRS
a
the Company financial statements comply
with UK Accounting Standards including
FRS 101 ‘Reduced Disclosure Framework’,
subject to any material departures disclosed
and explained in the financial statements
a
the Group’s and Company’s ability to
continue as a going concern has been
assessed and, as applicable, matters related
to going concern have been disclosed
a
it is appropriate that the Group and
Company financial statements have been
prepared on the going concern basis, unless
it is intended to liquidate the Company or any
Group company, or to cease operations or
there is no realistic alternative to do so.
The directors also confirm that, to the best of
their knowledge, the financial statements are
prepared in accordance with the applicable
set of accounting standards, give a true and
fair view of the assets, liabilities, financial
position and profit of the Company and the
undertakings included in the consolidation
taken as a whole; and the Strategic report
contains a fair review of the development and
performance of the business and the position
of the Company and the undertakings included
in the consolidation taken as a whole, together
with a description of the principal risks and
uncertainties they face.
In addition, each of the directors considers that
the Annual Report and financial statements,
taken as a whole, is fair, balanced and
understandable, and provides the information
necessary for shareholders to assess the
Group’s position and performance, business
model and strategy.
By order of the Board
Charles Brown
Company Secretary
16 May 2023
Corporate headquarters:
2 Cumberland Place
Fenian Steet
Dublin 2
D02 HY05
Ireland
Registered office:
22 Grenville Street
St Helier
Jersey
JE4 8PX
Channel Islands
Directors’ report
continued
Experian plc
Governance
148
Financial statements
In this section
150 Independent auditor’s report
Group financial statements
162 Group income statement
163
Group statement of
comprehensive income
164 Group balance sheet
165
Group statement of changes
in equity
166 Group cash flow statement
Notes to the Group financial
statements
167 1. Corporate information
167 2. Basis of preparation
167 3. Climate-related matters
167 4. Recent accounting developments
168 5.
Significant accounting policies
175 6.
Critical accounting estimates,
assumptions and judgments
175 7.
Use of non-GAAP measures in the
Group financial statements
177 8. Financial risk management
179 9. Revenue
180 10. Segment information
185 11. Foreign currency
185 12.
Labour costs and employee
numbers – continuing operations
186 13.
Amortisation and depreciation
charges
186 14.
Fees payable to the
Company’s auditor
187 15.
Exceptional items and
other adjustments made
to derive Benchmark PBT –
continuing operations
188 16.
Net finance expense/(income)
190 17.
Tax charge
191 18. Discontinued operations
191 19. Earnings per share disclosures
192 20. Dividends on ordinary shares
193 21. Goodwill
195 22. Other intangible assets
196 23. Property, plant and equipment
197 24. Investments in associates
197 25. Trade and other receivables
198 26.
Cash and cash equivalents
– excluding bank overdrafts
199 27. Trade and other payables
199 28. Borrowings
200 29. Net debt (non-GAAP measure)
202 30. Leases
203 31. Financial assets and liabilities
208 32. Fair value methodology
209 33.
Contractual undiscounted future
cash flows for financial liabilities
210 34. Share incentive plans
212 35.
Post-employment benefit plans
and related risks
213 36.
Post-employment benefits –
IAS 19 information
216 37. Deferred and current tax
218 38. Provisions
218 39.
Called-up share capital and
share premium account
218 40.
Retained earnings and
other reserves
220 41.
Notes to the Group cash flow
statement
222 42. Acquisitions
223 43.
Assets and liabilities classified as
held-for-sale
224 44. Disposals
224 45. Capital commitments
224 46. Contingencies
225 47. Related party transactions
225 48.
Events occurring after the end
of the reporting period
Company financial statements
226 Company profit and loss account
226
Company statement of
comprehensive income
227 Company balance sheet
228
Company statement of changes
in equity
229
Notes to the Company
financial statements
149
Experian plc
Annual Report 2023
Financial statements
1. Our opinion is unmodified
In our opinion:
a
the Group financial statements give a true and fair view, in accordance with UK-adopted international accounting standards (“UK-IFRS”) and
International Financial Reporting Standards as adopted by the European Union (“EU-IFRS”), of the Group’s affairs as at 31 March 2023 and of its profit
for the year then ended;
a
the Parent Company financial statements give a true and fair view, in accordance with UK accounting standards, including FRS 101 Reduced
Disclosure Framework, of the Parent Company’s affairs as at 31 March 2023 and of its profit for the year then ended; and
a
the Group and Parent Company financial statements have been prepared in accordance with the requirements of the Companies (Jersey) Law 1991.
Additional opinion in relation to IFRS as adopted by the International Accounting Standards Board (“IASB”)
As explained in note 2 to the Group financial statements, the Group, in addition to applying both UK-IFRS and EU-IFRS, has also applied IFRS as issued by
the IASB. In our opinion, the Group financial statements have been properly prepared in accordance with IFRS as issued by the IASB.
What our opinion covers
We have audited the Group and Parent Company financial statements of Experian plc (“the Company”) for the year ended 31 March 2023 (FY23) included
in the Annual Report and Accounts, which comprise:
Group
Parent Company (Experian plc)
Group income statement, Group statement of comprehensive income, Group
balance sheet, Group statement of changes in equity and Group cash flow
statement.
Notes 1 to 48 to the Group financial statements, including the accounting
policies in note 5.
Company profit and loss account, Company statement of comprehensive
income, Company balance sheet and Company statement of changes in equity.
Notes A to T to the Parent Company financial statements, including the
accounting policies in note D.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are described
below. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion. Our audit opinion and matters included
in this report are consistent with those discussed and included in our reporting to the Audit Committee.
We have fulfilled our ethical responsibilities under, and we remain independent of the Group in accordance with, UK ethical requirements including the
Financial Reporting Council (“FRC”) Ethical Standard as applied to listed public interest entities.
2. Overview of our Audit
Factors driving our view of risks
Following our FY22 audit and considering developments affecting the Experian plc Group since then, our
assessment of risks and our view of how these impact the audit of the financial statements has been
updated.
An agreement has been reached with the UK tax authorities for the Group’s most significant uncertain tax
position such that we no longer consider that provisions for uncertain tax positions represents a key audit
matter for the current year audit.
As a result of a more challenging trading environment and macro-economic factors causing adverse
movements in the key assumptions used in the impairment reviews, the risk associated with the
recoverability of goodwill in respect of the EMEA and Asia Pacific cash generating units has increased
from FY22.
The industry that the Group operates in is subject to increasingly complex legislation and regulators,
particularly in the United States, are continuing at their high levels of scrutiny. We therefore consider that
the risk associated with litigation and contingent liabilities as a whole, continues to be heightened,
consistent with FY22.
Our assessment is that the risk of recoverability of the Parent Company’s investments in subsidiaries
remains consistent with FY22.
Key Audit Matters
Vs FY22
Item
Recoverability of goodwill in
respect of the EMEA and
APAC cash generating units
4.1
Litigation and contingent
liabilities
4.2
Recoverability of the Parent
Company’s investment in
subsidiaries
4.3
Audit Committee interaction
During the year, the Audit Committee met four times. KPMG are invited to attend all Audit Committee meetings and are provided with an opportunity to meet with
the Audit Committee in private sessions without the executive directors being present. For each key audit matter, we have set out communications with the Audit
Committee in section 4, including matters that required particular judgment for each.
The matters included in the Audit Committee Chair’s report on page 113 are materially consistent with our observations of those meetings.
Independent auditor’s report
To the members of Experian plc
Experian plc
Financial statements
150
Our independence
We have fulfilled our ethical responsibilities and we remain independent of the Group in accordance with
UK ethical requirements including the FRC Ethical Standard as applied to listed public interest entities.
Apart from the matters noted below, we have not performed any non-audit services during the year ended
31 March 2023 or subsequently which are prohibited by the FRC Ethical Standard.
During 2023, we identified that certain KPMG member firms had provided preparation of local GAAP
financial statement services and in some cases foreign language translation services over the period FY18
to FY23 to entities which are residual components and therefore not in scope for the Group audit. The
services, which have been terminated, were administrative in nature and did not involve any management
decision-making or bookkeeping. The work in each case was undertaken after the Group audit opinion
was signed by KPMG LLP for each of the impacted financial years and had no direct or indirect effect on
Experian plc’s consolidated financial statements. In our professional judgment, we confirm that based on
our assessment of the breach, our integrity and objectivity as auditor has not been compromised and we
believe that an objective, reasonable and informed third party would conclude that the provision of this
service would not impair our integrity or objectivity for any of the impacted financial years. The Audit
Committee have concurred with this view.
We were first appointed as auditor by the shareholders for the year ended 31 March 2017. The period of
total uninterrupted engagement is for the seven financial years ended 31 March 2023. The Group
engagement partner is required to rotate every five years. As these are the first set of the Group’s financial
statements signed by Zulfikar Kamran Walji, he will be required to rotate off after the FY27 audit. The
average tenure of partners responsible for component audits as set out in section 7 below is three years,
with the shortest being one and the longest being four.
Total audit fee
US$6.8m
Audit related fees (including
interim review)
US$0.6m
Other services
US$0.2m
Non-audit fee as a % of total audit
and audit related fee %
2.6%
Date first appointed
20 July 2016
Uninterrupted audit tenure
7 years
Next financial period which
requires a tender
31 March 2027
Tenure of Group engagement
partner
1 year
Average tenure of component
signing partners
3 years
Materiality
(Item 6 below)
The scope of our work is influenced by our view of materiality and our assessed risk of material
misstatement.
We have determined overall materiality for the Group financial statements as a whole at US$70m (FY22:
US$61m) and for the Parent Company financial statements as a whole at US$25m (FY22: US$25m).
Consistent with FY22, we determined that profit before tax from continuing operations (PBTCO) remains
the appropriate benchmark for the Group considering the sector in which the Group operates, its
ownership and financing structure, and the focus of users of the financial statements. For FY23, we have
normalised this benchmark to exclude the significant impairment charge of goodwill and charges
associated with the significant restructuring programme. As such, we based our Group materiality on
profit before tax from continuing operations before the impairment of goodwill and restructuring costs,
of which it represents 5.0% (FY22: 4.2%).
Materiality for the Parent Company financial statements was determined with reference to a benchmark
of Parent Company total assets of which it represents 0.1% (FY22: 0.1%).
Group
Group
Group Materiality
GPM
Group Performance Materiality
HCM
Highest Component Materiality
PLC
Parent Company Materiality
LCM
Lowest Component Materiality
AMPT
Audit Misstatement Posting Threshold
GPM
HCM
PLC
LCM
AMPT
Materiality levels used in our audit
46
53
45
52
13
21
25
25
3.5
3
61
70
FY23 US$m
FY22 US$m
2. Overview of our Audit continued
151
Experian plc
Annual Report 2023
Financial statements
Group scope
(Item 7 below)
We have performed risk assessment and planning procedures to determine which of the Group’s
components are likely to include risks of material misstatement to the Group financial statements, the
type of procedures to be performed at these components and the extent of involvement required from our
component auditors around the world.
We identified three (FY22: three) components as individually financially significant components and full
scope audits were performed on these components by component auditors (KPMG member firms). The
work on the Parent Company was performed by the Group team.
We have also considered the extent to which the Group has established shared service centres in the UK,
USA, Malaysia, Costa Rica and Bulgaria. The outputs of these centres are included in the financial
information of the reporting components and therefore they are not considered to be separate reporting
components.
We have performed certain audit procedures centrally across the Group, details of which are included in
Section 7. In addition, we have performed Group level analysis on the remaining out of scope components
to determine whether further risks of material misstatement exist in those components.
The components within the scope of our work accounted for the percentages illustrated opposite.
We consider the scope of our audit, as communicated to the Audit Committee, to be an appropriate basis
for our audit opinion.
Profit before tax*
85% (FY22: 90%)
Coverage of Group financial statements
85
15
Total assets
90% (FY22: 90%)
90
10
Revenue
91% (FY22: 89%)
91
9
Full scope audits
*Total profits or losses that make up Group profit
before tax (continuing operations)
Residual components
The impact of climate change on audit
We have considered the potential impacts of climate change on the financial statements as part of planning our audit.
As the Group has set out on page 57-59, climate change has the potential to give rise to a number of transition risks, physical risks and opportunities. The Group
has stated its commitment to become carbon neutral across its own operations by 2030.
The areas of its financial statements that are most likely to be potentially affected by climate related changes and initiatives are balances subject to forward
looking assessments such as impairment tests for indefinite and other long lived non-current assets. The Group considered the impact of climate change and the
Group’s targets in the preparation of the financial statements, as described in note 3 in relation to impairment, and this did not have a material effect on the
consolidated financial statements.
We performed a risk assessment, taking into account climate change risks and the commitments made by the Group. This included enquiries of management,
consideration of the Group’s processes for assessing the potential impact of climate change risk on the Group’s financial statements, assessing the Task Force on
Climate Related Financial Disclosures scenario analysis performed by the Group and reading the Group’s CDP submission.
Based on our risk assessment we determined that, taking into account the limited extent of the impact of climate change on financial forecasts used to determine
the recoverability of goodwill, there are no significant risks of material misstatement in relation to climate change. Therefore, we assessed that the impact on our
audit is not significant for this financial year.
There was no significant impact of climate change on our key audit matters included in section 4.
We have read the Group’s disclosure of climate related information in the Sustainable business section of the Annual Report and Accounts as set out on pages 36
to 63 and considered consistency with the financial statements and our audit knowledge.
Independent auditor’s report
continued
2. Overview of our Audit continued
Experian plc
Financial statements
152
3. Going concern, viability and principal risks and uncertainties
The directors have prepared the financial statements on the going concern basis as they do not intend to liquidate the Group or the Parent Company or
to cease their operations, and as they have concluded that the Group’s and the Parent Company’s financial position means that this is realistic. They have
also concluded that there are no material uncertainties that could have cast significant doubt over their ability to continue as a going concern for at least
a year from the date of approval of the financial statements (the 'going concern period').
Going concern
We used our knowledge of the Group, its industry, and the general economic environment to identify the
inherent risks to its business model and analysed how those risks might affect the Group’s and Parent
Company’s financial resources or ability to continue operations over the going concern period. The risk
that we considered most likely to adversely affect the Group’s and Parent Company’s available financial
resources and metrics relevant to debt covenants over this period, is the loss or misuse of data resulting
from a ransomware incident, leading to serious reputational and brand damage, legal penalties, and class
action litigation.
We considered whether these risks could plausibly affect the liquidity or covenant compliance in the going
concern period by assessing the degree of downside assumption that, individually and collectively, could
result in a liquidity issue, taking into account the Group’s current and projected cash and facilities (a
reverse stress test). We also assessed the completeness of the going concern disclosure.
Accordingly, based on those procedures, we found the directors’ use of the going concern basis of
accounting without any material uncertainty for the Group and Parent Company to be acceptable.
However, as we cannot predict all future events or conditions and as subsequent events may result in
outcomes that are inconsistent with judgments that were reasonable at the time they were made, the
above conclusions are not a guarantee that the Group or the Parent Company will continue in operation.
Our conclusions
a
We consider that the directors’ use of the going
concern basis of accounting in the preparation
of the financial statements is appropriate;
a
We have not identified, and concur with the
directors’ assessment that there is not, a
material uncertainty related to events or
conditions that, individually or collectively, may
cast significant doubt on the Group’s or Parent
Company's ability to continue as a going
concern for the going concern period;
a
We have nothing material to add or draw
attention to in relation to the directors’
statement in note 2 to the financial statements
on the use of the going concern basis of
accounting with no material uncertainties that
may cast significant doubt over the Group and
Parent Company’s use of that basis for the
going concern period, and we found the going
concern disclosure in note 2 to be acceptable.
Disclosures of emerging and principal risks and longer-term viability
Our responsibility
We are required to perform procedures to identify whether there is a material inconsistency between the
directors’ disclosures in respect of emerging and principal risks and the viability statement, and the
financial statements and our audit knowledge.
Based on those procedures, we have nothing material to add or draw attention to in relation to:
a
the directors’ confirmation within the viability statement on page 87 that they have carried out a robust
assessment of the emerging and principal risks facing the Group, including those that would threaten
its business model, future performance, solvency and liquidity;
a
the Emerging and Principal Risks disclosures describing these risks and how emerging risks are
identified and explaining how they are being managed and mitigated; and
a
the directors’ explanation in the viability statement of how they have assessed the prospects of the
Group, over what period they have done so and why they considered that period to be appropriate, and
their statement as to whether they have a reasonable expectation that the Group will be able to
continue in operation and meet its liabilities as they fall due over the period of their assessment,
including any related disclosures drawing attention to any necessary qualifications or assumptions.
Our work is limited to assessing these matters in the context of only the knowledge acquired during our
financial statements audit. As we cannot predict all future events or conditions and as subsequent events
may result in outcomes that are inconsistent with judgements that were reasonable at the time they were
made, the absence of anything to report on these statements is not a guarantee as to the Group’s and
Parent Company’s longer-term viability.
Our reporting
a
We have nothing material to add or draw
attention to in relation to these disclosures.
a
We have concluded that these disclosures are
materially consistent with the financial
statements and our audit knowledge.
4. Key audit matters (KAMs)
What we mean
Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the financial statements and include the most
significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those which had the greatest effect on:
a
the overall audit strategy;
a
the allocation of resources in the audit; and
a
directing the efforts of the engagement team.
153
Experian plc
Annual Report 2023
Financial statements
We summarise below the key audit matters in decreasing order of audit significance, in arriving at our audit opinion above, together with our key audit
procedures to address those matters and our results from those procedures in order that the Company’s members, as a body, may better understand
the process by which we arrived at our audit opinion. These matters were addressed, and our results are based on procedures undertaken, in the context
of, and solely for the purpose of our audit of the financial statements as a whole, and in forming our opinion thereon, and consequently are incidental to
that opinion, and we do not provide a separate opinion on these matters.
4.1 Recoverability of goodwill in respect of the EMEA and Asia Pacific CGUs (Group)
Financial Statement Elements
Our assessment of risk vs FY22
Our results
FY23
FY22
As a result of a more challenging trading environment and
macro-economic factors causing adverse movements in the
key assumptions used in the impairment reviews, the risk
associated with the recoverability of goodwill in respect of the
EMEA and APAC cash generating units has increased from
FY22.
FY23: Acceptable
FY22: Acceptable
EMEA CGU Goodwill
US$409m
US$649m
APAC CGU Goodwill
US$80m
US$88m
Impairment charge
US$179m
US$nil
Description of the Key Audit Matter
Our response to the risk
Forecast based assessment:
The estimated recoverable amount of the EMEA cash generating unit
(“CGU”) was below the carrying value of the CGU’s assets and an
impairment charge has been recognised in the period. The APAC
CGU’s estimated recoverable amount provides relatively low
headroom compared to the Group’s other CGUs where there is
significant headroom between the value-in-use and carrying value
of CGU assets.
The carrying values of both CGUs are sensitive to changes in key
assumptions, principally relating to revenue, profit margins,
long-term growth rates and discount rates, which could have a
material impact on the carrying value of the associated goodwill in
APAC and EMEA and impairment charge recognised for EMEA.
The effect of these matters is that, as part of our risk assessment,
we determined that the recoverability of the EMEA and APAC
goodwill has a high degree of estimation uncertainty, with a potential
range of reasonable outcomes greater than our materiality for the
financial statements as a whole. The financial statements (note 21)
disclose the sensitivity estimated by the Group.
We performed the tests below rather than seeking to rely on any of the Group's controls
because the nature of the balance is such that we would expect to obtain audit evidence
primarily through the detailed procedures described.
Our procedures to address the risk included:
Assessing methodology:
We assessed whether the principles and integrity of the cash
flow model used to estimate their recoverable amounts is in accordance with the
relevant accounting standards;
Assessing impact of restructuring:
We assessed the impact of the restructuring in the
regions on the determination of CGUs for the purpose of goodwill impairment
assessments;
Challenging growth assumptions:
We challenged the Group’s assumptions on revenue,
profit margins and long term growth rates by corroborating these where possible to
other sources of information, such as board-approved strategy plans, and external
sources;
Our sector experience:
We critically assessed the appropriateness of the discount rates
applied through the use of our valuations specialists;
Sensitivity analysis:
We performed both breakeven and severe but plausible downside
sensitivity analysis on the key assumptions noted above to identify sensitivity to potential
impairments;
Historical comparisons:
We evaluated the track record of historical assumptions used
against actual results achieved; and
Assessing transparency:
We assessed whether the Group’s disclosures about the
sensitivity of the outcome of the impairment assessment to a reasonably possible
change in key assumptions reflected the risks inherent in the valuation of goodwill.
Communications with Experian plc’s Audit Committee
Our discussions with and reporting to the Audit Committee included:
a
Our audit approach as set out above, including not placing any reliance on controls and the involvement of our valuation specialists;
a
Our conclusions from the procedures performed; and
a
Our views on the disclosures included with respect to the impairment charge for EMEA and the sensitivity of the impairment conclusions to reasonably possible
changes in assumptions.
Areas of particular auditor judgement
We identified the following as the areas of particular auditor judgement:
a
The estimate is particularly sensitive to key assumptions in the impairment model including revenue growth rates, profit margins, long-term growth rates and
discount rates and auditor judgement is required to assess whether the directors’ overall estimate falls within an acceptable range.
Our results
We found the Group’s conclusion that there is no impairment of goodwill for the APAC CGU and the goodwill balance and the related impairment charge
recognised for the EMEA CGU to be acceptable (FY22 result: acceptable).
Further information in the Annual Report and Accounts: See the Audit Committee Report on page 115 for details on how the Audit Committee considered
impairment of goodwill as an area of significant attention, notes 5 and 6 for the accounting policy on goodwill, and note 21 for the financial disclosures.
Independent auditor’s report
continued
Experian plc
Financial statements
154
4.2 Litigation and contingent liabilities (Group)
Financial Statement Elements
Our assessment of risk vs FY22
Our results
FY23
FY22
The industry that the Group operates in is subject to
increasingly complex legislation and regulators, particularly
in the United States, are continuing at their high levels of
scrutiny. We therefore consider that the risk associated with
litigation and contingent liabilities as a whole continues to be
heightened, consistent with FY22.
FY23: Acceptable
FY22: Acceptable
Contingent liability disclosures
Note 46 disclosures
Description of the Key Audit Matter
Our response to the risk
Dispute outcome:
The Group operates in an industry with continuously high levels of
regulation and is subject to enforcement activity and litigations.
Those with significant judgement involved include enforcement
activity by the US Consumer Financial Protection Bureau (CFPB), the
US Federal Trade Commission (FTC), and litigation by the UK
Information Commissioner’s Office (ICO) and the Brazilian tax
authorities.
We do not assess there to be a significant risk in relation to
estimation uncertainty for these enforcement activities and
litigations as an outflow is either not considered probable at this
stage, or they relate to contingent liabilities which are not estimates.
However, there remains significant judgment around assessing
whether any outflow is probable and could be reliably estimated,
and if not the associated disclosures of contingent liabilities.
We performed the tests below rather than seeking to rely on any of the Group’s controls
because the nature of the area is such that we would expect to obtain audit evidence
primarily through the detailed procedures described.
Our procedures to address the risk included:
Enquiry of lawyers:
On all significant enforcement actions and litigations, where
appropriate, we assessed correspondence and enquired with the Group’s external
lawyers to corroborate our understanding of these matters, accompanied by
discussions with the Group’s internal counsel;
Challenging judgment:
We obtained detailed updates from the Group around significant
existing and potential enforcement actions and litigations and challenged the key
judgments and assumptions made in assessing whether a provision is required and/or
whether a contingent liability disclosure is required based on our knowledge of the
Group and experience of the industry in which it operates using our own legal and tax
specialists where applicable;
Historical comparisons:
We compared the outcomes of historical enforcement action
and litigation to current cases with similar fact patterns; and
Assessing transparency:
We assessed whether the Group’s disclosures detailing
significant proceedings adequately disclose the potential liabilities of the Group.
Communications with Experian plc’s Audit Committee
Our discussions with and reporting to the Audit Committee included:
a
Our audit approach as set out above, including not placing any reliance on controls and the involvement of our tax and legal specialists;
a
Our conclusions from the procedures performed; and
a
Our views on the contingent liability disclosures included with respect to the current regulatory investigations.
Areas of particular auditor judgment
We identified the following as the areas of particular auditor judgment:
a
The appropriateness of the contingent liability disclosures with respect to the current enforcement activity and tax litigation and the conclusion that no
provision is required in respect of these matters.
Our results
We consider the contingent liability disclosures made to be acceptable (FY22 result: acceptable).
Further information in the Annual Report and Accounts: See the Audit Committee Report on page 115 for details on how the Audit Committee considered
litigation, tax and other regulatory matters as an area of significant attention, note 5 and 6 for the accounting policy on contingencies, and Note 46 for the
financial disclosures.
155
Experian plc
Annual Report 2023
Financial statements
4.3 Recoverability of investments in subsidiaries (Parent Company)
Financial Statement Elements
Our assessment of risk vs FY22
Our results
FY23
FY22
Our assessment is that the risk of recoverability of the Parent
Company’s investments in subsidiaries remains consistent
with FY22.
FY23: Acceptable
FY22: Acceptable
Investments in subsidiaries
US$20,609.6m
US$19,978.5m
Impairment charge
US$79.0m
US$nil
Description of the Key Audit Matter
Our response to the risk
Low risk, high value:
The carrying amount of the Parent Company’s investments in
subsidiaries represents 99% (FY22: 100%) of the Parent Company’s
total assets.
Their recoverability is not at a high risk of significant misstatement or
subject to significant judgment. The impairment charge recognised in
the year is also not subject to judgement or estimation uncertainty as
the charge did not rely on an analysis of future cash flows in its
determination, and the net asset position of the subsidiary was an
appropriate estimate of the recoverable amount of this investment as
it no longer has any underlying activity to generate future cash flows.
However, due to their materiality in the context of the Parent Company
financial statements, this is considered to be the area that had the
greatest effect on our overall Parent Company audit.
We performed the tests below rather than seeking to rely on any of the Group's controls
because the nature of the balance is such that we would expect to obtain audit evidence
primarily through the detailed procedures described.
Our procedures to address the risk included:
Tests of detail:
We compared the carrying amount of 100% of investments in
subsidiaries with the relevant subsidiaries’ draft balance sheets to identify whether their
net assets, being an approximation of the minimum recoverable amount of the related
investments and amounts owed by subsidiary undertakings, were in excess of their
carrying amount, and assessing whether those subsidiaries have historically been profit
making.
Communications with Experian plc’s Audit Committee
Our discussions with and reporting to the Audit Committee included:
a
Our audit approach as set out above, including not placing any reliance on controls; and
a
Our conclusions from the procedures performed.
Areas of particular auditor judgment
We did not identify any areas of particular auditor judgment.
Our results
We found the balance of the Parent Company’s investments in subsidiaries and the related impairment charge, to be acceptable (FY22 result: acceptable).
Further information in the Annual Report and Accounts: See note D for the accounting policy on investments in Group undertakings and note N for the
financial disclosures.
Independent auditor’s report
continued
5. Our ability to detect irregularities, and our response
Fraud – identifying and responding to risks of material
misstatement due to fraud
Fraud risk assessment
To identify risks of material misstatement due to fraud (“fraud risks”) we
assessed events or conditions that could indicate an incentive or pressure to
commit fraud or provide an opportunity to commit fraud.
Our risk assessment procedures included:
a
Enquiring of directors, the Audit Committee, Internal Audit and inspection of
policy documentation as to the Group’s high-level policies and procedures
to prevent and detect fraud, including the internal audit function, and the
Group’s channel for “whistleblowing”, as well as whether they have
knowledge of any actual, suspected or alleged fraud;
a
Reading Board, Audit Committee, Remuneration Committee, Nomination
and Corporate Governance Committee minutes;
a
Considering remuneration incentive schemes and performance targets
for management and directors including the targets for management
remuneration linked to the Co-investment Plans and Performance Share
Plan share incentive plans;
a
Using analytical procedures to identify any unusual or unexpected
relationships; and
a
Discussions among the engagement team regarding how and where fraud
might occur in the financial statements and any potential indicators of
fraud. The discussions also involved our forensic specialists to assist us in
identifying fraud risks based on discussions of the circumstances of the
Group and Company, including consideration of fraudulent schemes that
had arisen in similar sectors and industries. The forensic specialists
participated in the initial fraud risk assessment discussions.
Risk communications
We communicated identified fraud risks throughout the audit team and
remained alert to any indications of fraud throughout the audit. This included
communication from the Group audit team to full scope component audit
teams of relevant fraud risks identified at the Group level and request to full
scope component audit teams to report to the Group audit team any instances
of fraud that could give rise to a material misstatement in the Group financial
statements.
Fraud risks
As required by auditing standards, we perform procedures to address the risk
of management override of controls and the risk of fraudulent revenue
recognition, in particular inappropriate recognition of revenue within the
licences and professional services revenue stream, significant contracts
within data breach revenue, and the risk that Group and component
management may make inappropriate accounting entries.
We did not identify any additional fraud risks.
Procedures to address fraud risks
We performed substantive audit procedures including:
a
Identifying journal entries to test for all full scope components and central
entities based on risk criteria and comparing the identified entries to
supporting documentation. These included those posted to unusual
accounts, journal entries without description, postings between benchmark
and non-benchmark that increase benchmark Earnings Before Interest and
Tax (EBIT) and journals posted by unexpected users.
a
Assessing a sample of contracts within the licences and professional
services revenue stream and significant data breach revenue, where the
revenue recognised within these streams was significant for full scope
components (being North America and the UK).
Work on the fraud risks was performed by a combination of component
auditors and the Group audit team.
Experian plc
Financial statements
156
Laws and regulations – identifying and responding to risks
of material misstatement relating to compliance with laws
and regulations
Laws and regulations risk assessment
We identified areas of laws and regulations that could reasonably be expected
to have a material effect on the financial statements from:
a
Our general commercial and sector experience;
a
Enquiries with the directors and other management (as required by auditing
standards);
a
Inspection of the Group’s key regulatory and legal correspondence;
a
Discussions with the directors and inspection of the policies and procedures
regarding compliance with laws and regulations; and
a
Relevant discussions with the Group’s internal and external legal counsel.
Our risk assessment also considered instances of non-compliance with laws
and regulations and enforcement actions against the Group during the year
and specifically those that could reasonably be expected to have a material
effect on the financial statements.
As the Group is regulated, our assessment of risks involved gaining an
understanding of the control environment including the entity’s procedures for
complying with regulatory requirements.
Risk communications
We communicated identified laws and regulations throughout our team and
remained alert to any indications of non-compliance throughout the audit. This
included communication from the Group audit team to full scope component
audit teams of relevant laws and regulations identified at the Group level and
a request for full scope component auditors to report to the Group audit team
any instances of non-compliance with laws and regulations that could give
rise to a material misstatement in the Group financial statements.
Direct laws context and link to audit
The potential effect of these laws and regulations on the financial statements
varies considerably.
First, the Group is subject to laws and regulations that directly affect the
financial statements including:
a
Financial reporting legislation (including related companies legislation);
a
Distributable profits legislation;
a
Taxation legislation; and
a
Pension legislation
We assessed the extent of compliance with these laws and regulations as part
of our procedures on the related financial statement items.
More significant indirect law/regulation areas
Secondly, the Group is subject to many other laws and regulations where the
consequences of non-compliance could have a material effect on amounts or
disclosures in the financial statements, for instance through the imposition of
fines or litigation.
We identified the following areas as those most likely to have such an effect:
a
Data protection legislation;
a
Health and safety legislation;
a
Anti-bribery and corruption laws;
a
Employment law; and
a
Certain aspects of company legislation recognising the financial and
regulated nature of the Group’s activities.
Auditing standards limit the required audit procedures to identify
non-compliance with these laws and regulations to enquiry of the directors
and other management and inspection of regulatory and legal
correspondence, if any. Therefore, if a breach of operational regulations is not
disclosed to us or evident from relevant correspondence, an audit will not
detect that breach.
Link to Key Audit Matters (KAMs)
Further detail in respect of litigations and contingent liabilities is set out in the
key audit matter disclosures in section 4.2 of this report.
Known actual or suspected matters
For the contingent liabilities disclosed in note 46 we assessed disclosures
against our understanding from legal correspondence and procedures
performed in response to the key audit matter set out in section 4.2.
Actual or suspected breaches discussed with the Audit Committee
We discussed with the Audit Committee other matters related to actual or
suspected breaches of laws or regulations, for which disclosure is not
necessary, and considered any implications for our audit.
Context
Context of the ability of the audit to detect fraud or breaches of law or
regulation
Owing to the inherent limitations of an audit, there is an unavoidable risk that
we may not have detected some material misstatements in the financial
statements, even though we have properly planned and performed our audit
in accordance with auditing standards. For example, the further removed
non-compliance with laws and regulations is from the events and transactions
reflected in the financial statements, the less likely the inherently limited
procedures required by auditing standards would identify it. In addition, as
with any audit, there remained a higher risk of non-detection of fraud, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal controls. Our audit procedures are designed to detect
material misstatement. We are not responsible for preventing non-compliance
or fraud and cannot be expected to detect non-compliance with all laws and
regulations.
157
Experian plc
Annual Report 2023
Financial statements
6. Our determination of materiality
The scope of our audit was influenced by our application of materiality.
We set quantitative thresholds and overlay qualitative considerations to
help us determine the scope of our audit and the nature, timing and extent
of our procedures, and in evaluating the effect of misstatements, both
individually and in the aggregate, on the financial statements as a whole.
US$70m
(FY22: US$61m)
Materiality for the Group financial statements as a whole
What we mean
A quantitative reference for the purpose of planning and performing our audit.
Basis for determining materiality and judgments applied
Materiality for the Group financial statements as a whole was set at US$70m
(FY22: US$61m). This was determined with reference to a benchmark of
normalised PBTCO.
Consistent with FY22, we determined that PBTCO remains the appropriate
benchmark for the Group considering the sector in which the Group operates,
its ownership and financing structure, and the focus of users of the financial
statements. We normalised this by adding back adjustments that do not
represent the normal, continuing operations. The items we adjusted for were
the significant impairment charge of goodwill (US$179m) and restructuring
charges associated with the significant programme (US$53m) as disclosed
in note 15 (FY22: no adjustments). As such, we based our Group materiality
on Group normalised PBTCO of US$1,406m (FY22: PBTCO of US$1,447m).
Our Group materiality of US$70m was determined by applying a percentage
to the normalised PBTCO. When using a benchmark of normalised PBTCO to
determine overall materiality, KPMG’s approach for listed entities considers
a guideline range 3% – 5% of the measure. In setting overall Group materiality,
we applied a percentage of 5.0% (FY22: 4.2%) to the benchmark.
Materiality for the Parent Company financial statements as a whole was set
at US$25m (FY22: US$25m), determined with reference to a benchmark of
Parent Company total assets, of which it represents 0.1% (FY22: 0.1%).
In addition to representing 5.0% (FY22: 4.2%) of normalised PBTCO, the overall materiality for the Group financial statements of US$70m (FY22: US$61m)
compares as follows to the main financial statement caption amounts:
Total Revenue
Total Assets
Net Assets
FY23
FY22
FY23
FY22
FY23
FY22
Financial statement caption
US$6,619m
US$6,288m
US$10,864m
US$10,894m
US$3,964m
US$4,007m
Group Materiality as % of caption
1.1%
1.0%
0.6%
0.6%
1.8%
1.5%
Independent auditor’s report
continued
US$53m
(FY22: US$46m)
Performance materiality
What we mean
Our procedures on individual account balances and disclosures were
performed to a lower threshold, performance materiality, so as to reduce to
an acceptable level the risk that individually immaterial misstatements in
individual account balances add up to a material amount across the financial
statements as a whole.
Basis for determining performance materiality and judgments applied
We have considered performance materiality at a level of 75% (FY22: 75%)
of materiality for Experian plc’s Group financial statements as a whole to be
appropriate.
The Parent Company performance materiality was set at US$19m (FY22:
US$19m), which equates to 75% (FY22: 75%) of materiality for the Parent
Company financial statements as a whole.
We applied this percentage in our determination of performance materiality
because we did not identify any factors indicating an elevated level of risk.
US$3.5m
(FY22: US$3.0m)
Audit misstatement posting threshold
What we mean
This is the amount below which identified misstatements are considered to
be clearly trivial from a quantitative point of view. We may become aware of
misstatements below this threshold which could alter the nature, timing and
scope of our audit procedures, for example if we identify smaller
misstatements which are indicators of fraud.
This is also the amount above which all misstatements identified are
communicated to Experian plc’s Audit Committee..
Basis for determining the audit misstatement posting threshold and
judgments applied
We set our audit misstatement posting threshold at 5% (FY22: 5%) of our
materiality for the Group financial statements. We also report to the Audit
Committee any other identified misstatements that warrant reporting on
qualitative grounds.
Experian plc
Financial statements
158
7. The scope of our audit
Group scope
What we mean
How the Group audit team determined the procedures to be performed across
the Group.
The Group has 198 (FY22: 231) reporting components. In order to determine
the work performed at the reporting component level, we identified those
components which we considered to be of individual financial significance,
those which were significant due to risk and those remaining components on
which we required procedures to be performed to provide us with the
evidence we required in order to conclude on the Group financial statements
as a whole.
We determined individually financially significant components as those
contributing at least 10% (FY22: 5%) of Group revenue or Group total assets.
We selected Group revenue and Group total assets because these are the
most representative of the relative size of the components. We identified three
(FY22: three) components as individually financially significant components
and full scope audits were performed on these components by component
auditors (KPMG member firms). The work on the Parent Company was
performed by the Group team.
The remaining 9% (FY22: 11%) of total Group revenue, 15% (FY22: 10%) of total
profits and losses that made up Group profit before tax and 10% (FY22: 10%)
of total Group assets is represented by 195 (FY22: 228) reporting components,
none of which individually represented more than 2% (FY22: 3%) of any of total
Group revenue, total profits and losses that made up Group profit before tax or
total Group assets. For these residual components, we performed analysis at
an aggregated Group level to re-examine our assessment that there were no
significant risks of material misstatement within these.
The components within the scope of our work accounted for the percentages
included in Item 2 – Group scope. The materiality levels applied to the audit of
these components of Experian plc are set out below:
Scope
Number of components
Range of materiality
applied
Full scope audit
3 (FY22: 3)
US$21m – US$52m
(FY22: US$13m – US$45m)
The Group operates five shared service centres in the UK, USA, Malaysia,
Costa Rica and Bulgaria, the outputs of which are included in the financial
information of the reporting components they service and therefore they are
not separate reporting components. Each of the service centres is subject to
specified risk-focused audit procedures, predominantly the testing of
transaction processing and review controls. Additional procedures are
performed at certain reporting components to address the audit risks not
covered by the work performed over the shared service centres.
The Group audit team also performed testing of general controls over IT
systems and automated process controls on behalf of the components
because of the use of one Group-wide IT system in use at all in-scope
components. The Group team communicated the results of these procedures
to the component teams. The Group team also performed procedures on
treasury related balances because these operations are managed centrally
and on the goodwill impairment charge excluded from normalised Group
profit before tax.
The Group team instructed component auditors as to the significant areas to
be covered, including the relevant risks detailed above and the information to
be reported back. The Group team approved the component materiality levels,
as detailed in the table above, having regard to the mix of size and risk profile
of the Group across the components.
We were able to rely upon the Group's internal control over financial reporting
in several areas of our audit, where our controls testing supported this
approach, which enabled us to reduce the scope of our substantive audit work;
in the other areas the scope of the audit work performed was fully substantive.
Group audit team oversight
What we mean
The extent of the Group audit team’s involvement in component audits.
In working with component auditors, we:
a
Held planning calls and visited all components in person to discuss the
significant areas of the audit relevant to the components, including the key
audit matters in respect of litigation and contingent liabilities.
a
Issued Group audit instructions to component auditors on the scope of their
work, including specifying the minimum procedures to perform in their
audit of significant risk areas, including litigation and contingent liabilities,
management override of controls and revenue recognition.
a
Held risk assessment update discussions with all component audit teams
before the commencement of the final phases of the audit led by the Group
engagement partner.
a
Organised regular video conferences with the component teams as the
audit progressed to understand and challenge the audit approach. At these
meetings, the findings reported to the Group team were discussed in more
detail, and any further work required by the Group team was then
performed by the component audit teams.
a
Inspected the component audit teams’ key work papers (using remote
technology capabilities) to evaluate the quality of execution of the audits of
the components, with a particular focus on work related to key audit
matters and significant risks.
159
Experian plc
Annual Report 2023
Financial statements
8. Other information in the Annual Report and Accounts
The directors are responsible for the other information presented in the Annual Report together with the financial statements. Our opinion on the
financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any
form of assurance conclusion thereon.
All other information
Our responsibility
Our responsibility is to read the other information and, in doing so, consider whether, based on our
financial statements audit work, the information therein is materially misstated or inconsistent with the
financial statements or our audit knowledge.
Our reporting
Based solely on that work we have not identified
material misstatements or inconsistencies in the
other information.
Report on Directors’ remuneration
Our responsibility
In addition to our audit of the financial statements, the directors have engaged us to audit the information
in the Report on Directors’ Remuneration that is described as having been audited, which the directors
have decided to prepare as if the Company were required to comply with the requirements of Schedule 8
to The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (S.I.
2008 No. 410) made under the UK Companies Act 2006.
Our reporting
In our opinion the part of the Report on Directors’
Remuneration to be audited has been properly
prepared in accordance with the UK Companies
Act 2006, as if those requirements applied to the
Company.
Corporate governance disclosures
Our responsibility
We are required to perform procedures to identify whether there is a material inconsistency between the
financial statements and our audit knowledge, and:
a
the directors’ statement that they consider that the annual report and financial statements taken as a
whole is fair, balanced and understandable, and provides the information necessary for shareholders to
assess the Group’s position and performance, business model and strategy;
a
the section of the annual report describing the work of the Audit Committee, including the significant
issues that the Audit Committee considered in relation to the financial statements, and how these
issues were addressed; and
a
the section of the annual report that describes the review of the effectiveness of the Group’s risk
management and internal control systems.
Our reporting
Based on those procedures, we have concluded
that each of these disclosures is materially
consistent with the financial statements and our
audit knowledge.
We are also required to review the part of the Corporate Governance Report relating to the Group’s
compliance with the provisions of the UK Corporate Governance Code specified by the Listing Rules for our
review.
We have nothing to report in this respect.
Other matters on which we are required to report by exception
Our responsibility
Under the Companies (Jersey) Law 1991, we are required to report to you if, in our opinion:
a
proper accounting records have not been kept by the Parent Company, or proper returns adequate for
our audit have not been received from branches not visited by us; or
a
the Parent Company financial statements are not in agreement with the accounting records and
returns; or
a
we have not received all the information and explanations we require for our audit.
Our reporting
We have nothing to report in these respects.
Independent auditor’s report
continued
Experian plc
Financial statements
160
9. Respective responsibilities
Directors’ responsibilities
As explained more fully in their statement set out on page 148, the
directors are responsible for: the preparation of the financial statements
including being satisfied that they give a true and fair view; such internal
control as they determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether
due to fraud or error; assessing the Group and Parent Company’s ability to
continue as a going concern, disclosing, as applicable, matters related to
going concern; and using the going concern basis of accounting unless
they either intend to liquidate the Group or the Parent Company or to
cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue our opinion in an auditor’s
report. Reasonable assurance is a high level of assurance, but does not
guarantee that an audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in
aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial statements.
A fuller description of our responsibilities is provided on the FRC’s website
at
www.frc.org.uk/auditorsresponsibilities.
The Company will be including these financial statements in an annual
financial report prepared using the single electronic reporting format
specified in the TD ESEF Regulation. This auditor’s report provides no
assurance over whether the annual financial report has been prepared
in accordance with that format.
10. The purpose of our audit work and to whom we owe
our responsibilities
This report is made solely to the Company’s members, as a body, in
accordance with Article 113A of the Companies (Jersey) Law 1991 and
the terms of engagement by the Company. Our audit work has been
undertaken so that we might state to the Company’s members those
matters we are required to state to them in an auditor’s report, and the
further matters we are required to state to them in accordance with the
terms agreed with the Company, and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company’s members, as a body,
for our audit work, for this report, or for the opinions we have formed.
Zulfikar Walji (Senior Statutory Auditor)
for and on behalf of KPMG LLP
Chartered Accountants and Recognized Auditor
15 Canada Square
London
E14 5GL
United Kingdom
16 May 2023
161
Experian plc
Annual Report 2023
Financial statements
Notes
2023
2022
Benchmark
1
US$m
Non-
benchmark
2
US$m
Total
US$m
Benchmark
1
US$m
Non-
benchmark
2
US$m
Total
US$m
Revenue
9, 10
Labour costs
12(a)
(2,341 )
(40 )
(2,381 )
(2,302 )
(11 )
(2,313 )
Data and information technology costs
(1,070 )
(1,070 )
(1,000 )
(1,000 )
Amortisation and depreciation charges
13
(482 )
(192 )
(674 )
(484 )
(174 )
(658 )
Marketing and customer acquisition costs
(570 )
(570 )
(503 )
(503 )
Other operating charges
(363 )
(296 )
(659 )
(357 )
(88 )
(445 )
Total operating expenses
(4,826 )
(528 )
(5,354 )
(4,646 )
(273 )
(4,919 )
Net profit on disposal of operations and associates
15(b), 15(c)
Operating profit/(loss)
(528 )
(226 )
Finance income
Finance expense
(137 )
(137 )
(125 )
(125 )
Net finance (expense)/income
16
(124 )
(74 )
(110 )
Share of post-tax (loss)/profit of associates
(18 )
(17 )
(31 )
(28 )
Profit/(loss) before tax
10
(496 )
(88 )
Tax (charge)/credit
17
(434 )
(401 )
(394 )
(296 )
Profit/(loss) for the financial year from continuing operations
(463 )
Profit for the financial year from discontinued operations
18
Profit/(loss) for the financial year
(463 )
Attributable to:
Owners of Experian plc
(465 )
Non-controlling interests
(1 )
Profit/(loss) for the financial year
(463 )
Total Benchmark EBIT
1
10(a)(i)
Group income statement
for the year ended 31 March 2023
Notes
US cents
US cents
US cents
US cents
US cents
US cents
Earnings/(loss) per share
Basic
19(a)
(50.9 )
Diluted
19(a)
(50.5 )
Earnings/(loss) per share from continuing operations
Basic
19(a)
(50.9 )
Diluted
19(a)
(50.5 )
Benchmark PBT per share
1,3
Full-year dividend per share
1
20
1
Total Benchmark EBIT, Benchmark PBT per share and Full-year dividend per share are non-GAAP measures, defined in note 7.
2
The loss before tax for non-benchmark items of US$496 m (2022: US$88 m) comprises a net charge for Exceptional items of US$66 m (2022: net credit of US$21 m) and net charges for other adjustments made to
derive Benchmark PBT of US$430 m (2022: US$109 m). Further information is given in note 15.
3
Benchmark PBT per share is calculated by dividing Benchmark PBT of US$1,670 m (2022: US$1,535 m) by the weighted average number of ordinary shares of 914 million (2022: 914 million). The amount is stated
in US cents per share.
Experian plc
Financial statements
162
2023
US$m
2022
US$m
Profit for the financial year
Other comprehensive (expense)/income
Items that will not be reclassified to profit or loss:
Remeasurement of post-employment benefit assets and obligations (note 36(b))
(23 )
Changes in the fair value of investments revalued through OCI
(58 )
Deferred tax credit/(charge)
(22 )
Items that will not be reclassified to profit or loss
(76 )
Items that are or may be reclassified subsequently to profit or loss:
Currency translation (losses)/gains
(203 )
Cumulative currency translations in respect of divestments reclassified to profit or loss
Fair value loss on cash flow hedge
(38 )
(24 )
Hedging loss reclassified to profit or loss
Items that are or may be reclassified subsequently to profit or loss
(211 )
Other comprehensive (expense)/income for the financial year
1
(287 )
Total comprehensive income for the financial year
Attributable to:
Owners of Experian plc
Non-controlling interests
(3 )
Total comprehensive income for the financial year
1
Amounts reported within Other comprehensive income (OCI) are in respect of continuing operations and, except as reported for post-employment benefit assets and obligations and changes in the fair value of
investments revalued through OCI, there is no associated tax. Currency translation items, not reclassified to profit or loss, are recognised in the hedging or translation reserve within other reserves and in
non-controlling interests. Other items within OCI are recognised in retained earnings.
Group statement of comprehensive income
for the year ended 31 March 2023
163
Experian plc
Annual Report 2023
Financial statements
Notes
2023
US$m
2022
US$m
Non-current assets
Goodwill
21
Other intangible assets
22
Property, plant and equipment
23
Investments in associates
24
Deferred tax assets
37(a)
Post-employment benefit assets
36(a)
Trade and other receivables
25(a)
Financial assets revalued through OCI
31(a)
Other financial assets
31(b)
Current assets
Trade and other receivables
25(a)
Current tax assets
37(b)
Other financial assets
31(b)
Cash and cash equivalents – excluding bank overdrafts
26(a)
Assets classified as held-for-sale
43
Current liabilities
Trade and other payables
27(a)
(1,955 )
(1,744 )
Borrowings
28(a)
(156 )
(57 )
Current tax liabilities
37(b)
(135 )
(109 )
Provisions
38
(56 )
(33 )
Other financial liabilities
31(b)
(6 )
(22 )
(2,308 )
(1,965 )
Liabilities classified as held-for-sale
43
(3 )
(2,311 )
(1,965 )
Net current liabilities
(517 )
(292 )
Total assets less current liabilities
Non-current liabilities
Trade and other payables
27(a)
(186 )
(248 )
Borrowings
28(a)
(3,943 )
(4,039 )
Deferred tax liabilities
37(a)
(223 )
(353 )
Post-employment benefit obligations
36(a)
(39 )
(52 )
Provisions
38
(3 )
(4 )
Financial liabilities revalued through OCI
31(a)
(24 )
Other financial liabilities
31(b)
(171 )
(226 )
(4,589 )
(4,922 )
Net assets
Equity
Called-up share capital
39
Share premium account
39
Retained earnings
40(a)
Other reserves
40(b)
(18,413 )
(18,064 )
Attributable to owners of Experian plc
Non-controlling interests
Total equity
These financial statements were approved by the Board on 16 May 2023 and were signed on its behalf by:
Craig Boundy
Director
Group balance sheet
at 31 March 2023
Experian plc
Financial statements
164
Called-up
share
capital
(Note 39)
US$m
Share
premium
account
(Note 39)
US$m
Retained
earnings
(Note 40)
US$m
Other
reserves
(Note 40)
US$m
Attributable
to owners of
Experian plc
US$m
Non-
controlling
interests
US$m
Total
equity
US$m
At 1 April 2021
(17,978 )
Comprehensive income:
Profit for the financial year
—
—
—
Other comprehensive income for the financial year
—
—
—
Total comprehensive income
—
—
Transactions with owners:
Employee share incentive plans:
– value of employee services
—
—
—
—
– shares issued on vesting
—
—
—
—
– purchase of shares by employee trusts
—
—
—
(61 )
(61 )
—
(61 )
– other vesting of awards and exercises of share options
—
—
(40 )
—
– other payments
—
—
(4 )
—
(4 )
—
(4 )
Purchase of shares held as treasury shares
—
—
—
(111 )
(111 )
—
(111 )
Transactions with non-controlling interests
—
—
—
—
Dividends paid
—
—
(444 )
—
(444 )
(2 )
(446 )
Transactions with owners
—
(333 )
(123 )
(432 )
(2 )
(434 )
At 31 March 2022
(18,064 )
Group statement of changes in equity
for the year ended 31 March 2023
Called-up
share
capital
(Note 39)
US$m
Share
premium
account
(Note 39)
US$m
Retained
earnings
(Note 40)
US$m
Other
reserves
(Note 40)
US$m
Attributable
to owners of
Experian plc
US$m
Non-
controlling
interests
US$m
Total
equity
US$m
At 1 April 2022
(18,064 )
Comprehensive income:
Profit for the financial year
—
—
—
Other comprehensive expense for the financial year
—
—
(76 )
(205 )
(281 )
(6 )
(287 )
Total comprehensive income/(expense)
—
—
(205 )
(3 )
Transactions with owners:
Employee share incentive plans:
– value of employee services
—
—
—
—
– shares issued on vesting
—
—
—
—
– purchase of shares by employee trusts
—
—
—
(45 )
(45 )
—
(45 )
– other vesting of awards and exercises of share options
—
—
(36 )
—
– related tax charge
—
—
(9 )
—
(9 )
—
(9 )
– other payments
—
—
(5 )
—
(5 )
—
(5 )
Purchase of shares held as treasury shares
—
—
—
(149 )
(149 )
—
(149 )
Transactions with non-controlling interests
—
—
(1 )
—
(1 )
—
Dividends paid
—
—
(482 )
—
(482 )
(1 )
(483 )
Transactions with owners
—
(404 )
(144 )
(529 )
—
(529 )
At 31 March 2023
(18,413 )
165
Experian plc
Annual Report 2023
Financial statements
Notes
2023
US$m
2022
US$m
Cash flows from operating activities
Cash generated from operations
41(a)
Interest paid
(126 )
(127 )
Interest received
Dividends received from associates
Tax paid
(525 )
(366 )
Net cash inflow from operating activities – continuing operations
Net cash inflow from operating activities – discontinued operations
18
Net cash inflow from operating activities
Cash flows from investing activities
Purchase of other intangible assets
41(c)
(563 )
(445 )
Purchase of property, plant and equipment
(64 )
(63 )
Sale of property, plant and equipment
Purchase of other financial assets
(15 )
(32 )
Sale of other financial assets
Distributions received on financial assets held as investments
Acquisition of subsidiaries, net of cash acquired
41(d)
(309 )
(736 )
Disposal of investment in associates
15(c)
Repayment of promissory note and interest by associate
24
Disposal of operations
44
(1 )
(1 )
Net cash flows used in investing activities
(948 )
(1,118 )
Cash flows from financing activities
Cash inflow in respect of shares issued
41(e)
Cash outflow in respect of share purchases
41(e)
(194 )
(173 )
Other payments on vesting of share awards
(5 )
(4 )
Settlement of put options held over shares in subsidiaries
41(d)
(133 )
(4 )
Transactions in respect of non-controlling interests
41(d)
(1 )
New borrowings
Repayment of borrowings
(1 )
(583 )
Principal lease payments
(57 )
(57 )
Net payments for cross-currency swaps and foreign exchange contracts
(61 )
(16 )
Net receipts from equity swaps
Dividends paid
(483 )
(446 )
Net cash flows used in financing activities
(722 )
(687 )
Net increase/(decrease) in cash and cash equivalents
(8 )
Cash and cash equivalents at 1 April
Exchange movements on cash and cash equivalents
(25 )
Cash and cash equivalents at 31 March
41(f)
Group cash flow statement
for the year ended 31 March 2023
Experian plc
Financial statements
166
Notes to the Group financial statements
for the year ended 31 March 2023
Experian group of companies (Experian or the Group). Experian is
The Company is incorporated and registered in Jersey as a public
registered office is at 22 Grenville Street, St Helier, Jersey
London Stock Exchange’s Regulated Market and have a Premium Listing.
The Group financial statements are:
a
both UK-adopted International Accounting Standards (UK-IFRS) and
International Financial Reporting Standards (IFRS or IFRSs) as adopted
for use in the European Union (the EU) and IFRS Interpretations
Committee interpretations (together EU-IFRS). The financial statements
also comply with IFRS as issued by the International Accounting
Standards Board (IASB). UK-IFRS, EU-IFRS and IFRS as issued by
the IASB all differ in certain respects from each other, however, the
a
prepared on the going concern basis and under the historical cost
convention, as modified for the revaluation of certain financial assets
and financial liabilities;
a
a
prepared using the principal exchange rates set out in note 11; and
a
designed to voluntarily include disclosures in line with those parts of
the UK Companies Act 2006 applicable to companies reporting under
that law.
There has been no change in the basis of preparation of the Group
financial statements since the Annual Report for the year ended 31 March
The use of critical accounting estimates and management judgment is
required in applying the accounting policies. Areas involving a higher
degree of judgment or complexity, or where assumptions and estimates
are significant to the Group financial statements, are highlighted in note 6.
In adopting the going concern basis for preparing these financial
statements, the directors have considered the business activities, the
principal risks and uncertainties and the other matters discussed in
connection with the Viability statement.
At 31 March 2023, the Group had undrawn committed bank borrowing
facilities of US$2.4bn (2022: US$2.6bn) which have an average remaining
tenor of three years (2022: three years).
The directors believe that the Group and the Company are well placed to
manage their financing and other business risks satisfactorily, and have a
reasonable expectation that the Group and the Company will have
adequate resources to continue their operational existence for at least 12
months from the date of signing these financial statements. The directors
therefore consider it appropriate to adopt the going concern basis of
accounting in preparing the financial statements. In reaching this
conclusion, the directors noted the Group’s strong cash performance in
the year, and its resilience in the face of a viability reverse stress-test
As an information services business, our main environmental impact is
the carbon footprint generated from our operations and value chain. The
majority of our footprint is made up of greenhouse gas emissions from
purchased goods and services, upstream leased assets including
third-party data centres and capital goods, with emissions from our direct
operations making up approximately 5%.
We are committed to reducing our carbon emissions and to becoming
carbon neutral in our own operations by 2030. We continue to develop
our plans to decarbonise our business further and reduce energy
consumption at our data centres and across the Group. We have reduced
our Scope 1 and 2 emissions by 65% since 2019.
We recognise the importance of identifying and effectively managing the
physical and transitional risks that climate change poses to our operations
and consider the impact of climate-related matters, including legislation,
on our business.
The following climate change considerations have been made in
preparing the Group financial statements:
a
The impact in the going concern period or on the viability of the Group
over the next three years, as referenced in the Strategic report.
a
The impact on factors such as residual values, useful lives and
depreciation methods that determine the carrying value of non-current
assets (notes 21 to 23).
a
The impact on forecasts of cash flows used in impairment
assessments for the value-in-use of non-current assets including
goodwill (notes 21 to 23).
a
The impact on forecasts of cash flows used in the fair value
measurement of assets and liabilities (note 32).
a
The impact on post-employment benefit assets (note 36).
At present, there is no material impact of climate-related matters on the
There have been no accounting standards, amendments or interpretations
effective for the first time in these financial statements which have had a
material impact on the financial statements.
The following amendments to standards were effective for Experian from
1 April 2022:
Onerous Contracts – Cost of Fulfilling a Contract
(Amendments to IAS 37)
An onerous contract is one under which the unavoidable costs of meeting
the contract obligations exceed the economic benefits expected to be
received. The amendments to IAS 37 ‘Provisions, Contingent Liabilities and
Contingent Assets’ clarify that the costs relating directly to a contract
consist of both the incremental costs to fulfil it, and an allocation of other
direct costs. As a result of the amendments, certain other directly related
costs are now included when determining the costs of fulfilling onerous
contracts.
The amendments apply prospectively to contracts existing at the date
when the amendments are first applied. The Group has analysed all
contracts existing at 1 April 2022 and determined that none of them
would be identified as onerous applying the refined accounting policy,
consequently there is no impact on opening equity balances at 1 April
2022 as a result of this change.
Reference to the Conceptual Framework – Amendments to
IFRS 3 ‘Business Combinations’
The amendments update a reference to the Conceptual Framework for
Financial Reporting without changing the accounting requirements for
business combinations, and add an exception to the requirement to refer
to the framework to determine what constitutes an asset or a liability.
The amendments also clarify that contingent assets do not qualify for
recognition at the acquisition date.
In accordance with the transitional provisions, the Group applied the
amendments prospectively, to business combinations occurring after
1 April 2022. These amendments had no impact on the Group financial
statements.
Property, Plant and Equipment: Proceeds before Intended
Use (Amendments to IAS 16)
The amendment to IAS 16 ‘Property, Plant and Equipment’ prohibits the
deduction from the cost of property, plant and equipment of proceeds
received from selling items produced while an asset is being prepared for
its intended use. Instead, the proceeds and related cost are recognised in
profit or loss. These amendments had no impact on the Group financial
statements as there were no sales of such items in the year.
Standards issued but not yet effective:
Disclosure of Accounting Policies – Amendments to IAS 1
‘Presentation of Financial Statements’ and IFRS Practice
Statement 2 ‘Making Materiality Judgements’
In February 2021, the IASB issued amendments to IAS 1 and IFRS
Practice Statement 2. The amendments to IAS 1 require disclosure of
material accounting policies rather than significant accounting policies.
The amendments to IFRS Practice Statement 2 provide guidance on how
to apply the concept of materiality to accounting policy disclosures.
The amendments to IAS 1 are applicable for Experian from 1 April 2023.
The Group is currently reviewing its accounting policy disclosures to align
with the amended requirements.
Definition of Accounting Estimates – Amendments to IAS
8 ‘Accounting Policies, Changes in Accounting Estimates
and Errors’
In February 2021, the IASB also issued amendments to IAS 8. The
amendments clarify how to distinguish changes in accounting policies
from changes in accounting estimates and are applicable for Experian
from 1 April 2023. The amendments are not expected to have a material
impact on the Group’s financial statements.
Deferred Tax related to Assets and Liabilities arising from
a Single Transaction – Amendments to IAS 12 ‘Income Taxes’
In May 2021, the IASB issued amendments to IAS 12. The amendments
require deferred tax to be recognised on transactions that, on initial
recognition, give rise to equal amounts of taxable and deductible
temporary differences. The amendments are effective for the Group from
1 April 2023, and it is expected that there will be no impact on retained
earnings given the Group has previously applied the ‘integrally linked’
approach which results in a similar outcome to the amendments.
There are no other new standards, amendments to existing standards,
or interpretations that are not yet effective, that are expected to have
a material impact on the Group’s financial results. Accounting
developments are routinely reviewed by the Group and its financial
The significant accounting policies applied are summarised below. They
have been applied consistently to both years presented. The explanations
of these policies focus on areas where judgment is applied or which are
particularly important in the financial statements. For ease of reference,
the content within this note is arranged as follows:
a
sections (a) to (d) – content that applies generally to the preparation
of these financial statements;
a
sections (e) to (q) – balance sheet policies, to be read in conjunction with
specific notes as indicated;
a
sections (r) to (y) – income statement policies, to be read in conjunction
with specific notes as indicated; and
a
section (z) – the policy and presentation principles adopted for
disclosing segment information, in accordance with IFRS 8 ‘Operating
Segments’.
The Group financial statements incorporate the financial statements
of the Company and its subsidiary undertakings.
Subsidiaries
Subsidiaries are fully consolidated from the date on which control is
transferred to the Group and cease to be consolidated from the date that
the Group no longer has control. All business combinations are accounted
for using the acquisition method.
Intra-Group transactions, balances and unrealised gains on transactions
between Group companies are eliminated on consolidation. Unrealised
losses are also eliminated unless the transaction provides evidence of
an impairment of the asset transferred.
Accounting policies of subsidiaries and segments are consistent with
the policies adopted by the Group for the purposes of the Group’s
consolidation. The Group financial statements incorporate the financial
statements of the Company and its subsidiary undertakings for the year
ended 31 March 2023. A full list of subsidiary undertakings is given in
note T to the Company financial statements.
Interests in associates are accounted for using the equity method.
They are initially recognised at cost, which includes transaction costs.
Subsequent to initial recognition, the Group financial statements include
the Group’s share of the profit or loss and other comprehensive income of
equity-accounted investees, until the date on which significant influence
The non-controlling interests in the Group balance sheet represent the
share of net assets of subsidiary undertakings held outside the Group. The
movement in the year comprises the profit attributable to such interests
together with any dividends paid, movements in respect of corporate
transactions and related exchange differences.
The Group treats transactions with non-controlling interests that do not
result in a loss of control as transactions with equity owners of the Group.
For purchases from non-controlling interests, the difference between any
consideration paid and the relevant share acquired of the carrying value
of the net assets of the subsidiary is recorded in equity. Gains or losses on
disposals to non-controlling interests are also recorded in equity.
Where put option agreements are in place in respect of shares held by
non-controlling shareholders, the liability is stated at the present value of
the expected future payments. Such liabilities are shown as financial
liabilities in the Group balance sheet. The change in the value of such
options in the year is recognised in the Group income statement within net
finance costs, while any change in that value attributable to exchange rate
movements is recognised directly in Other comprehensive income (OCI).
Where put option agreements are in place the Group adopts the
‘anticipated acquisition’ approach, recording the other side of the put
liability against goodwill, with no subsequent profits attributed to
Transactions and balances
Transactions in foreign currencies are recorded in the functional currency
of the relevant Group undertaking at the exchange rate prevailing on the
date of the transaction. At each balance sheet date, monetary assets and
liabilities denominated in foreign currencies are retranslated at the
exchange rate prevailing at the balance sheet date. Translation differences
on monetary items are taken to the Group income statement except when
recognised in OCI, as qualifying net investment hedges or cash flow
hedges. Translation differences on non-monetary financial assets
revalued through OCI are reported as part of the fair value gains or
losses in OCI.
Group undertakings
The results and financial position of Group undertakings whose functional
currencies are not the US dollar are translated into US dollars as follows:
a
Income and expenses are generally translated at the average exchange
rate for the year. Where this average is not a reasonable approximation
of the cumulative effect of the rates prevailing on the transaction dates,
income and expenses are translated at the rates on the dates of the
transactions.
a
Assets and liabilities are translated at the closing exchange rate on
the balance sheet date.
a
All resulting exchange differences are recognised in OCI and as a
separate component of equity.
On consolidation, exchange differences arising from the translation of the
net investment in Group undertakings whose functional currencies are
not the US dollar, and of borrowings and other currency instruments
designated as hedges of such investments, are recognised in OCI to the
extent that such hedges are effective. Tax attributable to those exchange
differences is taken directly to OCI. When such undertakings are sold,
these exchange differences are recognised in the Group income
statement as part of the gain or loss on sale. Goodwill and fair value
adjustments arising on the acquisition of such undertakings are treated
as assets and liabilities of the entities and are translated into US dollars
The fair values of derivative financial instruments and other financial
assets and liabilities are determined by using market data and
established estimation techniques such as discounted cash flow and
option valuation models. The fair value of foreign exchange contracts is
based on a comparison of the contractual and year-end exchange rates.
The fair values of other derivative financial instruments are estimated by
discounting the future cash flows to net present values, using appropriate
Assets that are not subject to amortisation or depreciation are tested
annually for impairment. Assets that are subject to amortisation or
depreciation are reviewed for impairment when there is an indication
that the carrying amount may not be recoverable. Climate-related matters
are considered to identify whether any are an indicator of impairment.
An impairment charge is recognised for the amount by which an asset’s
carrying amount exceeds its recoverable amount, which is the higher
of an asset’s fair value less costs of disposal and value-in-use. For the
purposes of assessing impairment, assets are grouped into cash
generating units (CGUs), determined by the lowest levels for which
Goodwill is stated at cost less any accumulated impairment, where cost is
the excess of the fair value of the consideration payable for an acquisition
over the fair value at the date of acquisition of the Group’s share of
identifiable net assets of a subsidiary or associate acquired. Fair values
are attributed to the identifiable assets, liabilities and contingent liabilities
that existed at the date of acquisition, reflecting their condition at that
date. Adjustments are made where necessary to align the accounting
policies of acquired businesses with those of the Group. Goodwill is not
amortised but is tested annually for impairment, or more frequently if
there is an indication that it may be impaired. An impairment charge is
recognised in the Group income statement for any amount by which the
carrying value of the goodwill exceeds the recoverable amount.
Goodwill is allocated to CGUs and monitored for internal management
purposes by operating segment. The allocation is made to those CGUs
or groups of CGUs that are expected to benefit from the business
combination in which the goodwill arose.
Gains and losses on the disposal of an undertaking take account of the
carrying amount of goodwill relating to the undertaking sold, allocated
where necessary on the basis of relative fair value, unless another
Intangible assets acquired as part of a business combination are
capitalised on acquisition at fair value and separately from goodwill,
if those assets are identifiable (separable or arising from legal rights).
Such assets are referred to as acquisition intangibles in these financial
statements. Amortisation is charged on a straight-line basis as follows:
a
Customer and other relationships – over three to 18 years, based on
management’s estimates of the average lives of such relationships, and
reflecting their long-term nature.
a
Acquired software development – over three to eight years, based on
the asset’s expected life.
a
Marketing-related assets (trademarks and licences) – over their
contractual lives, up to a maximum of 20 years.
a
Marketing-related assets (trade names) – over three to 14 years, based
on management’s expected retention of trade names within the
Other intangibles
Other intangibles are capitalised at cost. Certain costs incurred in the
developmental phase of an internal project are capitalised provided that a
number of criteria are satisfied. These include the technical feasibility of
completing the asset so that it is available for use or sale, the availability
of adequate resources to complete the development and to use or sell the
asset, and how the asset will generate probable future economic benefit.
The cost of such assets with finite useful economic or contractual lives is
amortised on a straight-line basis over those lives. The carrying values
are reviewed for impairment when events or changes in circumstances
indicate that the carrying values may not be recoverable. If impaired, the
carrying values are written down to the higher of fair value less costs of
disposal and value-in-use, which is determined by reference to projected
future income streams using assumptions in respect of profitability and
growth.
Further details on the capitalisation and amortisation policy for the key
asset classifications within other intangibles are:
a
Databases – capitalised databases, which comprise the data purchase
and capture costs of internally developed databases, are amortised
over three to seven years.
a
Computer software (internal use) – computer software licences
purchased for internal use are capitalised on the basis of the costs
incurred to purchase and bring into use the specific software. These
costs are amortised over three to ten years.
a
Computer software (internally generated) – costs directly associated
with producing identifiable and unique software products controlled by
the Group, and that will generate economic benefits beyond one year,
are recognised as intangible assets. These costs are amortised over
three to ten years.
maintaining computer software programs or databases, and configuration
and customisation costs incurred in Software as a Service arrangements,
Purchased items of property, plant and equipment are held at cost less
accumulated depreciation and any impairment in value. Cost includes the
original purchase price of the asset and amounts attributable to bringing
the asset to its working condition for its intended use.
Depreciation is charged on a straight-line basis as follows:
a
Freehold properties – over 50 years.
a
Leasehold improvements to short leasehold properties – over the
remaining period of the lease.
a
Plant and equipment – over three to ten years, according to the asset’s
estimated useful life. Technology-based assets are typically depreciated
over three to five years, motor vehicles over four to five years, with
other infrastructure assets depreciated over five to ten years.
The Group has reviewed the useful lives of its data centres and main plant
and equipment assets to determine if any are affected by climate-related
matters or the commitment to become carbon neutral in our own
Trade receivables and contract assets are initially recognised at fair value
and subsequently measured at this value less loss allowances. Where the
time value of money is material, receivables are then carried at amortised
cost using the effective interest method, less loss allowances.
We apply the IFRS 9 simplified lifetime expected credit loss approach.
Expected credit losses are determined using a combination of historical
experience and forward-looking information. Impairment losses or credits
in respect of trade receivables and contract assets are recognised in the
Cash and cash equivalents include cash in hand, term and call deposits
held with banks and other short-term, highly liquid investments with
original maturities of three months or less. Bank overdrafts are shown
within borrowings in current liabilities in the Group balance sheet.
For the purposes of the Group cash flow statement, cash and cash
We classify our financial assets into the following measurement
categories, with the classification determined on initial recognition
and dependent on the purpose for which such assets are acquired:
a
those subsequently measured at fair value (either through OCI or
through profit or loss), and
a
those measured at amortised cost.
Directly attributable transaction costs are expensed where an asset is
carried at ‘fair value through profit or loss’ (FVPL) and added to the fair
value of the asset otherwise.
Financial assets with embedded derivatives are considered in their
entirety when determining whether their cash flows are solely a payment
of principal and interest.
Debt instruments
Measurement of debt instruments depends on the Group’s business
model for managing the asset and the cash flow characteristics of the
asset. There are three measurement categories into which the Group
classifies debt instruments:
a
Amortised cost: Assets that are held for collection of contractual cash
flows, where those cash flows are solely repayments of principal and
interest, are measured at amortised cost. Interest income from these
financial assets is recognised using the effective interest method. Any
impairment or gain or loss on derecognition is recognised directly in
the Group income statement.
a
Fair value through Other comprehensive income (FVOCI): Assets that
are held both for the collection of contractual cash flows and for their
sale, where the asset’s cash flows solely represent payments of
principal and interest, are measured at FVOCI. Movements in the
carrying amount are taken through OCI, however recognition of
impairment gains or losses, interest income and foreign exchange
gains or losses are recognised in the Group income statement.
a
FVPL: Assets that do not meet the criteria for amortised cost or FVOCI
are measured at FVPL. A gain or loss on a debt instrument that is
subsequently measured at FVPL is recognised in the Group income
statement and presented net within other gains or losses in the period
in which it arises.
Equity instruments
We measure all equity instruments at fair value. Where we have elected to
present fair value gains or losses on equity investments in OCI, there is no
subsequent reclassification of fair value gains or losses to the Group
income statement following the derecognition of the investment.
Dividends from such investments are normally recognised as other
income when the Group’s right to receive payments is established.
Impairment
The loss allowances for financial assets are based on assumptions about
significant increases in credit risk and subsequent risk of default. We use
judgment in making these assumptions and selecting the inputs to the
impairment calculation, based on the Group’s history, existing market
conditions and forward-looking estimates at the end of each reporting
period.
Financial liabilities are measured subsequently at amortised cost using
the effective interest method or at FVPL. Financial liabilities are classified
at FVPL when the financial liability is held for trading, it is a derivative or it
is designated at FVPL on initial recognition. Financial liabilities at FVPL are
measured at fair value, with any net gains or losses arising on changes in
fair value, including any interest expense, recognised in the Group income
statement.
Other financial liabilities are subsequently measured at amortised cost
using the effective interest method. Interest expense, foreign exchange
gains and losses and any gain or loss on derecognition are recognised
in the Group income statement.
The effective interest method is a method of calculating the amortised
cost of a financial liability and of allocating interest expense over the
relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash payments, including all fees that form
an integral part of the effective interest rate, transaction costs and other
The Group uses derivative financial instruments to manage its exposures
to fluctuations in foreign exchange rates, interest rates and certain
obligations relating to share incentive plans, including social security
obligations. Instruments used include interest rate swaps, cross-currency
swaps, foreign exchange contracts and equity swaps. These are
recognised as assets or liabilities as appropriate and are classified as
non-current, unless they mature within one year of the balance sheet
date.
Derivatives are initially recognised at their fair value on the date the
contract is entered into, and are subsequently remeasured at their fair
value. The method of recognising the resulting gain or loss depends on
whether the derivative is designated as a hedging instrument and, if so,
the nature of the hedge relationship.
The Group designates certain derivatives as either fair value hedges or
cash flow hedges. Fair value hedges are hedges of the fair value of a
recognised asset or liability. Cash flow hedges are hedges of highly
probable future foreign currency cash flows. The Group does not currently
enter into net investment hedges.
We document the relationship between hedging instruments and hedged
items, and our risk management objective and strategy for undertaking
hedge transactions, at the hedge inception. We also document our
assessment of whether the derivatives used in hedging meet the hedge
effectiveness criteria set out in IFRS 9. This assessment is performed at
every reporting date throughout the life of the hedge to confirm that the
hedge continues to meet the hedge effectiveness criteria. Hedge
accounting is discontinued when the hedging instrument expires, is sold,
terminated or exercised, or no longer qualifies for hedge accounting.
Amounts payable or receivable in respect of interest rate swaps, together
with the interest differentials reflected in foreign exchange contracts, are
recognised in net finance costs over the period of the contract.
Changes in the fair value of derivatives that are designated and qualify as
fair value hedging instruments are recognised in the Group income
statement, together with any changes in the fair value of the hedged asset
or liability that are attributable to the hedged risk. The ineffective portion
of a fair value hedge is recognised in net finance costs in the Group
income statement.
The effective portion of changes in the fair value of derivatives that are
designated and qualify as cash flow hedging instruments is recognised in
OCI, while any ineffective part is recognised in the Group income
statement. Amounts recorded in OCI are recycled to the Group income
statement in the same period in which the underlying foreign currency
Changes in the fair value of derivative instruments which are used to
manage exposures, but are not part of a documented hedge relationship
under IFRS 9, are recognised immediately in the Group income statement.
Cost and income amounts in respect of derivatives entered into in
connection with social security obligations on employee share incentive
plans, other than amounts of a financing nature, are charged or credited
within labour costs. Other costs and changes in the fair value of such
derivatives are charged or credited within financing fair value
Trade payables and contract liabilities are recognised initially at fair value.
Where the time value of money is material, payables and contract
liabilities are then carried at amortised cost using the effective interest
Borrowings are recognised initially at fair value, net of any transaction
costs incurred. Borrowings are subsequently stated at amortised cost,
except where they are hedged by an effective fair value hedge, in which
case the carrying value is adjusted to reflect the fair value movements
associated with the hedged risk.
Borrowings are classified as non-current to the extent that the Group has
an unconditional right to defer settlement of the liability for at least one
The Group undertakes an assessment of whether a contract is or contains
a lease at its inception. The assessment establishes whether the Group
obtains substantially all the economic benefits from the use of an asset
and whether we have the right to direct its use.
Low-value lease payments are recognised as an expense, on a
straight-line basis over the lease term. For other leases we recognise both
a right-of-use asset and a lease liability at the commencement date of a
lease contract.
The right-of-use asset is initially measured at cost, comprising the initial
amount of the lease liability adjusted for payments made at or before the
commencement date, plus initial direct costs and an estimate of the cost
of any obligation to refurbish the asset or site, less lease incentives.
Subsequently, right-of-use assets are measured at cost less accumulated
depreciation and impairment losses and are adjusted for any
remeasurement of the lease liability. Depreciation is calculated on a
straight-line basis over the shorter of the lease period or the estimated
useful life of the right-of-use asset, which is determined on a basis
consistent with purchased assets (note 5(g)).
The lease term comprises the non-cancellable period of a lease, plus
periods covered by an extension option, if it is reasonably certain to be
exercised, and periods covered by a termination option if it is reasonably
certain not to be exercised.
The lease liability is initially measured at the present value of lease
payments that are outstanding at the commencement date, discounted
at the interest rate implicit in the lease, or if that rate cannot be easily
determined, the Group’s incremental borrowing rate.
Lease payments comprise payments of fixed principal, less any lease
incentives, variable elements linked to an index, guaranteed residuals or
buy-out options that are reasonably certain to be exercised. They include
payments in respect of optional renewal periods where these are
reasonably certain to be exercised or early termination payments where
the lease term reflects such an option.
The lease liability is remeasured when there is a change in future lease
payments arising from a change in an index or rate, if there is a change in
the Group’s estimate of the amount expected to be payable under a
residual value guarantee, or if the Group changes its assessment of
whether it will exercise a purchase, extension or termination option.
When a lease liability is remeasured, a corresponding adjustment is made
to the carrying amount of the right-of-use asset or is recognised in the
Group income statement if the asset is fully depreciated.
The Group presents right-of-use assets within property, plant and
(n) Post-employment benefit assets and obligations
(note 36)
Defined benefit pension arrangements – funded plans
The post-employment benefit assets and obligations recognised in the
Group balance sheet in respect of funded plans comprise the fair value of
plan assets of funded plans less the present value of the related defined
benefit obligation at that date. The defined benefit obligation is calculated
annually by independent qualified actuaries, using the projected unit
credit method.
The present value of the defined benefit obligation is determined by
discounting the estimated future cash outflows, using market yields
on high-quality corporate pound sterling bonds with maturity terms
consistent with the estimated average term of the related pension liability.
Actuarial gains and losses arising from experience adjustments, and
changes in actuarial assumptions, are recognised immediately in the
Group statement of comprehensive income.
The pension cost recognised in the Group income statement comprises
the cost of benefits accrued plus interest on the opening net defined
benefit obligation or asset. Service costs and financing income and
expenses are recognised separately in the Group income statement.
Plan expenses are deducted from the expected return on the plan assets
over the year.
Defined benefit pension arrangements – unfunded plans
Unfunded pension obligations are determined and accounted for
in accordance with the principles used in respect of the funded
arrangements.
Defined contribution pension arrangements
The assets of defined contribution plans are held separately in
independently administered funds. The pension cost recognised in the
Group income statement represents the contributions payable by the
Group to these funds, in respect of the year.
Post-retirement healthcare obligations
Obligations in respect of post-retirement healthcare plans are calculated
annually by independent qualified actuaries, using an actuarial
methodology similar to that for the funded defined benefit pension
arrangements.
Actuarial gains and losses arising from experience adjustments, and
changes in actuarial assumptions, are recognised in the Group statement
of comprehensive income. The cost recognised in the Group income
statement comprises only interest on the obligations.
A provision is recognised when the Group has a present obligation as a
result of a past event, it is probable that an outflow of resources will be
required to settle the obligation, and a reliable estimate can be made of
the amount of the obligation.
The provision is measured at the best estimate of the expenditure required
to settle the obligation at the reporting date, discounted at a pre-tax rate
reflecting current market assessments of the time value of money and
risks specific to the liability. The unwinding of the discount is recognised as
a finance expense in the Group income statement. In making its estimates,
management takes into account the advice of legal counsel.
Restructuring provisions are recognised only when the Group has
approved a detailed formal plan that identifies the business or part of the
business concerned, and the restructuring has commenced or its main
features have been announced to those affected by it. Future operating
The Group has a number of equity-settled, share-based employee
incentive plans. In connection with these, shares in the Company are held
by The Experian plc Employee Share Trust and the Experian UK Approved
All-Employee Share Plan. The assets of these entities mainly comprise
Experian plc shares, which are shown as a deduction from equity at cost.
Shares in the Company purchased and held as treasury shares, in
connection with the above plans and any share purchase programme, are
also shown as a deduction from equity at cost. The par value of shares in
the Company that are purchased and cancelled, in connection with any
share purchase programme, is accounted for as a reduction in called-up
share capital with any cost in excess of that amount being deducted from
Assets and liabilities are classified as held-for-sale when their carrying
amounts are to be recovered or settled principally through a sale
transaction and a sale is considered highly probable. They are stated
at the lower of the carrying amount and fair value less costs to sell.
No depreciation or amortisation is charged in respect of non-current
Revenue is stated net of any sales taxes, rebates and discounts and
reflects the amount of consideration we expect to receive in exchange
for the transfer of promised goods and services.
Total consideration from contracts with customers is allocated to the
performance obligations identified based on their standalone selling price,
and is recognised when those performance obligations are satisfied and
the control of goods or services is transferred to the customer, either over
time or at a point in time.
a
The provision and processing of transactional data is distinguished
between contracts that:
–
provide a service on a per unit basis, where the transfer to the
customer of each completed unit is considered satisfaction of
a single performance obligation. Revenue is recognised on the
transfer of each unit;
–
provide a service to the customer over the contractual term,
normally between one and five years, where revenue is recognised
on the transfer of this service to customers. For the majority of
contracts this means revenue is spread evenly over the contract
term, as customers simultaneously receive and consume the
benefits of the service;
–
require an enhanced service at the start, where revenue is
recognised to reflect the upfront benefit the customer receives and
consumes. Revenue for such contracts is recognised proportionally
in line with the costs of providing the service.
a
Revenue from referral fees for credit products and white-label
partnerships is recognised as transactional revenue.
a
Revenue from transactional batch data arrangements that include an
ongoing update service is apportioned across each delivery to the
customer and is recognised when the delivery is complete, and control
of the batch data passes to the customer. Performance obligations are
determined based on the frequency of data refresh: one-off, quarterly,
monthly, or real-time.
a
Subscription and membership fees for continuous access to a service
are recognised over the period to which they relate, usually 1, 12 or 24
months. Customers simultaneously receive and consume the benefits
of the service; therefore, revenue is recognised evenly over the
subscription or membership term.
a
Revenue for one-off credit reports is recognised when the report is
delivered to the consumer.
a
Software licence and implementation services are primarily accounted
for as a single performance obligation, with revenue recognised when
the combined offering is delivered to the customer. Contract terms
normally vary between one and five years. These services are
distinguished between:
–
Experian-hosted solutions, where the customer has the right to
access a software solution over a specified time period. Customers
simultaneously receive and consume the benefits of the service and
revenue is spread evenly over the period that the service is available;
and
–
On-premise software licence arrangements, where the software
solution is installed in an environment controlled by the customer.
The arrangement represents a right to use licence and so the
performance obligation is considered to be fulfilled on delivery
completion, when control of the configured solution is passed to
the customer. Revenue is recognised at that point in time.
a
The delivery of support and maintenance agreements is generally
considered to be a separate performance obligation to provide a
technical support service including minor updates. Contract terms are
often aligned with licence terms. Customers simultaneously receive
and consume the benefits of the service, therefore revenue is spread
evenly over the term of the maintenance period.
a
The provision of distinct standalone consultancy and professional
services is distinguished between:
–
Professional consultancy services where the performance obligation
is the provision of personnel. Customers simultaneously receive and
consume the benefits of the service, and revenue is recognised over
time, in line with hours provided; and
–
The provision of analytical models and analyses, where the
performance obligation is a deliverable, or a series of deliverables,
and revenue is recognised on delivery when control is passed to the
customer.
Sales are typically invoiced in the geographic area in which the customer
is located. As a result, the geographic location of the invoicing undertaking
is used to attribute revenue to individual countries.
Accrued income balances, which represent the right to consideration in
exchange for goods or services that we have transferred to a customer,
are assessed as to whether they meet the definition of a contract asset:
a
When the right to consideration is conditional on something other than
the passage of time, a balance is classified as a contract asset. This
arises where there are further performance obligations to be satisfied
as part of the contract with the customer and typically includes
balances relating to software licensing contracts.
a
When the right to consideration is conditional only on the passage of
time, the balance does not meet the definition of a contract asset and
is classified as an unbilled receivable. This typically arises where the
timing of the related billing cycle occurs in a period after the
performance obligation is satisfied.
Costs incurred prior to the satisfaction or partial satisfaction of a
performance obligation are first assessed to see if they are within the
scope of other standards. Where they are not, certain costs are recognised
as an asset providing they relate directly to a contract (or an anticipated
contract), generate or enhance resources that will be used in satisfying
(or to continue to satisfy) performance obligations in the future and are
expected to be recovered from the customer. Costs which meet these
criteria are deferred as contract costs and these are amortised on a
systematic basis consistent with the pattern of transfer of the related
goods or services.
a
Costs to obtain a contract predominantly comprise sales commissions
costs.
a
Costs to fulfil a contract predominantly comprise labour costs directly
relating to the implementation services provided.
If evidence emerges that a contract is loss making, no further costs are
capitalised and any related contract assets are reviewed for impairment.
A provision for future losses is established when the unavoidable costs
of the contract exceed the economic benefits expected to be received.
Contract liabilities arise when we have an obligation to transfer future
goods or services to a customer for which we have received
consideration, or the amount is due from the customer, and include both
Operating charges are reported by nature in the Group income statement,
reflecting the Group’s cost-management control structure.
Details of the types of charges within labour costs in respect of share
incentive plans are set out in note 5(v). Those for post-employment
benefits are set out in note 5(n).
Details of the Group’s amortisation and depreciation policy are given in
notes 5(f), 5(g) and 5(m). The principles upon which impairment charges
of tangible and intangible assets are recognised are set out in notes 5(d),
of debt are capitalised and amortised over the expected life of the
borrowing, using the effective interest method. All other borrowing costs
are charged in the Group income statement in the year in which they are
Amounts payable or receivable in respect of interest rate swaps are taken
to net finance costs over the periods of the contracts, together with the
interest differentials reflected in foreign exchange contracts.
Details of the nature of movements in the fair value of derivatives which
are reported as financial fair value remeasurements are included in note
5(j). The change in the year in the present value of put option agreements,
in respect of shares held by non-controlling shareholders, is recognised
The tax charge or credit for the year is recognised in the Group income
statement, except for tax on items recognised in OCI or directly in equity.
Current tax is calculated on the basis of the tax laws substantively enacted
at the balance sheet date in the countries where the Group operates.
Current tax assets and liabilities are offset where there is a legally
enforceable right of offset.
Uncertain tax positions are considered on an individual basis. Where
management considers it probable that an additional outflow will result
from any given position, a provision is made. Such provisions are
measured using management’s best estimate of the most likely outcome.
the tax bases of assets and liabilities and their carrying amounts in the
Group financial statements. Deferred tax is not recognised on taxable
temporary differences arising on the initial recognition of goodwill.
Deferred tax is not accounted for when it arises from the initial recognition
of an asset or liability in a transaction, other than a business combination,
that at the time of the transaction affects neither accounting nor taxable
profit or loss. Deferred tax assets and liabilities are calculated at the tax
rates that are expected to apply when the asset is realised or the liability
settled, based on the tax rates and laws that have been enacted or
substantively enacted by the balance sheet date in the countries where
the Group operates.
Deferred tax assets are recognised in respect of tax losses carried
forward and other temporary differences, to the extent that it is probable
that the related tax benefit will be realised through future taxable profits.
Deferred tax is provided on temporary differences arising on investments
in subsidiaries and associates, except where the Group controls the timing
of the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred
tax assets and liabilities are offset where there is a legally enforceable
right to offset current tax assets and liabilities and where they relate to
The fair value of share incentives granted in connection with the Group’s
equity-settled, share-based employee incentive plans is recognised as
an expense on a straight-line basis over the vesting period. Fair value is
measured using whichever of the Black-Scholes model, Monte Carlo
model or closing market price is most appropriate. The Group takes into
account the best estimate of the number of awards and options expected
to vest and revises such estimates at each balance sheet date.
Non-market performance conditions are included in the vesting
estimates. Market-based performance conditions are included in the
The initially recorded cost of any acquisition includes a reasonable
estimate of the fair value of any contingent amounts expected to be
payable in the future. Any cost or benefit arising when such estimates are
revised is recognised in the Group income statement (note 15).
Where part or all of the amount of disposal consideration is contingent
on future events, the disposal proceeds initially recorded include a
reasonable estimate of the value of the contingent amounts expected
to be receivable and payable in the future. The proceeds and profit or
loss on disposal are adjusted when revised estimates are made, with
corresponding adjustments made to receivables and payables as
appropriate, until the ultimate outcome is known and the related
A discontinued operation is a component of the Group’s business that
represents a separate geographic area of operation or a separate major
line of business. Classification as a discontinued operation occurs upon
disposal or earlier, if the operation meets the criteria to be classified as
held-for-sale. Discontinued operations are presented in the Group income
statement as a separate line and are shown net of tax.
When an operation is classified as a discontinued operation, comparatives
in the Group income statement and the Group statement of
comprehensive income are re-presented as if the operation had been
(note 10)
We are organised into, and managed on a worldwide basis through, the
following five operating segments, which are based on geographic areas
and supported by central functions:
a
North America
a
Latin America
a
UK and Ireland
a
Europe, Middle East and Africa (EMEA) and
a
Asia Pacific.
The chief operating decision maker makes operating decisions, allocates
resources and assesses the performance of these operating segments on
the basis of Benchmark EBIT, as defined in note 7.
The ‘All other segments’ category required to be disclosed has been
captioned as EMEA/Asia Pacific in these financial statements. This
combines information in respect of the EMEA and Asia Pacific segments,
as neither of these operating segments is individually reportable, on the
basis of their share of the Group’s revenue, reported profit or loss, and
assets.
We separately present information equivalent to segment disclosures in
respect of the costs of our central functions, under the caption ‘Central
Activities’, as management believes that this information is helpful to
users of the financial statements. Costs reported for Central Activities
include costs arising from finance, treasury and other global functions.
Inter-segment transactions are entered into under the normal
commercial terms and conditions that would be available to third parties.
Such transactions do not have a material impact on the Group’s results.
Segment assets consist primarily of property, plant and equipment,
intangible assets including goodwill, derivatives designated as hedges of
future commercial transactions, contract assets and receivables. They
exclude tax assets, cash and cash equivalents, and derivatives designated
as hedges of borrowings. Segment liabilities comprise operating and
contract liabilities, including derivatives designated as hedges of future
commercial transactions and lease obligations. They exclude tax liabilities,
borrowings, other than lease obligations, and related hedging derivatives.
Net assets reported for Central Activities comprise corporate head office
assets and liabilities, including certain post-employment benefit assets
and obligations, and derivative assets and liabilities. Capital expenditure
comprises additions to property, plant and equipment and intangible
assets, other than additions through business combinations or to
right-of-use assets.
Information required to be presented also includes analysis of the Group’s
revenues by groups of service lines. This is supplemented by voluntary
disclosure of the profitability of those groups of service lines. For ease of
reference, we use the term ‘business segments’ when discussing the
results of groups of service lines. Our two business segments, details of
which are given in the Strategic report section of this Annual Report, are:
a
Business-to-Business
a
Consumer Services.
The North America, Latin America and the UK and Ireland operating
segments derive revenues from both of the Group’s business segments.
The EMEA and Asia Pacific segments currently do not derive revenue
from the Consumer Services business segment.
Reportable segment information for the full year provided to the chief
judgments
(a) Critical accounting estimates and assumptions
In preparing these financial statements, management is required to make
estimates and assumptions that affect the reported amount of revenues,
expenses, assets, liabilities and the disclosure of contingent liabilities. The
resulting accounting estimates, which are based on management’s best
judgment at the date of these financial statements, will seldom equal the
subsequent actual amounts. The estimates and assumptions that have a
significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial year are summarised
below, with further information provided within the Financial review in the
Strategic report. Revenue recognition is excluded from this summary on
the grounds that the policy adopted in this area is sufficiently objective.
Goodwill (note 21)
The Group tests goodwill for impairment annually, or more frequently if
there is an indication that it may be impaired. The recoverable amount of
each group of CGUs is generally determined on the basis of value-in-use
calculations, which require the use of cash flow projections based on
financial forecasts, looking forward five years. Three-year growth
expectations are reviewed as part of the annual strategic planning
process and forecasts for years beyond this are extrapolated based on
management’s best estimates. Management determines budgeted profit
margin based on past performance and its expectations for the market’s
development. Cash flows after the five year forecast period are
extrapolated using estimated growth rates that do not exceed the
long-term average growth rate for the CGU’s markets. The discount rates
used reflect the Group’s pre-tax weighted average cost of capital (WACC),
as adjusted for region-specific risks and other factors. Discount rates
have increased during the year ended 31 March 2023 primarily as a result
of increases in 20-year US Treasury yields, which are used as the
estimated risk-free rates in the cost of capital calculations.
Post-employment benefits (note 36)
Accounting for the Group’s post-employment benefit obligations requires
management to exercise judgment and make a number of assumptions
about uncertain events. The key sources of estimation uncertainty are the
discount rate applied to future cash flows, the expected rate of future
inflationary increases and the life expectancy of the schemes’ members.
The estimates in respect of these critical assumptions are made after
seeking advice from independent qualified actuaries. The discount rate,
inflation rate and mortality assumptions may have a material effect in
determining the defined benefit pension obligations and the amounts
reported in the Group financial statements.
Information regarding actuarial assumptions and sensitivities to changes
(b) Critical judgments
In applying the Group’s accounting policies, management has made
judgments that have a significant effect on the amounts recognised in the
Group financial statements and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to estimates are recognised prospectively.
The most significant of these judgments are in respect of intangible
assets and contingencies:
Intangible assets
Certain costs incurred in the developmental phase of an internal project,
which include the development of databases, internal use software and
internally generated software, are capitalised as intangible assets if a
number of criteria are met. Management has made judgments and
assumptions when assessing whether a project meets these criteria, and
on measuring the costs and the economic life attributed to such projects.
On acquisition, specific intangible assets are identified and recognised
separately from goodwill and then amortised over their estimated useful
lives. These include items such as brand names and customer lists, to
which value is first attributed at the time of acquisition. The capitalisation
of these assets and the related amortisation charges are based on
judgments about the value and economic life of such items.
The economic lives of intangible assets are estimated at between three
and ten years for internal projects and between two and 20 years for
acquisition intangibles. Amortisation methods, useful lives and residual
values are reviewed at each reporting date and adjusted if appropriate.
Further details of the amounts of, and movements in, such assets are
given in note 22.
Contingencies
In the case of pending and threatened litigation claims, management has
formed a judgment as to the likelihood of ultimate liability. No liability has
been recognised where the likelihood of any loss arising is possible rather
statements
As detailed below, the Group has identified and defined certain measures
that it uses to understand and manage its performance. The measures
are not defined under IFRS and they may not be directly comparable with
other companies’ adjusted performance measures. These non-GAAP
measures are not intended to be a substitute for any IFRS measures of
performance but management considers them to be key measures used
within the business for assessing the underlying performance of the
Group’s ongoing businesses.
Management no longer uses Benchmark PBT per share as a measure for
assessing underlying performance; this definition has therefore been
removed from our non-GAAP measures.
As a result of our restructuring programme in EMEA/Asia Pacific we have
refined the definition of Exceptional items to include onerous global
support costs associated with the closure of significant operations, to aid
assessment of underlying operating performance as such costs are
eliminated through restructuring activity.
(a) Benchmark profit before tax (Benchmark PBT)
(note 10(a)(i))
Benchmark PBT is disclosed to indicate the Group’s underlying
profitability. It is defined as profit before amortisation and impairment of
acquisition intangibles, impairment of goodwill, acquisition expenses,
adjustments to contingent consideration, Exceptional items, financing fair
value remeasurements, tax (and interest thereon) and discontinued
operations. It includes the Group’s share of continuing associates’
Benchmark post-tax results.
An explanation of the basis on which we report Exceptional items is
provided in note 7(l). Other adjustments, in addition to Exceptional items,
made to derive Benchmark PBT are explained as follows:
a
Charges for the amortisation and impairment of acquisition intangibles
are excluded from the calculation of Benchmark PBT because these
charges are based on judgments about their value and economic life
and bear no relation to the Group’s underlying ongoing performance.
Impairment of goodwill is similarly excluded from the calculation of
Benchmark PBT.
a
Acquisition and disposal expenses (representing the incidental costs
of acquisitions and disposals, one-time integration costs and other
corporate transaction expenses) relating to successful, active or
aborted acquisitions and disposals are excluded from the definition
of Benchmark PBT as they bear no relation to the Group’s underlying
ongoing performance or to the performance of any acquired
businesses. Adjustments to contingent consideration are similarly
excluded from the definition of Benchmark PBT.
a
Charges and credits for financing fair value remeasurements within
finance expense in the Group income statement are excluded from the
definition of Benchmark PBT. These include retranslation of intra-Group
funding, and that element of the Group’s derivatives that is ineligible for
hedge accounting, together with gains and losses on put options in
respect of acquisitions. Amounts recognised generally arise from
market movements and accordingly bear no direct relation to the
Group’s underlying performance.
(b) Benchmark earnings before interest and tax (Benchmark
EBIT) and margin (Benchmark EBIT margin) (note 10(a)(i))
Benchmark EBIT is defined as Benchmark PBT before the net interest
expense charged therein and accordingly excludes Exceptional items as
defined below. Benchmark EBIT margin is Benchmark EBIT from ongoing
activities expressed as a percentage of revenue from ongoing activities.
(c) Benchmark earnings before interest, tax, depreciation
and amortisation (Benchmark EBITDA)
Benchmark EBITDA is defined as Benchmark EBIT before the depreciation
and amortisation charged therein (note 13).
(d) Exited business activities
Exited business activities are businesses sold, closed or identified for
closure during a financial year. These are treated as exited business
activities for both revenue and Benchmark EBIT purposes. The results of
exited business activities are disclosed separately with the results of the
prior period re-presented in the segmental analyses as appropriate. This
measure differs from the definition of discontinued operations in IFRS 5.
(e) Ongoing activities
The results of businesses trading at 31 March 2023, that are not disclosed
as exited business activities, are reported as ongoing activities.
(f) Constant exchange rates
To highlight our organic performance, we discuss our results in terms
of growth at constant exchange rates, unless otherwise stated. This
represents growth calculated after translating both years’ performance
at the prior year’s average exchange rates.
(g) Total growth (note 10(a)(ii))
This is the year-on-year change in the performance of our activities at
actual exchange rates. Total growth at constant exchange rates removes
the translational foreign exchange effects arising on the consolidation of
our activities and comprises one of our measures of performance at
constant exchange rates.
(h) Organic revenue growth (note 10(a)(ii))
This is the year-on-year change in the revenue of ongoing activities,
translated at constant exchange rates, excluding acquisitions until the first
anniversary of their consolidation.
(i) Benchmark earnings and Total Benchmark earnings
(note 19)
Benchmark earnings comprises Benchmark PBT less attributable tax and
non-controlling interests. The attributable tax for this purpose excludes
significant tax credits and charges arising in the year which, in view of
their size or nature, are not comparable with previous years, together with
tax arising on Exceptional items and on other adjustments made to derive
Benchmark PBT. Benchmark PBT less attributable tax is designated as
Total Benchmark earnings.
(j) Benchmark earnings per share (Benchmark EPS)
(note 19)
Benchmark EPS comprises Benchmark earnings divided by the weighted
average number of issued ordinary shares, as adjusted for own shares
held.
(k) Benchmark tax charge and rate (note 17(b)(ii))
The Benchmark tax charge is the tax charge applicable to Benchmark
PBT. It differs from the tax charge by tax attributable to Exceptional items
and other adjustments made to derive Benchmark PBT, and exceptional
tax charges. A reconciliation is provided in note 17(b)(ii) to these financial
statements. The Benchmark effective rate of tax is calculated by dividing
the Benchmark tax charge by Benchmark PBT.
The separate reporting of Exceptional items gives an indication of the
Group’s underlying performance. Exceptional items include those arising
from the profit or loss on disposal of businesses, closure costs of
significant operations (including onerous global support costs associated
with these operations), costs of significant restructuring programmes and
other financially significant one-off items. All other restructuring costs are
charged against Benchmark EBIT, in the segments in which they are
(m) Full-year dividend per share (note 20)
Full-year dividend per share comprises the total of dividends per share
announced in respect of the financial year.
(n) Benchmark operating and Benchmark free cash flow
Benchmark operating cash flow is Benchmark EBIT plus amortisation,
depreciation and charges in respect of share-based incentive plans, less
capital expenditure net of disposal proceeds and adjusted for changes in
working capital, principal lease payments and the Group’s share of the
Benchmark profit or loss retained in continuing associates. Benchmark
free cash flow is derived from Benchmark operating cash flow by
excluding net interest, tax paid in respect of continuing operations and
dividends paid to non-controlling interests.
(o) Cash flow conversion
Cash flow conversion is Benchmark operating cash flow expressed as a
percentage of Benchmark EBIT.
(p) Net debt and Net funding (note 29)
Net debt is borrowings (and the fair value of derivatives hedging
borrowings) excluding accrued interest, less cash and cash equivalents
and other highly liquid bank deposits with original maturities greater than
three months. Net funding is borrowings (and the fair value of the effective
portion of derivatives hedging borrowings) excluding accrued interest,
less cash held in Group Treasury.
(q) Return on capital employed (ROCE) (note 10(a)(iii))
ROCE is defined as Benchmark EBIT less tax at the Benchmark rate
divided by a three-point average of capital employed, in continuing
operations, over the year. Capital employed is net assets less
non-controlling interests and right-of-use assets, further adjusted to add
(a) Financial risk factors
The Group’s activities expose it to a variety of financial risks. These are
market risk, including foreign exchange risk and interest rate risk, credit
risk, and liquidity risk. These risks are unchanged from those reported in
the 2022 Annual Report. The numeric disclosures in respect of financial
risks are included within later notes to the financial statements, to provide
a more transparent link between financial risks and results.
Financial risks represent part of the Group’s risks in relation to its strategy
and business objectives. There is a full discussion of the most significant
risks in the Risk management section of this Annual Report. The Group’s
financial risk management focuses on the unpredictability of financial
markets and seeks to minimise potentially adverse effects on the Group’s
financial performance. The Group seeks to reduce its exposure to financial
risks and uses derivative financial instruments to hedge certain risk
exposures. Such derivative financial instruments are also used to manage
the Group’s borrowings so that amounts are held in currencies broadly in
the same proportion as the Group’s main earnings. However, the Group
does not, nor does it currently intend to, borrow in the Brazilian real or the
Colombian peso.
The Group also ensures surplus funds are prudently managed and
controlled.
The Group is exposed to foreign exchange risk from future commercial
transactions, recognised assets and liabilities and investments in, and
loans between, Group undertakings with different functional currencies.
The Group manages such risk, primarily within undertakings whose
functional currencies are the US dollar, by:
a
entering into forward foreign exchange contracts in the relevant
currencies in respect of investments in entities with functional
currencies other than the US dollar, whose net assets are exposed to
foreign exchange translation risk;
a
swapping the proceeds of certain bonds issued in pounds sterling and
euros into US dollars;
a
managing the liquidity of Group undertakings in the functional currency
of those undertakings by using an in-house banking structure and
hedging any remaining foreign currency exposures with forward
foreign exchange contracts;
a
denominating internal loans in relevant currencies, to match the
currencies of assets and liabilities in entities with different functional
currencies; and
a
using forward foreign exchange contracts to hedge certain future
commercial transactions.
The principal transaction exposures are to the pound sterling and the
euro. An indication of the sensitivity to foreign exchange risk is given in
note 11.
Interest rate risk
The Group’s interest rate risk arises principally from components of its
Net debt that are at variable rates.
The Group has a policy of normally maintaining between 50% and 100%
of Net funding at rates that are fixed for more than six months. The Group
manages its interest rate exposure by:
a
using fixed and floating rate borrowings, interest rate swaps and
cross-currency interest rate swaps to adjust the balance between the
two; and
a
mixing the duration of borrowings and interest rate swaps to smooth
the impact of interest rate fluctuations.
Managing interest rate benchmark reform and associated risks
A fundamental reform of interest rate benchmarks is taking place globally,
involving the replacement of many London interbank offered rates
(LIBOR). Historically our main floating rate borrowings and derivatives
have been indexed to pound sterling and US dollar LIBOR. We have
amended our revolving credit facilities and other financial instruments, so
that pound sterling exposures are now indexed to Sterling Overnight Index
Average (SONIA) rate, and US dollar exposures to the Secured Overnight
Derivatives
The Group has transacted cross-currency swaps, interest rate swaps and
equity swaps for risk management purposes. As at 31 March 2022, these
swaps had floating legs that were indexed to US dollar LIBOR. During the
year, the Group modified such derivatives to reference SOFR, which had
no impact on the hedge accounting relationships in line with the phase 2
interest rate benchmark reform guidance. Derivatives previously indexed
to pound sterling LIBOR were modified to reference SONIA in the year
ended 31 March 2022. The impact of the reform was immaterial for these
instruments.
Hedge accounting
At 31 March 2022, the Group’s hedging instruments documented in hedge
accounting relationships were indexed to US dollar LIBOR. During the year
these instruments were updated to reference SOFR. The impact of the
reform was immaterial on these instruments.
Further information in respect of the Group’s net finance costs for the
year and an indication of the sensitivity to interest rate risk is given in note
16.
In the case of derivative financial instruments, deposits, contract assets
and trade receivables, the Group is exposed to credit risk from the
non-performance of contractual agreements by the contracted party.
Credit risk is managed by:
a
only entering into contracts for derivative financial instruments and
deposits with banks and financial institutions with strong credit ratings,
within limits set for each organisation; and
a
closely controlling dealing activity and regularly monitoring
counterparty positions.
The credit risk on derivative financial instruments utilised and deposits
held by the Group is therefore not considered to be significant. The Group
does not anticipate that any losses will arise from non-performance by its
chosen counterparties. Further information on the Group’s derivative
financial instruments at the balance sheet dates is given in note 31 and
that in respect of amounts recognised in the Group income statement is
given in note 16. Further information on the Group’s cash and cash
equivalents at the balance sheet dates is given in note 26.
To minimise credit risk for trade receivables, the Group has implemented
policies that require appropriate credit checks on potential clients before
granting credit. The maximum credit risk in respect of such financial
assets is their carrying value. Further information in respect of the
Group’s trade receivables is given in note 25.
Debt investments
All of the Group’s debt investments at amortised cost and FVOCI are
considered to have low credit risk; the loss allowance is therefore limited
to 12 months’ expected losses. Management considers ‘low credit risk’ for
listed bonds to be an investment-grade credit rating with at least one
major rating agency. Other instruments are considered to be low credit
risk when they have a low risk of default and the issuer has a high
capacity to meet its contractual cash flow obligations in the near term.
Financial assets at FVPL
The Group is also exposed to credit risk in relation to debt investments
that are measured at FVPL. The maximum exposure at the balance sheet
The Group manages liquidity risk by:
a
issuing long-maturity bonds and notes;
a
entering into long-term committed bank borrowing facilities, to ensure
the Group has sufficient funds available for operations and planned
growth;
a
spreading the maturity dates of its debt; and
a
monitoring rolling cash flow forecasts, to ensure the Group has
adequate, unutilised committed bank borrowing facilities.
Details of such facilities are given in note 28. A maturity analysis of
contractual undiscounted future cash flows for financial liabilities is
The Group’s definition and management of capital focuses on capital
employed:
a
The Group’s capital employed is reported in the net assets summary
table set out in the Financial review and analysed by segment in note
10(a)(iii).
a
As part of its internal reporting processes, the Group monitors capital
employed by operating segment.
The Group’s objectives in managing capital are to:
a
safeguard its ability to continue as a going concern, in order to provide
returns for shareholders and benefits for other stakeholders; and
a
maintain an optimal capital structure and cost of capital.
The Group’s policy is to have:
a
a prudent but efficient balance sheet; and
a
a target leverage ratio of 2.0 to 2.5 times Benchmark EBITDA,
consistent with the intention to retain strong investment-grade credit
ratings.
To maintain or adjust its capital structure, the Group may:
a
adjust the amount of dividends paid to shareholders;
a
return capital to shareholders;
a
issue or purchase our own shares; or
a
The Group has a progressive dividend policy which aims to increase the
dividend over time broadly in line with the underlying growth in
Benchmark EPS. This aligns shareholder returns with the underlying
profitability of the Group. In determining the level of dividend in any one
year, in accordance with the policy, the Board also considers a number of
other factors, including the outlook for the Group, the opportunities for
organic investment, the opportunities to make acquisitions and disposals,
the cash flow generated by the Group, and the level of dividend cover.
Further detail on the distributable reserves of the Company can be found
8. Financial risk management continued
Experian plc
Financial statements
178
Year ended 31 March 2023
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
operating
segments
US$m
Revenue from external customers
Data
2,142
606
391
301
3,440
Decisioning
837
176
229
123
1,365
Business-to-Business
2,979
782
620
424
4,805
Consumer Services
1,453
165
164
—
1,782
Total ongoing activities
4,432
947
784
424
6,587
Year ended 31 March 2022
1
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
operating
segments
US$m
Revenue from external customers
Data
2,033
528
409
333
3,303
Decisioning
784
149
244
123
1,300
Business-to-Business
2,817
677
653
456
4,603
Consumer Services
1,305
114
194
—
1,613
Total ongoing activities
4,122
791
847
456
6,216
1
Revenue for the year ended 31 March 2022 of US$51m has been re-presented for the reclassification to exited business activities of certain B2B businesses.
Total revenue comprises revenue from ongoing activities as well as revenue from exited business activities and is reconciled in note 10. Revenue in
respect of exited business activities of US$32m (2022: US$72m) comprised EMEA/Asia Pacific Data and Decisioning revenue of US$7m (2022: US$18m)
and US$25m (2022: US$54m) respectively.
Data is predominantly transactional revenue with a portion from licence fees.
Decisioning revenue is derived from:
a
software and system sales, and includes recurring licence fees, consultancy and implementation fees, and transactional charges;
a
credit score fees which are primarily transactional; and
a
analytics income comprising a mix of consultancy and professional fees as well as transactional revenue.
Consumer Services revenue primarily comprises monthly subscription and one-off fees, and referral fees for credit products and white-label
partnerships.
The timing of recognition of these revenue streams is discussed in note 5(r).
(b) Significant changes in contract balances
Contract assets predominantly relate to software licence services, where revenue recognition for on-premise arrangements occurs as the solution is
transferred to the customer, whereas the invoicing pattern is often annually over the contract period. Contract assets recognised during the year totalled
US$87m (2022: US$70m). The contract asset balance for work completed but not invoiced on satisfaction of a performance obligation unwinds over
the contract term. Contract assets are transferred to receivables when the right to consideration becomes unconditional, or conditional only on the
passage of time. Contract assets of US$60m (2022: US$77m) were reclassified to receivables during the year. An impairment charge of US$10m
(2022: US$5m) was recognised against contract assets during the year. The decrease in contract assets resulting from disposals during the year was
US$nil (2022: US$5m).
The majority of software licences are invoiced annually in advance. Where these licences relate to Experian-hosted solutions, revenue is recognised over
the period that the service is available to the customer, creating a contract liability. Delivery services are generally invoiced during the delivery period,
creating a contract liability for the consideration received in advance, until the delivery is complete. Where the delivery relates to Experian-hosted
solutions, revenue is recognised over the period that the service is available to the customer, reducing the contract liability over time. Where the delivery
relates to an on-premise solution, the contract liability is released on delivery completion. Support and maintenance agreements are often invoiced
annually in advance, creating a contract liability, which is released over the term of the maintenance period as revenue is recognised.
Revenue recognised in the year of US$401m (2022: US$370m) was included in the opening contract liability. Cash received in advance not recognised
as revenue in the year was US$376m (2022: US$461m). The decrease in contract liabilities resulting from disposals during the year was US$nil
(2022: US$4m). The increase in contract liabilities from acquisitions during the year was US$3m (2022: US$1m).
Foreign exchange accounts for US$4m and US$16m of the decrease in contract asset and contract liability balances in the year respectively (2022: US$3m
(c) Contract costs
The carrying amount of assets recognised from costs to obtain, and costs to fulfil, contracts with customers at 31 March 2023 was US$27m and
US$66m respectively (2022: US$22m and US$66m).
Amortisation of contract costs in the year was US$46m (2022: US$59m); there were no recognised impairment losses in the current or prior year. The
decrease in contract costs resulting from acquisitions and disposals during the year was US$nil (2022: US$2m).
Contract costs are amortised on a systematic basis consistent with the pattern of transfer of the related goods or services. A portfolio approach has been
applied to calculate contract costs for contracts with similar characteristics, where the Group reasonably expects that the effects of applying a portfolio
approach does not differ materially from calculating the amounts at an individual contract level.
(d) Transaction price allocated to remaining performance obligations
The aggregate amount of the transaction price from non-cancellable contracts with customers with expected durations of 12 months or more, allocated
to the performance obligations that are unsatisfied, or partially satisfied, at 31 March 2023 was US$4.9bn (2022: US$5.3bn). We expect to recognise
approximately 49% (2022: 45%) of this value within one year, 30% (2022: 30%) within one to two years, 14% (2022: 15%) within two to three years and 7%
(2022: 10%) thereafter.
The aggregate amount of the transaction price allocated to unsatisfied, or partially satisfied, performance obligations which are transactional in nature
includes estimates of variable consideration. These estimates are based on forecast transactional volumes and do not take into account all external
market factors which may have an impact on the future revenue recognised from such contracts.
A portfolio approach has been applied to calculate the aggregate amount of the transaction price allocated to the unsatisfied, or partially satisfied,
performance obligations for contracts with similar characteristics, where the Group reasonably expects that the effects of applying a portfolio approach
does not differ materially from calculating the amounts at an individual contract level.
We apply the practical expedient in paragraph 121(a) of IFRS 15 and do not disclose information about remaining performance obligations that have
original expected durations of one year or less. This excludes contracts across a number of business units which have revenue due to be recognised in
(a) IFRS 8 disclosures
(i) Income statement
Year ended 31 March 2023
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
operating
segments
US$m
Central
Activities
US$m
Total
continuing
operations
US$m
Revenue from external customers
Ongoing activities
4,432
947
784
424
6,587
—
6,587
Exited business activities
—
—
—
32
32
—
32
Total
4,432
947
784
456
6,619
—
6,619
Reconciliation from Benchmark EBIT to profit/(loss) before tax
Benchmark EBIT
Ongoing activities before transfer pricing and other adjustments
1,497
294
158
(6)
1,943
(141)
1,802
Transfer pricing and other allocation adjustments
(30)
—
12
20
2
(2)
—
Ongoing activities
1,467
294
170
14
1,945
(143)
1,802
Exited business activities
—
—
—
(8)
(8)
—
(8)
Total
1,467
294
170
6
1,937
(143)
1,794
Net interest expense included in Benchmark PBT (note 16(b))
(4)
(1)
(1)
(1)
(7)
(117)
(124)
Benchmark PBT
1,463
293
169
5
1,930
(260)
1,670
Exceptional items (note 15(a))
4
—
—
(70)
(66)
—
(66)
Impairment of goodwill (note 21)
—
—
—
(179)
(179)
—
(179)
Amortisation of acquisition intangibles (note 22)
(124)
(21)
(8)
(39)
(192)
—
(192)
Acquisition and disposal expenses
(18)
(4)
(7)
(17)
(46)
—
(46)
Adjustment to the fair value of contingent consideration
(48)
(5)
8
—
(45)
—
(45)
Non-benchmark share of post-tax loss of associates
—
—
(18)
—
(18)
—
(18)
Interest on uncertain tax provisions
—
—
—
—
—
(1)
(1)
Financing fair value remeasurements (note 16(c))
—
—
—
—
—
51
51
Profit/(loss) before tax
1,277
263
144
(300)
1,384
(210)
1,174
Year ended 31 March 2022
1
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
operating
segments
US$m
Central
Activities
US$m
Total
continuing
operations
US$m
Revenue from external customers
Ongoing activities
4,122
791
847
456
6,216
—
6,216
Exited business activities
—
—
—
72
72
—
72
Total
4,122
791
847
528
6,288
—
6,288
Reconciliation from Benchmark EBIT to profit/(loss) before tax
Benchmark EBIT
Ongoing activities before transfer pricing and other adjustments
1,418
221
179
(10)
1,808
(155)
1,653
Transfer pricing and other allocation adjustments
(37)
2
9
23
(3)
3
—
Ongoing activities
1,381
223
188
13
1,805
(152)
1,653
Exited business activities
—
—
(4)
(4)
(8)
—
(8)
Total
1,381
223
184
9
1,797
(152)
1,645
Net interest expense included in Benchmark PBT (note 16(b))
(4)
(1)
(1)
(2)
(8)
(102)
(110)
Benchmark PBT
1,377
222
183
7
1,789
(254)
1,535
Exceptional items (note 15(a))
6
—
—
(80)
(74)
95
21
Amortisation of acquisition intangibles (note 22)
(110)
(23)
(7)
(34)
(174)
—
(174)
Acquisition and disposal expenses
(21)
(7)
(1)
(18)
(47)
—
(47)
Adjustment to the fair value of contingent consideration
(8)
(20)
4
(2)
(26)
—
(26)
Non-benchmark share of post-tax loss of associates
—
—
(26)
—
(26)
(5)
(31)
Interest on uncertain tax provisions
—
—
—
—
—
1
1
Financing fair value remeasurements (note 16(c))
—
—
—
—
—
168
168
Profit/(loss) before tax
1,244
172
153
(127)
1,442
5
1,447
1
Revenue of US$51m and Benchmark EBIT of US$(13)m for the year ended 31 March 2022 have been re-presented for the reclassification to exited business activities of certain B2B businesses.
Additional information by operating segment, including that on total and organic growth at constant exchange rates, is provided in the Strategic report.
(ii) Reconciliation of revenue from ongoing activities
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
ongoing
activities
US$m
Revenue for the year ended 31 March 2022
1
4,122
791
847
456
6,216
Adjustment to constant exchange rates
—
(3)
3
2
2
Revenue at constant exchange rates for the year ended 31 March 2022
4,122
788
850
458
6,218
Organic revenue growth
272
125
39
15
451
Revenue from acquisitions
38
19
3
—
60
Revenue at constant exchange rates for the year ended 31 March 2023
4,432
932
892
473
6,729
Adjustment to actual exchange rates
—
15
(108)
(49)
(142)
Revenue for the year ended 31 March 2023
4,432
947
784
424
6,587
Organic revenue growth at constant exchange rates
7%
16%
5%
3%
7%
Revenue growth at constant exchange rates
8%
18%
5%
3%
8%
1
Revenue of US$51m for the year ended 31 March 2022 has been re-presented for the reclassification to exited business activities of certain B2B businesses.
The table above demonstrates the application of the methodology set out in note 7 in determining organic and total revenue growth at constant exchange
rates. Revenue at constant exchange rates is reported for both years using the average exchange rates applicable for the year ended 31 March 2022.
(iii) Balance sheet
Net assets/(liabilities)
At 31 March 2023
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
operating
segments
US$m
Central
Activities
and other
US$m
Total
Group
US$m
Goodwill
3,662
724
700
489
5,575
—
5,575
Investments in associates
3
—
9
—
12
—
12
Right-of-use assets
72
16
14
20
122
6
128
Assets classified as held-for-sale
—
—
—
4
4
12
16
Other assets
2,406
686
530
505
4,127
1,006
5,133
Total assets
6,143
1,426
1,253
1,018
9,840
1,024
10,864
Lease obligations
(89)
(19)
(14)
(21)
(143)
(5)
(148)
Liabilities classified as held-for-sale
—
—
—
(3)
(3)
—
(3)
Other liabilities
(1,307)
(327)
(304)
(189)
(2,127)
(4,622)
(6,749)
Total liabilities
(1,396)
(346)
(318)
(213)
(2,273)
(4,627)
(6,900)
Net assets/(liabilities)
4,747
1,080
935
805
7,567
(3,603)
3,964
At 31 March 2022
North
America
US$m
Latin
America
US$m
UK and
Ireland
US$m
EMEA/
Asia Pacific
US$m
Total
operating
segments
US$m
Central
Activities
and other
US$m
Total
Group
US$m
Goodwill
3,546
760
694
737
5,737
—
5,737
Investments in associates
4
—
—
—
4
—
4
Right-of-use assets
83
14
24
27
148
5
153
Assets classified as held-for-sale
—
—
29
—
29
12
41
Other assets
2,191
674
528
619
4,012
947
4,959
Total assets
5,824
1,448
1,275
1,383
9,930
964
10,894
Lease obligations
(105)
(17)
(25)
(30)
(177)
(3)
(180)
Other liabilities
(1,129)
(327)
(300)
(364)
(2,120)
(4,587)
(6,707)
Total liabilities
(1,234)
(344)
(325)
(394)
(2,297)
(4,590)
(6,887)
Net assets/(liabilities)
4,590
1,104
950
989
7,633
(3,626)
4,007
Central Activities and other comprises:
2023
2022
Assets
US$m
Liabilities
US$m
Net assets/
(liabilities)
US$m
Assets
US$m
Liabilities
US$m
Net assets/
(liabilities)
US$m
Central Activities
731
(175)
556
682
(155)
527
Net debt
1
206
(4,094)
(3,888)
199
(3,973)
(3,774)
Tax
87
(358)
(271)
83
(462)
(379)
1,024
(4,627)
(3,603)
964
(4,590)
(3,626)
1
Net debt comprises amounts reported within Central Activities plus lease obligations in operating segments, net of interest of US$142m (2022: US$176m).
Capital employed
2023
US$m
2022
US$m
North America
4,747
4,590
Latin America
1,080
1,104
UK and Ireland
935
950
EMEA/Asia Pacific
805
989
Total operating segments
7,567
7,633
Central Activities
556
527
Add: lease obligations in operating segments
143
177
Less: accrued interest on lease obligations in operating segments
(1)
(1)
Less: right-of-use assets
(128)
(153)
Less: non-controlling interests
(35)
(38)
Capital employed attributable to owners
8,102
8,145
The three-point average capital employed figure of US$8,060m (2022: US$7,774m), used in our calculation of ROCE, is determined by calculating the
arithmetic average of capital employed at 31 March 2023, 30 September 2022 and 31 March 2022.
(iv) Capital expenditure, amortisation and depreciation
Capital expenditure
Right-of-use
asset additions
Amortisation
Depreciation
2023
US$m
2022
US$m
2023
US$m
2022
US$m
2023
US$m
2022
US$m
2023
US$m
2022
US$m
North America
324
251
15
17
170
167
57
58
Latin America
134
106
9
5
81
69
17
17
UK and Ireland
74
49
3
6
41
51
21
26
EMEA/Asia Pacific
44
47
8
11
29
33
17
22
Total operating segments
576
453
35
39
321
320
112
123
Central Activities
51
55
4
—
47
38
2
3
Total Group
627
508
39
39
368
358
114
126
Amortisation and depreciation above only include amounts charged to Benchmark PBT.
(v) Revenue by country – continuing operations
2023
US$m
2022
US$m
USA
4,429
4,121
Brazil
839
692
UK
780
843
Other
571
632
6,619
6,288
Revenue is primarily attributable to countries other than Ireland. No single client accounted for 10% or more of revenue in the current or prior year.
Revenue from the USA, Brazil and the UK in aggregate comprises 91% (2022: 90%) of Group revenue. Other comprises a number of other countries, none
of which have revenue that is individually material.
(vi) Non-current assets by country
2023
US$m
2022
US$m
USA
5,237
5,050
UK
1,022
1,018
Brazil
897
907
Germany
422
441
South Africa
218
264
Colombia
122
155
Other
434
674
Segment non-current assets by country
8,352
8,509
Central Activities
681
666
Deferred tax
37
46
9,070
9,221
To add clarity to the presentation of this information, non-current assets for Central Activities and deferred tax have been excluded from the analysis
by country. The Group has no significant non-current assets located in Ireland.
(b) Information on business segments (including non-GAAP disclosures)
Year ended 31 March 2023
Business-to-
Business
US$m
Consumer
Services
US$m
Total
business
segments
US$m
Central
Activities
US$m
Total
continuing
operations
US$m
Revenue from external customers
Ongoing activities
4,805
1,782
6,587
—
6,587
Exited business activities
32
—
32
—
32
Total
4,837
1,782
6,619
—
6,619
Reconciliation from Benchmark EBIT to profit/(loss) before tax
Benchmark EBIT
Ongoing activities before transfer pricing and other adjustments
1,517
426
1,943
(141)
1,802
Transfer pricing and other allocation adjustments
12
(10)
2
(2)
—
Ongoing activities
1,529
416
1,945
(143)
1,802
Exited business activities
(8)
—
(8)
—
(8)
Total
1,521
416
1,937
(143)
1,794
Net interest expense included in Benchmark PBT (note 16(b))
(5)
(2)
(7)
(117)
(124)
Benchmark PBT
1,516
414
1,930
(260)
1,670
Exceptional items (note 15(a))
(66)
—
(66)
—
(66)
Impairment of goodwill (note 21)
(179)
—
(179)
—
(179)
Amortisation of acquisition intangibles (note 22)
(159)
(33)
(192)
—
(192)
Acquisition and disposal expenses
(23)
(23)
(46)
—
(46)
Adjustment to the fair value of contingent consideration
(45)
—
(45)
—
(45)
Non-benchmark share of post-tax loss of associates
—
(18)
(18)
—
(18)
Interest on uncertain tax provisions
—
—
—
(1)
(1)
Financing fair value remeasurements (note 16(c))
—
—
—
51
51
Profit/(loss) before tax
1,044
340
1,384
(210)
1,174
Year ended 31 March 2022
1
Business-to-
Business
US$m
Consumer
Services
US$m
Total
business
segments
US$m
Central
Activities
US$m
Total
continuing
operations
US$m
Revenue from external customers
Ongoing activities
4,603
1,613
6,216
—
6,216
Exited business activities
72
—
72
—
72
Total
4,675
1,613
6,288
—
6,288
Reconciliation from Benchmark EBIT to profit before tax
Benchmark EBIT
Ongoing activities before transfer pricing and other adjustments
1,422
386
1,808
(155)
1,653
Transfer pricing and other allocation adjustments
9
(12)
(3)
3
—
Ongoing activities
1,431
374
1,805
(152)
1,653
Exited business activities
(5)
(3)
(8)
—
(8)
Total
1,426
371
1,797
(152)
1,645
Net interest expense included in Benchmark PBT (note 16(b))
(6)
(2)
(8)
(102)
(110)
Benchmark PBT
1,420
369
1,789
(254)
1,535
Exceptional items (note 15(a))
(74)
—
(74)
95
21
Amortisation of acquisition intangibles (note 22)
(145)
(29)
(174)
—
(174)
Acquisition and disposal expenses
(34)
(13)
(47)
—
(47)
Adjustment to the fair value of contingent consideration
(26)
—
(26)
—
(26)
Non-benchmark share of post-tax loss of associates
—
(26)
(26)
(5)
(31)
Interest on uncertain tax provisions
—
—
—
1
1
Financing fair value remeasurements (note 16(c))
—
—
—
168
168
Profit before tax
1,141
301
1,442
5
1,447
1
Revenue of US$51m and Benchmark EBIT of US$(13)m for the year ended 31 March 2022 have been re-presented for the reclassification to exited business activities of certain B2B businesses.
10. Segment information continued
Experian plc
Financial statements
184
(a) Principal exchange rates used
Average
Closing
2023
2022
2023
2022
2021
US dollar : Brazilian real
5.16
5.34
5.08
4.78
5.74
Pound sterling : US dollar
1.20
1.37
1.24
1.31
1.38
Euro : US dollar
1.04
1.16
1.09
1.11
1.17
US dollar : Colombian peso
4,469
3,834
4,623
3,757
3,720
US dollar : South African rand
17.00
14.85
17.71
14.56
14.76
(b) Foreign exchange risk
(i) Brazilian real intra-Group funding
A Group company whose functional currency is not the Brazilian real provides Brazilian real intra-Group funding to Serasa S.A.. Foreign exchange gains
or losses on this funding are recognised in the Group income statement.
As a result of the weakening of 6% in the Brazilian real against the US dollar in the year ended 31 March 2023, a charge of US$16m has been recognised
within financing fair value remeasurements (2022: US$43m gain due to 17% strengthening) (note 16(c)).
The Group is similarly exposed to the impact of the Brazilian real strengthening or weakening against the US dollar in the future. A movement of 14%
would result in a US$30m impact on profit before tax. There is no effect on total equity as a result of this exposure, since it arises on intra-Group funding
and there would be a related equal but opposite foreign exchange movement recognised in the translation reserve within equity.
(ii) Other exposures
On the basis of the profile of foreign exchange exposures, and an assessment of reasonably possible changes in such exposures, there are no other
material sensitivities to foreign exchange risk at the balance sheet dates. In making these assessments, actual data on movements in the principal
currencies over the most recent three-year period has been considered together with exposures at the balance sheet dates. This methodology has been
Notes
2023
US$m
2022
US$m
Wages and salaries
1,591
1,604
Social security costs
295
254
Share incentive plans
34(a)
142
158
Pension costs – defined benefit plans
36(a)
2
8
Pension costs – defined contribution plans
65
68
Other employee benefit costs
30
27
Employee benefit costs
2,125
2,119
Other labour costs
256
194
2,381
2,313
Labour costs include redundancy costs of US$30m (2022: US$9m) of which US$21m (2022: US$2m) relates to restructuring (note 15(d)). Other labour
costs include those in respect of external contractors, outsourcing and the recruitment, development and training of employees. The definition of key
management personnel, and an analysis of their remuneration, is given in note 47(d).
(b) Average monthly number of employees (including executive directors)
2023
2022
Full-time
Part-time
Full-time-
equivalent
Full-time
Part-time
Full-time-
equivalent
North America
8,789
59
8,819
8,669
56
8,697
Latin America
5,194
172
5,280
4,538
137
4,606
UK and Ireland
3,507
215
3,615
3,129
221
3,240
EMEA/Asia Pacific
3,588
127
3,651
3,858
100
3,908
Total operating segments
21,078
573
21,365
20,194
514
20,451
Central Activities
235
13
242
200
12
206
21,313
586
21,607
20,394
526
2023
US$m
2022
US$m
Benchmark:
Amortisation of other intangible assets
368
358
Depreciation of property, plant and equipment
114
126
482
484
Non-benchmark:
Amortisation of acquisition intangibles
192
174
674
658
An analysis by segment of amounts charged within Benchmark PBT is given in note 10(a)(iv). Analyses by asset type are given in notes 22 and 23.
2023
US$m
2022
US$m
Audit of the Company and Group financial statements
1.2
1.2
Audit of the financial statements of the Company's subsidiaries
5.6
5.7
Audit-related assurance services
0.6
0.6
Other assurance services
0.2
0.2
Total fees payable to the Company's auditor and its associates
7.6
7.7
Summary of fees by nature:
Fees for audit services
6.8
6.9
Fees for audit-related assurance services
0.6
0.6
Fees for other assurance services
0.2
0.2
7.6
7.7
The guidelines covering the use of the Company’s auditor for non-audit services are set out in the Audit Committee report. Fees for other assurance
services were capped at 30% (2022: 30%) of the fees for audit services. In the year ended 31 March 2023, fees payable for non-audit services, were 12%
(2022: 12%) of fees payable for audit services. Such fees are reported within Other operating charges.
The fees for audit-related assurance services relate to the Group’s half-yearly financial report and US$0.1m (2022: US$0.1m) of the fees for other
(a) Net charge for Exceptional items and other adjustments made to derive Benchmark PBT
Notes
2023
US$m
2022
US$m
Exceptional items:
Net loss on disposal of operations
15(b), 21(a), 44
1
43
Net profit on disposal of associates
15(c), 24
(1)
(90)
Restructuring costs
15(d)
53
20
Onerous global support costs
1
15(e)
16
—
Legal provisions movements
1
15(f)
(3)
6
Net charge/(credit) for Exceptional items
66
(21)
Other adjustments made to derive Benchmark PBT:
Amortisation of acquisition intangibles
13, 22
192
174
Impairment of goodwill
1
21
179
—
Acquisition and disposal expenses
2
46
47
Adjustment to the fair value of contingent consideration
1
31(h)
45
26
Non-benchmark share of post-tax loss of associates
3
24
18
31
Interest on uncertain tax provisions
16(c)
1
(1)
Financing fair value remeasurements
16(c)
(51)
(168)
Net charge for other adjustments made to derive Benchmark PBT
430
109
Net charge for Exceptional items and other adjustments made to derive Benchmark PBT
496
88
By income statement caption:
Labour costs
40
11
Amortisation and depreciation charges
192
174
Other operating charges
296
88
Loss on disposal of operations
1
43
Net profit on disposal of associates
(1)
(90)
Within operating profit
528
226
Within share of post-tax loss of associates
18
31
Within finance expense
16(a)
(50)
(169)
Net charge for Exceptional items and other adjustments made to derive Benchmark PBT
496
88
1
Included in other operating charges.
2
Acquisition and disposal expenses represent professional fees and expenses associated with completed, ongoing and terminated acquisition and disposal processes, as well as the integration and separation costs
associated with completed deals. Of the total, US$7m (2022: US$9m) is recorded within labour costs in the Group income statement, and US$39m (2022: US$38m) is included within other operating charges.
3
Includes impairment of investment in associate.
(b) Net loss on disposal of operations
The net loss on disposal of operations comprises costs incurred following the cessation of our activities in Russia in the year ended 31 March 2022 of
US$3m (2022: US$43m) and a gain of US$2m (2022: US$nil) on the disposal of interests in two small subsidiaries in EMEA/Asia Pacific.
(c) Net profit on disposal of associates
On 18 November 2020, the Group disposed of its 18.6% interest in Finicity Corporation. During the year further consideration of US$1m (2022: US$12m)
was received in respect of earnout arrangements, the payout of which was not anticipated at 31 March 2021.
On 4 February 2022, Vector CM Holdings (Cayman) L.P., an associate undertaking, completed a merger with the CM Group involving its Cheetah Digital
business. As a result of the merger, the Group no longer has significant influence over Vector and accordingly our interest in this company was
recognised as a trade investment from that date. We recorded a fair value gain on the disposal in FY22 of US$95m, and the promissory note and
associated interest due to Experian of US$110m were also repaid.
In the year ended 31 March 2022, we recognised a disposal of our Russian associate, United Credit Bureau, and wrote off the investment, recording a
loss of US$17m.
(d) Restructuring costs
Costs of US$53m (2022: US$20m) were recognised in the year associated with a strategic review and restructuring, primarily in EMEA/Asia Pacific. We
continue to execute on our strategy to concentrate on strategic markets where we can drive scale while also enhancing operating efficiency.
The charge includes a loss on disposal and asset write-downs and impairments of US$23m (2022: US$nil), and US$21m (2022: US$2m) is labour
related. The associated cash outflow was US$20m (2022: US$14m).
(e) Onerous global support costs
The charge in the year comprises costs that are directly attributable to exited businesses or incurred solely to support sub-scale, multi-country markets,
and will be removed as we complete restructuring activity in EMEA/Asia Pacific.
(f) Legal provisions movements
Movements have occurred in provisions held for a number of historical legal claims, some of which are in the process of being settled. The credit in the
2023
US$m
2022
US$m
Interest income:
Bank deposits, short-term investments and loan notes
(9)
(14)
Interest on pension plan assets
(4)
(1)
Interest income
(13)
(15)
Net non-benchmark finance income (note 16(c))
(50)
(169)
Finance income
(63)
(184)
Finance expense:
Eurobonds and notes
91
95
Bank loans, commercial paper, overdrafts and other
14
6
Commitment and facility fees
6
7
Interest on leases
7
8
Interest differentials on derivatives
19
9
Interest expense
137
125
Net finance expense/(income) included in profit before tax
74
2023
US$m
2022
US$m
Interest income
(13)
(15)
Interest expense
137
125
Net interest expense included in Benchmark PBT
124
(c) Analysis of net non-benchmark finance income
2023
US$m
2022
US$m
Fair value gains on borrowings – attributable to interest rate risk
(59)
(69)
Fair value gains on borrowings – attributable to currency risk
(65)
(77)
Losses on interest rate swaps – fair value hedges
17
19
Losses on cross-currency swaps – fair value hedges
72
98
Foreign currency losses on cross-currency swaps designated as a cash flow hedge – transfer from OCI
30
26
Gains on items in hedging relationships – hedge ineffectiveness
(5)
(3)
Fair value gains on non-hedging derivatives
(62)
(88)
Foreign exchange losses/(gains) on Brazilian real intra-Group funding
16
(43)
Other foreign exchange losses/(gains) on financing activities
21
(3)
Monetary loss on hyperinflation
3
—
Decrease in present value of put options
(26)
(29)
Movement in Other financial assets at FVPL
2
—
Movement in connection with commitments to purchase own shares
—
(2)
Net credit for financing fair value remeasurements
(51)
(168)
Interest on uncertain tax provisions
1
(1)
(50)
(d) Interest rate risk
The following table shows the sensitivity to interest rate risk, on the basis of the profile of Net debt at the balance sheet dates and an assessment of
reasonably possible changes in the principal interest rates, with all other variables held constant. In making this assessment, actual movements in
relevant interest rates over the most recent three-year period have been considered and a consistent methodology applied. An indication of the primary
cause of the reported sensitivity is included.
Gain/(loss)
2023
US$m
2022
US$m
Impact on profit for the financial year:
Effect of an increase of 1.6% (2022: 0.8%) on US dollar-denominated Net debt:
Due to the revaluation of borrowings and related derivatives, higher interest expense on borrowings and higher interest
income on cash and cash equivalents
67
42
Effect of an increase of 1.0% (2022: 0.3%) on pound sterling-denominated Net debt:
Due to the revaluation of borrowings and related derivatives, higher interest expense on borrowings and higher interest
income on cash and cash equivalents
2
1
Effect of an increase of 4.7% (2022: 3.0%) on Brazilian real-denominated Net debt:
Due to higher interest income on cash and cash equivalents
3
1
Effect of an increase of 0.5% (2022: 0.1%) on euro-denominated Net debt:
Due to the revaluation of borrowings and related derivatives, higher interest expense on borrowings and higher interest
income on cash and cash equivalents
—
—
Impact on other components of equity:
Effect of an increase of 1.6% (2022: 0.8%):
On the fair value of the US dollar leg of cross-currency swaps treated as a cash flow hedge
15
11
Effect of an increase of 1.0% (2022: 0.3%):
On the fair value of the pound sterling leg of cross-currency swaps treated as a cash flow hedge
(9)
(4)
17. Tax charge
(a) Analysis of tax charge in the Group income statement
2023
US$m
2022
US$m
Current tax:
Tax on income for the year
515
339
Adjustments in respect of earlier years
6
(25)
Total current tax charge
521
314
Deferred tax:
Origination and reversal of temporary differences
(146)
(15)
Adjustments in respect of earlier years
26
(3)
Total deferred tax credit
(120)
(18)
Tax charge
401
296
The tax charge comprises:
UK tax
57
87
Non-UK tax
344
209
401
296
(b) Tax reconciliations
(i) Reconciliation of the tax charge
As the Group is subject to the tax rates of more than one country, it has chosen to present its reconciliation of the tax charge using the main rate of
corporation tax in the UK. The effective rate of tax for each year based on profit before tax is higher (2022: higher) than the main rate of corporation tax
in the UK, with the differences explained in note 17(c).
2023
US$m
2022
(Re-presented)
US$m
Profit before tax
1,174
1,447
Profit before tax multiplied by the main rate of UK corporation tax of 19% (2022: 19%)
223
275
Effects of:
Adjustments in respect of earlier years
32
(28)
Tax on Exceptional items
3
(6)
Income not taxable
(30)
(18)
Losses not recognised
11
18
Goodwill impairment
54
—
Expenses not deductible
64
18
Different effective tax rates in non-UK businesses
22
36
Local taxes
1
53
48
Current year movement in uncertain tax positions
9
(24)
Recognition/utilisation of previously unrecognised tax losses
(14)
(9)
Research and development incentive claims
1
(26)
(14)
Tax charge
401
296
Effective rate of tax based on profit before tax
34.2%
20.5%
1
Amounts previously recorded as local taxes have been re-analysed during the year to provide additional information, and the effects of research and development incentive claims are now shown separately in the
tax charge reconciliation. The comparative figures for the year ended 31 March 2022 have been re-presented to reflect this change. Local taxes primarily comprise US state taxes.
(ii) Reconciliation of the tax charge to the Benchmark tax charge
2023
US$m
2022
US$m
Tax charge
401
296
Tax relief on Exceptional items and other adjustments made to derive Benchmark PBT
33
98
Benchmark tax charge
434
394
Benchmark PBT
1,670
1,535
Benchmark tax rate
26.0%
25.7%
(c) Factors that affect the tax charge
Adjustments in respect of earlier periods reflect the net movement on uncertain tax positions, including adjustments for matters that have been
substantively agreed with local tax authorities, and adjustments to deferred tax assets based on latest estimates and assumptions.
Expenses not deductible include the impairment of associate investments, acquisition and disposal expenses and financing fair value remeasurements
which are not allowable for tax purposes.
The Group’s tax rate reflects its internal financing arrangements in place to fund non-UK businesses.
In addition, in the normal course of business, the Group has a number of open tax returns with various tax authorities with whom it is in active dialogue.
At 31 March 2023, the Group held current and deferred tax liabilities of US$102m (2022: US$293m) in respect of uncertain tax positions.
During the current and prior year, Experian was in discussions with the US Internal Revenue Service and His Majesty’s Revenue and Customs in the UK
to seek clarity on transfer pricing and financing related issues. The net decrease in recognised provisions during the year was driven by the agreement
of the Group’s most significant uncertain tax position. In the year ended 31 March 2022, the net decrease in recognised provisions followed the
agreement of open tax issues in North America, and adjustments made to provisions on the utilisation of historical UK tax losses.
Liabilities relating to these open and judgmental matters are based on an assessment as to whether additional taxes will be due, after taking into
account external advice where appropriate. While the timing of developments in resolving these matters is inherently uncertain, the Group does not
expect to materially increase its uncertain tax provisions in the next 12 months. However if an opportunity arose to resolve the matters for less than the
amounts provided, a settlement may be made with a corresponding reduction in the provision.
(d) Other factors that affect the future tax charge
The Group’s tax charge will continue to be influenced by the profile of profits earned in different countries in which the Group’s subsidiaries operate, in
particular our material markets, being North America, Brazil and the UK. Tax reform continues in 2023 and is expected in future years driven by the
Organisation for Economic Co-operation and Development’s (OECD) project to address the tax challenges arising from the digitalisation of the economy
including the proposed global minimum tax legislation. Experian continues to analyse the implications for the Group from these model rules and will
determine the outcome once the final relevant legislation is available. This may result in significant changes to established tax principles and an increase
in tax authority disputes. In turn, this could adversely affect Experian’s effective tax rate or could result in higher cash tax liabilities.
The main rate of UK corporation tax for the year ended 31 March 2023 was 19% and increased to 25% from 1 April 2023. This will have a consequential
There have been no material divestments of subsidiaries during the year ended 31 March 2023. The profit from discontinued operations in the year
ended 31 March 2022 of US$16m comprised the release of historical tax provisions relating to the disposal of the Group’s comparison shopping and lead
generation businesses in FY13, and our email/cross-channel marketing business (CCM) in FY18.
(a) Earnings per share
Basic
Diluted
2023
US cents
2022
US cents
2023
US cents
2022
US cents
Continuing and discontinued operations
84.2
127.5
83.6
126.5
Less: profit from discontinued operations
—
(1.8)
—
(1.7)
Continuing operations
84.2
125.7
83.6
124.8
Add/(deduct): Exceptional items and other adjustments made to derive Benchmark PBT,
net of related tax
50.9
(1.2)
50.5
(1.2)
Benchmark EPS (non-GAAP measure)
135.1
124.5
134.1
123.6
(b) Analysis of earnings
(i) Attributable to owners of Experian plc
2023
US$m
2022
US$m
Continuing and discontinued operations
770
1,165
Less: profit from discontinued operations
—
(16)
Continuing operations
770
1,149
Add/(deduct): Exceptional items and other adjustments made to derive Benchmark PBT, net of related tax
465
(11)
Benchmark earnings attributable to owners of Experian plc (non-GAAP measure)
1,235
1,138
(ii) Attributable to non-controlling interests
2023
US$m
2022
US$m
Profit for the financial year attributable to non-controlling interests
3
2
(Deduct)/add: Exceptional items and other adjustments made to derive Benchmark PBT, net of related tax
(2)
1
Benchmark earnings attributable to non-controlling interests (non-GAAP measure)
1
3
(c) Reconciliation of Total Benchmark earnings to profit for the financial year
2023
US$m
2022
US$m
Total Benchmark earnings (non-GAAP measure)
1,236
1,141
Profit from discontinued operations
—
16
Exceptional items and other adjustments made to derive Benchmark PBT, net of related tax:
– attributable to owners of Experian plc
(465)
11
– attributable to non-controlling interests
2
(1)
Profit for the financial year
773
1,167
(d) Weighted average number of ordinary shares
2023
million
2022
million
Weighted average number of ordinary shares
914
914
Add: dilutive effect of share incentive awards, options and share purchases
7
7
Diluted weighted average number of ordinary shares
921
2023
2022
US cents
per share
US$m
US cents
per share
US$m
Amounts recognised and paid during the financial year:
First interim – paid in February 2023 (2022: February 2022)
17.00
155
16.00
147
Second interim – paid in July 2022 (2022: July 2021)
35.75
327
32.50
297
Dividends paid on ordinary shares
482
444
Full-year dividend for the financial year
499
474
A second interim dividend in respect of the year ended 31 March 2023 of 37.75 US cents per ordinary share will be paid on 21 July 2023, to shareholders
on the register at the close of business on 23 June 2023. This dividend is not included as a liability in these financial statements. This second interim
dividend and the first interim dividend paid in February 2023 comprise the full-year dividend for the financial year of 54.75 US cents per ordinary share.
Further administrative information on dividends is given in the Shareholder and corporate information section. Dividend amounts are quoted gross.
In the year ended 31 March 2023, the employee trusts waived their entitlements to dividends of US$4m (2022: US$4m). There is no entitlement to
Experian plc
Financial statements
192
(a) Movements in goodwill
2023
US$m
2022
US$m
Cost
At 1 April
5,790
5,314
Differences on exchange
(149)
40
Additions through business combinations (note 42(a))
180
469
Disposal of business (note 44)
—
(33)
At 31 March
5,821
5,790
Accumulated impairment
At 1 April
53
53
Differences on exchange
14
—
Impairment charge
179
—
At 31 March
246
53
Net book amount at 1 April
5,737
5,261
Net book amount at 31 March
5,575
5,737
(b) Goodwill by CGU
2023
US$m
2022
US$m
North America
3,662
3,546
Latin America
724
760
UK and Ireland
700
694
EMEA
409
649
Asia Pacific
80
88
At 31 March
5,575
5,737
(c) Key assumptions for value-in-use calculations by CGU
2023
2022
Discount rate
% p.a.
Long-term
growth rate
% p.a.
Discount rate
% p.a.
Long-term
growth rate
% p.a.
North America
11.2
2.3
9.3
2.3
Latin America
15.8
4.7
13.5
4.7
UK and Ireland
10.9
2.3
9.1
2.3
EMEA
12.6
3.9
10.6
3.9
Asia Pacific
11.2
5.3
8.6
5.3
As indicated in note 6(a), value-in-use calculations are underpinned by financial forecasts looking forward up to five years, which continue to reflect our
current assessment of the impact of climate change and associated commitments the Group has made. Management’s key assumptions in setting the
financial budgets for the initial five-year period were as follows:
a
forecast revenue growth rates were based on past experience, adjusted for the strategic opportunities within each CGU; the forecasts used average
nominal growth rates of up to 14%, with high-single-digit average nominal growth rates in EMEA and Asia Pacific;
a
Benchmark EBIT was forecast based on historical margins. These were expected to improve modestly throughout the period in the mature CGUs and
improve annually by a mid-single-digit amount in EMEA and Asia Pacific; and
a
forecast Benchmark operating cash flow conversion rates were based on historical experience and performance expectations with rates of up to 93%
unless a Benchmark EBIT loss was forecast. In these circumstances, cash outflows were forecast to exceed the Benchmark EBIT loss.
Further details of the principles used in determining the basis of allocation by CGU and annual impairment testing are given in note 6(a).
(d) Results of annual impairment review as at 31 March 2023
Any additional adverse movement in the key assumptions at the balance sheet date would lead to a further impairment of goodwill. The sensitivities
can be summarised as follows:
a
an absolute increase of 1.0 percentage points in the discount rate would lead to a further impairment of US$80m; or
a
an absolute reduction in the long-term growth rate of 1.0 percentage points would lead to a further impairment of US$60m; or
a
an absolute reduction of 2.0 or 4.0 percentage points in the forecast FY28 profit margin of 22.2% would lead to an additional impairment of US$53m
or US$106m respectively; or
a
a 10% or 20% reduction in the forecast FY28 profit would lead to an additional impairment of US$58m or US$117m respectively.
The review for the Asia Pacific CGU indicated that the recoverable amount exceeded the carrying value by US$120m and that any decline in the
estimated value-in-use in excess of that amount would result in the recognition of an impairment charge. The sensitivities, which result in the
recoverable amount being equal to the carrying value, can be summarised as follows:
a
an absolute increase of 3.9 percentage points in the discount rate, from 11.2% to 15.1%; or
a
an absolute reduction of 5.4 percentage points in the long-term growth rate, from growth of 5.3% to a decline of 0.1%; or
a
a reduction of 5.4 percentage points in the forecast FY28 profit margin, from 14.4% to 9.0%. A reduction in the annual margin improvement of
approximately 1.1 percentage points per year over the five-year forecast period would also reduce the recoverable amount to the carrying value; or
a
an absolute reduction of 38% in the forecast FY28 profit.
The recoverable amount of all other CGUs exceeded their carrying value, on the basis of the assumptions set out in the table in note 21(c) and any
reasonably possible changes thereof.
The impairment review considered the potential impact of climate change by considering the results of the scenario analysis performed consistent
21. Goodwill continued
Experian plc
Financial statements
194
Acquisition intangibles
Databases
US$m
Internal use
software
US$m
Internally
generated
software
US$m
Total
US$m
Customer
and other
relationships
US$m
Acquired
software
development
US$m
Marketing-
related
assets
US$m
Cost
At 1 April 2022
1,634
497
108
1,515
347
1,190
5,291
Differences on exchange
(38)
(12)
(4)
(62)
(12)
(18)
(146)
Additions through business combinations (note 42)
70
55
1
—
—
4
130
Other additions
—
—
—
190
38
335
563
Disposals
(23)
(51)
(4)
(139)
(18)
(78)
(313)
At 31 March 2023
1,643
489
101
1,504
355
1,433
5,525
Accumulated amortisation and impairment
At 1 April 2022
759
312
89
1,055
269
593
3,077
Differences on exchange
(26)
(7)
(1)
(46)
(7)
(17)
(104)
Charge for the year
124
64
4
166
28
174
560
Impairment charge
—
—
—
—
—
9
9
Disposals
(23)
(51)
(4)
(139)
(18)
(71)
(306)
At 31 March 2023
834
318
88
1,036
272
688
3,236
Net book amount at 31 March 2023
809
171
13
468
83
745
2,289
Acquisition intangibles
Databases
US$m
Internal use
software
US$m
Internally
generated
software
US$m
Total
US$m
Customer
and other
relationships
US$m
Acquired
software
development
US$m
Marketing-
related
assets
US$m
Cost
At 1 April 2021
1,505
401
100
1,345
327
1,042
4,720
Differences on exchange
9
2
5
90
1
(8)
99
Additions through business combinations
207
105
9
(1)
1
(6)
315
Other additions
—
—
—
180
29
236
445
Disposals
(87)
(11)
(6)
(99)
(11)
(74)
(288)
At 31 March 2022
1,634
497
108
1,515
347
1,190
5,291
Accumulated amortisation and impairment
At 1 April 2021
721
266
85
923
251
508
2,754
Differences on exchange
9
3
6
69
—
(8)
79
Charge for the year
116
54
4
162
29
167
532
Disposals
(87)
(11)
(6)
(99)
(11)
(74)
(288)
At 31 March 2022
759
312
89
1,055
269
593
3,077
Net book amount at 1 April 2021
784
135
15
422
76
534
1,966
Net book amount at 31 March 2022
875
185
19
460
78
597
2,214
Within the above are the following individually material assets at 31 March 2023:
a
North America Healthcare customer relationships have a net book value of US$132m and a remaining amortisation period of five years.
a
North America Tapad, Inc. customer relationships with a net book value of US$133m and a remaining amortisation period of 15 years.
a
Experian DACH customer relationships with a net book value of US$84m and a remaining amortisation period of ten years.
A loss of US$7m (2022: US$nil) on the disposal of internally generated software assets is reported within non-benchmark items in the Group income
statement, as it relates to assets developed for markets in which we no longer operate as a result of restructuring activity (note 15(d)). The impairment
charge in the year includes US$5m in relation to restructuring activity, and US$3m arising from the write-down of the fair value of acquired intangibles.
195
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
Freehold
properties
US$m
Leasehold
improvements
US$m
Plant and
equipment
US$m
Right-of-use assets
Total
US$m
Land and
buildings
US$m
Motor
vehicles
US$m
Plant and
equipment
US$m
Cost
At 1 April 2022
78
156
653
205
23
40
1,155
Differences on exchange
(5)
(1)
(20)
(4)
(1)
(2)
(33)
Additions through business combinations
—
—
1
—
—
—
1
Other additions
—
2
62
29
9
1
103
Disposals
—
(7)
(52)
(29)
(5)
(3)
(96)
At 31 March 2023
73
150
644
201
26
36
1,130
Accumulated depreciation and impairment
At 1 April 2022
20
83
522
86
10
19
740
Differences on exchange
(1)
—
(15)
(2)
—
(2)
(20)
Charge for the year
1
5
56
37
6
9
114
Disposals
—
(7)
(51)
(22)
(4)
(2)
(86)
At 31 March 2023
20
81
512
99
12
24
748
Net book amount at 31 March 2023
53
69
132
102
14
12
382
Freehold
properties
US$m
Leasehold
improvements
US$m
Plant and
equipment
US$m
Right-of-use assets
Total
US$m
Land and
buildings
US$m
Motor
vehicles
US$m
Plant and
equipment
US$m
Cost
At 1 April 2021
136
154
628
195
20
41
1,174
Differences on exchange
(1)
1
(1)
—
—
1
—
Additions through business combinations
—
—
1
2
—
1
4
Other additions
—
2
61
27
8
4
102
Disposal of business
—
—
—
(1)
—
—
(1)
Other disposals
(36)
(1)
(28)
(18)
(5)
(7)
(95)
Transfer in respect of assets held-for-sale (note 43)
(21)
—
(8)
—
—
—
(29)
At 31 March 2022
78
156
653
205
23
40
1,155
Accumulated depreciation and impairment
At 1 April 2021
48
78
495
62
8
14
705
Differences on exchange
(1)
1
(3)
(1)
—
1
(3)
Charge for the year
2
5
63
39
6
11
126
Other disposals
(18)
(1)
(27)
(14)
(4)
(7)
(71)
Transfer in respect of assets held-for-sale (note 43)
(11)
—
(6)
—
—
—
(17)
At 31 March 2022
20
83
522
86
10
19
740
Net book amount at 1 April 2021
88
76
133
133
12
27
469
Net book amount at 31 March 2022
58
73
131
119
13
21
415
There were no indicators of material impairment as a result of climate-related matters in the current or prior year. The disposal of right-of-use assets for
Experian plc
Financial statements
196
2023
US$m
2022
US$m
At 1 April
4
128
Differences on exchange
1
(6)
Share of profit/(loss) after tax
1
(3)
Dividends received
(2)
(13)
Impairment charge
(18)
(25)
Reclassification as trade investment
—
(42)
Disposals
—
(6)
Transfer in respect of assets held-for-sale (note 43)
26
(29)
At 31 March
12
4
In the prior year we reclassified a UK associate as held-for-sale, and wrote down the carrying amount by US$25m. It is not now anticipated that the sale
will be completed within 12 months and accordingly the investment has been recorded as an associate at 31 March 2023; an additional write-down of
the carrying amount of US$18m was recorded upon its reclassification as an associate.
On 4 February 2022, Vector CM Holdings (Cayman) L.P., an associate undertaking, completed a merger with the CM Group involving its Cheetah Digital
business. As a result of the merger, the Group no longer has significant influence over Vector and accordingly our interest in this company was
recognised as a trade investment from that date. In the year ended 31 March 2022, we recorded a fair value gain on the associate disposal of US$95m
and the promissory note and associated interest due to Experian of US$110m were also repaid.
In the year ended 31 March 2022, we recognised a disposal of our Russian associate United Credit Bureau, and wrote off our investment, recording a loss
of US$17m.
2023
US$m
2022
US$m
Trade and unbilled receivables
1,237
1,083
Credit note provision
(34)
(20)
Trade receivables – after credit note provision
1,203
1,063
Contract assets
141
130
Trade receivables and contract assets
1,344
1,193
Loss allowance
(26)
(22)
Net trade receivables and contract assets
1,318
1,171
VAT and equivalent taxes recoverable
4
4
Prepayments
244
279
Contract costs
93
88
1,659
1,542
As reported in the Group balance sheet:
Current trade and other receivables
1,519
1,409
Non-current trade and other receivables
140
133
1,659
There is no material difference between the fair value and the book value stated above. Non-current trade and other receivables comprise prepayments,
contract assets, unbilled receivables and contract costs.
At 31 March 2021, the value of trade and unbilled receivables was US$923m and contract assets was US$151m.
2023
2022
Loss allowance
US$m
Gross carrying
amount
US$m
Loss allowance
US$m
Gross carrying
amount
US$m
Not past-due
(7)
1,027
(7)
937
Up to three months past-due
(2)
215
(1)
198
Three to six months past-due
(2)
43
(1)
27
Over six months past-due
(15)
59
(13)
31
Trade receivables and contract assets
(26)
1,344
(22)
1,193
Loss allowance (note 25(c))
(26)
(22)
Net trade receivables and contract assets
1,318
1,171
(c) Movements in the loss allowance
2023
US$m
2022
US$m
At 1 April
22
23
Increase in the loss allowance recognised in the Group income statement
10
3
Receivables written off in the year as uncollectable
(5)
(5)
Differences on exchange
(1)
1
At 31 March
26
(d) Analysis by currency denomination
Contract assets
Trade receivables
2023
US$m
2022
US$m
2023
US$m
2022
US$m
US dollar
69
47
695
571
Brazilian real
5
2
207
187
Pound sterling
16
11
160
157
Euro
27
27
50
50
Colombian peso
1
2
12
14
South African rand
10
5
8
10
Other
13
36
45
52
141
130
1,177
(a) Analysis by nature
2023
US$m
2022
US$m
Cash at bank and in hand
102
104
Short-term investments
100
75
202
179
The effective interest rate for cash and cash equivalents held at 31 March 2023 was 5.7% (2022: 1.2%). There is no material difference between the fair
value and the book value stated above.
(b) Analysis by external credit rating
2023
US$m
2022
US$m
Counterparty holding of more than US$2m:
A rated
139
130
B rated
44
22
Counterparty holding of more than US$2m
183
152
Counterparty holding of less than US$2m
19
27
202
25. Trade and other receivables continued
Experian plc
Financial statements
198
(a) Analysis by type and maturity
2023
2022
Current
US$m
Non-current
US$m
Current
US$m
Non-current
US$m
Trade payables
263
—
150
—
VAT and other equivalent taxes payable
28
—
35
—
Social security costs
131
—
117
—
Accruals
770
8
699
10
Contract liabilities
414
132
427
158
Other payables
349
46
316
80
1,955
186
1,744
248
There is no material difference between the fair value and the book value stated above. Other payables include interest payable of US$69m (2022: US$83m),
employee benefits of US$121m (2022: US$112m) and deferred and contingent consideration of US$143m (2022: US$116m).
At 31 March 2021, the value of contract liabilities was US$503m.
(b) Analysis by nature
2023
US$m
2022
US$m
Financial instruments
847
694
VAT and other equivalent taxes payable
28
35
Social security costs
131
117
Amounts within accruals and contract liabilities
1,135
1,146
Items other than financial instruments
1,294
1,298
2,141
1,992
28. Borrowings
(a) Analysis by carrying amounts and fair value
Fair value
2023
US$m
2022
US$m
2023
US$m
2022
US$m
Current:
Commercial paper
109
—
109
—
Bank overdrafts
4
3
4
3
Lease obligations (note 30)
43
54
43
54
156
57
156
57
Non-current:
Bonds:
£400m 2.125% Euronotes 2024
482
520
476
523
£400m 0.739% Euronotes 2025
496
525
449
497
€500m 1.375% Euronotes 2026
511
554
510
561
US$500m 4.25% Notes 2029
501
500
486
523
US$750m 2.75% Notes 2030
705
724
655
712
€500m 1.56% Euronotes 2031
551
553
463
546
£400m 3.25% Euronotes 2032
507
536
441
543
Bank loans
85
1
85
1
Lease obligations (note 30)
105
126
105
126
3,943
4,039
3,670
4,032
Total borrowings
4,099
4,096
3,826
The effective interest rates for bonds approximate to the coupon rates indicated above. Other than lease obligations, borrowings are unsecured.
Further information on the methodology used in determining fair values is given in note 32.
199
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
(b) Analysis by maturity
2023
US$m
2022
US$m
Less than one year
156
57
One to two years
600
44
Two to three years
521
549
Three to four years
527
544
Four to five years
12
564
Over five years
2,283
2,338
4,099
4,096
(c) Analysis by currency
2023
US$m
2022
US$m
US dollar
2,973
3,573
Pound sterling
417
432
Euro
671
53
Other
38
38
4,099
4,096
The above analysis takes account of the effect of cross-currency swaps and forward foreign exchange contracts and reflects the way in which the Group
manages its exposures.
(d) Undrawn committed bank borrowing facilities
2023
US$m
2022
US$m
Facilities expiring in:
One to two years
365
400
Two to three years
2,050
250
Three to four years
—
1,950
2,415
2,600
These facilities are at variable interest rates and are in place for general corporate purposes, including the financing of acquisitions and the refinancing
of other borrowings.
(e) Covenants and leverage ratio
There is one financial covenant in connection with the borrowing facilities. Benchmark EBIT must exceed three times net interest expense before
financing fair value remeasurements. The calculation of the financial covenant excludes the effects of IFRS 16. The Group monitors this, and the Net debt
to Benchmark EBITDA leverage ratio, and has complied with this covenant throughout the year.
(a) Analysis by nature
2023
US$m
2022
US$m
Cash and cash equivalents (net of overdrafts)
198
176
Debt due within one year – commercial paper
(109)
—
Debt due within one year – lease obligations
(42)
(53)
Debt due after more than one year – bonds and notes
(3,733)
(3,903)
Debt due after more than one year – bank loans
(85)
(2)
Debt due after more than one year – lease obligations
(105)
(126)
Derivatives hedging loans and borrowings
(154)
(42)
(4,030)
(3,950)
(b) Analysis by balance sheet caption
2023
US$m
2022
US$m
Cash and cash equivalents
202
179
Current borrowings
(156)
(57)
Non-current borrowings
(3,943)
(4,039)
Borrowings
(4,099)
(4,096)
Total of Group balance sheet line items
(3,897)
(3,917)
Accrued interest reported within borrowings excluded from Net debt
21
9
Derivatives reported within Other financial assets
4
20
Derivatives reported within Other financial liabilities
(158)
(62)
(4,030)
(3,950)
(c) Analysis of movements in Net debt
Derivatives
hedging
loans and
borrowings
US$m
Current
borrowings
US$m
Non-current
borrowings
US$m
Liabilities
from
financing
activities
US$m
Accrued
interest
US$m
Cash
and cash
equivalents
US$m
Net debt
US$m
At 1 April 2022
(42)
(57)
(4,039)
(4,138)
9
179
(3,950)
Cash flow
61
57
—
118
—
288
406
Borrowings cash flow
—
(109)
(83)
(192)
—
—
(192)
Reclassification of borrowings
—
(46)
46
—
—
—
—
Net interest paid
—
—
—
—
—
(118)
(118)
Movement on accrued interest
—
—
(12)
(12)
12
—
—
Net cash flow
61
(98)
(49)
(86)
12
170
96
Non-cash lease obligation additions and disposals
1
—
(2)
(27)
(29)
—
—
(29)
Principal lease payments
—
—
—
—
—
57
57
Net share purchases
—
—
—
—
—
(175)
(175)
Fair value gains/(losses)
(76)
—
29
(47)
—
—
(47)
Exchange and other movements
(97)
1
143
47
—
(29)
18
At 31 March 2023
(154)
(156)
(3,943)
(4,253)
21
202
(4,030)
Derivatives
hedging
loans and
borrowings
US$m
Current
borrowings
US$m
Non-current
borrowings
US$m
Liabilities
from
financing
activities
US$m
Accrued
interest
US$m
Cash
and cash
equivalents
US$m
Net debt
US$m
At 1 April 2021
111
(655)
(3,682)
(4,226)
20
180
(4,026)
Cash flow
16
56
1
73
—
(35)
38
Borrowings cash flow
—
583
(571)
12
—
—
12
Reclassification of borrowings
—
(45)
45
—
—
—
—
Net interest paid
—
—
—
—
—
121
121
Movement on accrued interest
—
11
—
11
(11)
—
—
Net cash flow
16
605
(525)
96
(11)
86
171
Non-cash lease obligation additions and disposals
1
—
(8)
(27)
(35)
—
—
(35)
Principal lease payments
—
—
—
—
—
57
57
Net share purchases
—
—
—
—
—
(149)
(149)
Additions through business combinations
—
(2)
—
(2)
—
—
(2)
Fair value gains/(losses)
(65)
4
40
(21)
—
—
(21)
Exchange and other movements
(104)
(1)
155
50
—
5
55
At 31 March 2022
(42)
(57)
(4,039)
(4,138)
9
179
(3,950)
1
29. Net debt (non-GAAP measure) continued
201
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
The Group’s lease portfolio consists of 43 (2022: 42) significant property leases across the countries in which we operate. In addition, we lease approximately
72 (2022: 104) smaller properties, 759 (2022: 757) motor vehicles, and a small number of hardware assets. The average remaining lease term is 3.6 years
(2022: 4.1 years) for significant property leases, 1.3 years (2022: 1.5 years) for other minor property leases and 1.9 years (2022: 1.9 years) for motor vehicles
and plant and equipment. Extension and termination options are included within a number of property and equipment leases across the Group. These are
used to maximise operational flexibility in terms of managing assets and lease exposures. The majority of extension and termination options are exercisable
only by the Group and not by the respective lessor.
(a) Amounts recognised in the Group balance sheet
Notes
2023
US$m
2022
US$m
Right-of-use assets:
Land and buildings
23
102
119
Motor vehicles
23
14
13
Plant and equipment
23
12
21
At 31 March
128
153
Lease obligations:
Current
28
43
54
Non-current
28
105
126
At 31 March
148
180
Sublease receivables at 31 March 2023 were US$9m (2022: US$11m), of which US$7m (2022: US$9m) falls due after more than one year.
Lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the
Group, the incremental borrowing rate is used. The incremental borrowing rate is unique to each country and class of assets therein and is based on the Group’s
cost of debt, adjusted for factors specific to individual lessees and their borrowing capacity.
The Group is exposed to potential future increases in variable lease payments based on an index or a rate, which are not included in the lease obligation until they
take effect.
(b) Maturity of lease obligations – contractual undiscounted cash flows
2023
US$m
2022
US$m
Less than one year
48
60
One to two years
37
49
Two to three years
27
32
Three to four years
18
21
Four to five years
13
12
Over five years
22
29
Total undiscounted lease obligations at 31 March
165
203
(c) Amounts recognised in the Group income statement
Notes
2023
US$m
2022
US$m
Depreciation charge for right-of-use assets:
Land and buildings
23
37
39
Motor vehicles
23
6
6
Plant and equipment
23
9
11
Total depreciation charge for right-of-use assets
52
56
Interest expense
16
7
8
Expense relating to the lease of low-value assets
5
10
Total
64
74
We had no material sublease income in the current or prior year.
(d) Amounts recognised in the Group cash flow statement
During the year lease payments of US$64m (2022: US$66m) comprised US$57m (2022: US$57m) for repayments of principal and US$7m (2022: US$9m)
for payments of interest.
(e) Lease commitments
The Group’s commitments for lease agreements where the term has not yet commenced total US$3m (2022: US$2m); such amounts are not recognised
Experian plc
Financial statements
202
(a) Financial assets and liabilities revalued through OCI
Assets
2023
2022
Current
US$m
Non-current
US$m
Total
US$m
Current
US$m
Non-current
US$m
Total
US$m
Cash flow hedge of borrowings (cross-currency swaps)
1
—
—
—
—
13
13
Listed investments
2
—
61
61
—
67
67
Trade investments
—
252
252
—
295
295
—
313
313
—
375
375
Liabilities
2023
2022
Current
US$m
Non-current
US$m
Total
US$m
Current
US$m
Non-current
US$m
Total
US$m
Cash flow hedge of borrowings (cross-currency swaps)
1
—
24
24
—
—
—
1
Derivatives designated as a cash flow hedge are in a documented hedge accounting relationship and consequently are revalued through OCI.
2
Listed investments includes investments held in the UK to secure certain unfunded pension arrangements (note 35(b)).
(i) Summary
Assets
2023
2022
Current
US$m
Non-current
US$m
Total
US$m
Current
US$m
Non-current
US$m
Total
US$m
Financial assets held at amortised cost
—
—
—
—
1
1
Non-hedging derivatives (equity swaps)
—
—
—
1
—
1
Non-hedging derivatives (foreign exchange contracts)
4
—
4
6
—
6
Non-hedging derivatives (interest rate swaps)
3
132
135
—
62
62
Other financial assets at fair value through profit or loss
—
16
16
—
18
18
Assets at fair value through profit or loss
7
148
155
7
80
87
Total other financial assets
7
148
155
7
81
88
Total other financial assets comprise:
Loans and receivables
—
—
—
—
1
1
Derivative financial instruments
7
132
139
7
62
69
Convertible loan notes
—
16
16
—
18
18
7
148
155
7
81
88
Liabilities
2023
2022
Current
US$m
Non-current
US$m
Total
US$m
Current
US$m
Non-current
US$m
Total
US$m
Derivative financial instruments:
Fair value hedge of borrowings (cross-currency swaps)
—
89
89
—
17
17
Fair value hedge of borrowings (interest rate swaps)
—
35
35
—
17
17
Derivatives used for hedging
1
—
124
124
—
34
34
Non-hedging derivatives (equity swaps)
3
2
5
—
2
2
Non-hedging derivatives (foreign exchange contracts)
3
—
3
18
—
18
Non-hedging derivatives (interest rate swaps)
—
12
12
1
3
4
Derivative financial instruments
2
6
138
144
19
39
58
Options in respect of non-controlling interests
—
33
33
3
187
190
Total other financial liabilities
6
171
177
22
226
248
1
Derivatives used for hedging are in documented hedge accounting relationships.
2
Derivative financial liabilities are valued at fair value through profit or loss (FVPL).
Amounts recognised in the Group income statement in connection with the Group’s hedging instruments are disclosed in note 16. There is no material
difference between the fair values and the book values stated above.
Financial assets held at amortised cost principally comprise amounts due following the disposal of businesses and include accrued interest. Other
financial assets at fair value through profit or loss comprise convertible loan notes purchased when acquiring interests in associates or minority
investments.
2023
2022
Assets
Liabilities
Assets
Liabilities
Fair value
US$m
Notional
US$m
Fair value
US$m
Notional
US$m
Fair value
US$m
Notional
US$m
Fair value
US$m
Notional
US$m
Cross-currency swaps
—
—
113
1,414
13
514
17
899
Interest rate swaps
135
1,750
47
550
62
1,600
21
900
Equity swaps
—
—
5
32
1
13
2
15
Foreign exchange contracts
4
408
3
176
6
515
18
839
139
2,158
168
2,172
82
2,642
58
2,653
Notional principal amounts are the amount of principal underlying the contracts at the reporting dates.
Assets
Liabilities
2023
US$m
2022
US$m
2023
US$m
2022
US$m
Reported in the Group balance sheet
139
82
168
58
Related amounts not offset in the Group balance sheet
(86)
(44)
(86)
(44)
Net amount
53
38
82
14
(c) Hedge accounting
(i) Fair value and cash flow hedges
We use interest rate swaps to hedge the interest rate risk arising on fixed rate borrowings, and cross-currency swaps to hedge the currency and interest
rate risk arising on foreign currency fixed rate borrowings. Our risk management strategy for interest rate risk and currency risk is outlined in note 8.
We determine the existence of an economic relationship between the hedging instruments and hedged items by comparing the currency, reference
interest rates, duration, repricing and maturity dates and the notional amounts of the hedging instruments to those of the hedged items.
We have established a hedge ratio of 1:1 for the hedging relationships, as the underlying risk of interest rate swaps and cross-currency swaps is
identical to the hedged risk components.
The main sources of ineffectiveness in the hedge accounting relationships are:
a
The application of different interest rate curves to discount the cash flows of the hedged item and those of the hedging instrument.
a
Differences in timing of cash flows of the hedged item and hedging instrument.
a
The different impact of the counterparty’s credit risk on the fair value movements of the hedging instrument compared to the hedged item.
(ii) Analysis of hedging instruments
The Group held the following instruments to hedge exposures to changes in foreign currency and interest rates.
At 31 March 2023
Maturity
Less than
one year
One to
two years
Two to
three years
Three to
four years
Four to
five years
Over
five years
Fair value hedges
Interest rate risk
Interest rate swaps:
Notional amount (US$m)
—
—
—
—
—
300
Weighted average fixed interest rate
—
—
—
—
—
1.66%
Cross-currency swaps:
Notional amount (US$m)
—
395
—
504
—
—
Weighted average fixed interest rate
—
2.13%
—
1.38%
—
—
Foreign currency risk
Cross-currency swaps:
Notional amount (US$m)
—
395
—
504
—
—
EUR:USD forward contract rate
—
—
—
1.12
—
—
GBP:USD forward contract rate
—
1.32
—
—
—
—
Cash flow hedge
Foreign currency risk
Cross-currency swaps:
Notional amount (US$m)
—
—
515
—
—
—
GBP:USD forward contract rate
—
—
1.29
—
—
—
At 31 March 2022
Maturity
Less than
one year
One to
two years
Two to
three years
Three to
four years
Four to
five years
Over
five years
Fair value hedges
Interest rate risk
Interest rate swaps:
Notional amount (US$m)
—
—
—
—
—
300
Weighted average fixed interest rate
—
—
—
—
—
1.66%
Cross-currency swaps:
Notional amount (US$m)
—
—
395
—
504
—
Weighted average fixed interest rate
—
—
2.13%
—
1.38%
—
Foreign currency risk
Cross-currency swaps:
Notional amount (US$m)
—
—
395
—
504
—
EUR:USD forward contract rate
—
—
—
—
1.12
—
GBP:USD forward contract rate
—
—
1.32
—
—
—
Cash flow hedge
Foreign currency risk
Cross-currency swaps:
Notional amount (US$m)
—
—
—
515
—
—
GBP:USD forward contract rate
—
—
—
1.29
—
—
(d) Impact of hedging instruments
2023
Notional amount of
hedging instrument
US$m
Carrying amount of hedging instrument
Changes in fair value used
for calculating hedge
ineffectiveness (Note 16(c))
US$m
Assets
US$m
Liabilities
US$m
Fair value hedges
Interest rate risk
Interest rate swaps
300
—
(35)
17
Cross-currency swaps
899
—
(89)
41
Foreign exchange risk
Cross-currency swaps
899
—
(89)
31
Cash flow hedge
Foreign exchange risk
Cross-currency swaps
515
—
(24)
38
2022
Notional amount of
hedging instrument
US$m
Carrying amount of hedging instrument
Changes in fair value used
for calculating hedge
ineffectiveness (Note 16(c))
US$m
Assets
US$m
Liabilities
US$m
Fair value hedges
Interest rate risk
Interest rate swaps
300
—
(17)
19
Cross-currency swaps
899
—
(17)
43
Foreign exchange risk
Cross-currency swaps
899
—
(17)
55
Cash flow hedge
Foreign exchange risk
Cross-currency swaps
515
13
—
24
Except for the cash flow hedge, interest rate and cross-currency swaps are reported within Other financial assets and Other financial liabilities in the
Group balance sheet. Cross-currency swaps in respect of the cash flow hedge are reported within Financial assets revalued through OCI or Financial
liabilities revalued through OCI, in the Group balance sheet.
(e) Impact of hedged items
2023
2022
Carrying amount
of hedged item
Accumulated
amount of fair
value hedge
adjustments
included in
the carrying
amount of the
hedged item
Changes in fair
value used for
calculating hedge
ineffectiveness
(Note 16(c))
US$m
Carrying amount
of hedged item
Accumulated
amount of fair
value hedge
adjustments
included in
the carrying
amount of the
hedged item
Changes in fair
value used for
calculating hedge
ineffectiveness
(Note 16(c))
US$m
Liabilities
Liabilities
US$m
US$m
US$m
US$m
Fair value hedges
Interest rate risk
Borrowings
(1,073)
(93)
(59)
(1,165)
(31)
(69)
Foreign exchange risk
Borrowings
(814)
(37)
(35)
(886)
(5)
(51)
Cash flow hedge
Foreign exchange risk
Borrowings
(496)
n/a
(38)
(525)
n/a
(24)
The hedging reserve at 31 March 2023 includes a debit of US$4m (2022: credit of US$4m) in respect of the cash flow hedge. Borrowings are reported
within Borrowings in the Group balance sheet.
(f) Impact of hedge ineffectiveness
Fair value hedges (Note 16(c))
2023
US$m
2022
US$m
Interest rate risk
(1)
(7)
Foreign exchange risk
(4)
4
Gains on items in hedging relationships – hedge ineffectiveness
(5)
(3)
Hedge ineffectiveness is reported within Net finance costs in the Group income statement.
2023
2022
Level 1
US$m
Level 2
US$m
Level 3
US$m
Total
US$m
Level 1
US$m
Level 2
US$m
Level 3
US$m
Total
US$m
Financial assets:
Non-hedging derivatives
—
139
—
139
—
69
—
69
Other financial assets at fair value through profit or loss
—
—
16
16
—
—
18
18
Financial assets at fair value through profit or loss (note 31(b))
—
139
16
155
—
69
18
87
Derivatives used for hedging – cash flow hedge
1
—
—
—
—
—
13
—
13
Listed and trade investments
61
—
252
313
67
—
295
362
Financial assets revalued through OCI (note 31(a))
61
—
252
313
67
13
295
375
61
139
268
468
67
82
313
462
Financial liabilities:
Derivatives used for hedging – fair value hedges
—
(124)
—
(124)
—
(34)
—
(34)
Non-hedging derivatives
—
(20)
—
(20)
—
(24)
—
(24)
Other liabilities at fair value through profit or loss
—
—
(139)
(139)
—
—
(107)
(107)
Financial liabilities at fair value through profit or loss (note 31(b))
—
(144)
(139)
(283)
—
(58)
(107)
(165)
Derivatives used for hedging – cash flow hedge
1
—
(24)
—
(24)
—
—
—
—
Options in respect of non-controlling interests
—
—
(33)
(33)
—
—
(190)
(190)
—
(168)
(172)
(340)
—
(58)
(297)
(355)
Net financial assets/(liabilities)
61
(29)
96
128
67
24
16
107
1
Derivatives designated as a cash flow hedge are revalued through OCI.
The analysis by level is a requirement of IFRS 13 and the definitions are summarised here for completeness:
a
assets and liabilities whose valuations are based on unadjusted quoted prices in active markets for identical assets and liabilities are classified as
Level 1;
a
assets and liabilities which are not traded in an active market, and whose valuations are derived from available market data that is observable for the
asset or liability, are classified as Level 2; and
a
assets and liabilities whose valuations are derived from inputs not based on observable market data are classified as Level 3.
Level 3 items principally comprise minority shareholdings in unlisted businesses, trade investments, contingent consideration and put options
associated with corporate transactions.
Unlisted equity investments, initially measured at cost, are revalued where sufficient indicators are identified that a change in the fair value has occurred.
The inputs to any subsequent valuations are based on a combination of observable evidence from external transactions in the investee’s equity and
estimated discounted cash flows that will arise from the investment. Valuations of material contingent consideration, and put options associated with
corporate transactions, are based on Monte Carlo simulations using the most recent management expectations of relevant business performance,
reflecting the different contractual arrangements in place.
There would be no material effect on the amounts stated from any reasonably possible change in such inputs at 31 March 2023. There were no transfers
between levels during the year. In the year ended 31 March 2022 a Level 3 investment was reclassified to Level 1. Further details are provided in note
31(h).
(h) Analysis of movements in Level 3 financial assets/(liabilities)
Year ended 31 March 2023
Year ended 31 March 2022
Financial
assets
revalued
through
OCI
US$m
Other
financial
assets
at FVPL
US$m
Contingent
consideration
US$m
Put
options
US$m
Total
US$m
Financial
assets
revalued
through
OCI
US$m
Other
financial
assets
at FVPL
US$m
Contingent
consideration
US$m
Put
options
US$m
Total
US$m
At 1 April
295
18
(107)
(190)
16
164
12
(66)
(220)
(110)
Additions
1,2
14
1
(35)
(11)
(31)
24
8
(46)
(11)
(25)
Reclassification of associate to trade
investment (note 24)
—
—
—
—
—
138
—
—
—
138
Reclassification of Level 3 investment to
Level 1
3
—
—
—
—
—
(30)
—
—
—
(30)
Disposals
4
(6)
—
—
—
(6)
(12)
—
—
—
(12)
Settlement of contingent consideration
—
—
40
—
40
—
—
36
—
36
Cash payment on exercise of put options
5
—
—
—
133
133
—
—
—
4
4
Adjustment to the fair value of contingent
consideration
2
—
—
(45)
—
(45)
—
—
(26)
—
(26)
Valuation gains/(losses) recognised in the
Group income statement
6
—
(2)
—
26
24
—
—
—
29
29
Valuation (losses)/gains recognised in OCI
(52)
—
—
—
(52)
10
—
—
—
10
Currency translation gains/(losses)
recognised directly in OCI
—
—
4
9
13
(2)
—
(6)
8
—
Other
1
(1)
4
—
4
3
(2)
1
—
2
At 31 March
252
16
(139)
(33)
96
295
18
(107)
(190)
16
1
Additions to put options in the year ended 31 March 2023 comprised US$11m in respect of the acquisition of APC Buró, and in the year ended 31 March 2022 included US$13m in respect of the acquisition of
Servicios de Información Avanzada Comercial Y Financiera S.A. (Sinacofi Buró).
2
Additions to contingent consideration comprised US$35m (2022: US$46m) in respect of acquisitions. Contingent consideration in relation to the acquisition of Tax Credit Co, LLC (TCC) in FY22 increased by US$49m
following fair value adjustments recognised in the year, which are determined by revenue and profit performance up to and including FY25. This was offset by a reduction in the fair value of contingent consideration
on other acquisitions of US$4m. There are limits in place for contingent consideration payments, including up to US$80m in respect of TCC. Contingent liabilities are revalued at each reporting date based on current
projections of their associated targets, with any fair value remeasurements recognised as a non-benchmark item in the Group income statement (note 15(a)).
3
Our investment in Grab Holdings Limited was reclassified as a Level 1 investment following Nasdaq listing in the year ended 31 March 2022.
4
During the year ended 31 March 2023, we disposed of a trade investment valued at US$6m, US$3m of the consideration is deferred.
5
The cash payment on exercise of put options in the year ended 31 March 2023, relates to the purchase of the remaining 40% stake in the Arvato Financial Solutions Risk Management Division.
6
32. Fair value methodology
Information in respect of the carrying amounts and the fair value of borrowings is included in note 28(a). There are no material differences between the
carrying value of the Group’s other financial assets and liabilities not measured at fair value and their estimated fair values. The following assumptions
and methods are used to estimate the fair values:
a
the fair values of receivables, payables and cash and cash equivalents are considered to approximate to the carrying amounts;
a
the fair values of short-term borrowings, other than bonds, are considered to approximate to the carrying amounts due to the short maturity terms of
such instruments;
a
the fair value of that portion of bonds carried at amortised cost is based on quoted market prices, employing a valuation methodology falling within
Level 1 of the IFRS 13 fair value hierarchy;
a
the fair value of listed investments is based on quoted market prices, employing a valuation methodology falling within Level 1 of the IFRS 13 fair
value hierarchy;
a
the fair values of long-term variable rate bank loans and lease obligations are considered to approximate to the carrying amount; and
a
the fair values of other financial assets and liabilities are calculated based on a discounted cash flow analysis, using a valuation methodology falling
within Level 2 of the IFRS 13 fair value hierarchy, apart from the fair values of trade investments and contingent consideration which use a valuation
methodology falling within Level 3 of the IFRS 13 fair value hierarchy.
The Group considers the impact of climate-related matters, including legislation, on the fair value measurement of assets and liabilities. At present, the
31. Financial assets and liabilities continued
Experian plc
Financial statements
208
At 31 March 2023
Less than
one year
US$m
One to
two years
US$m
Two to
three years
US$m
Three to
four years
US$m
Four to
five years
US$m
Over
five years
US$m
Total
US$m
Borrowings
252
706
601
636
80
2,542
4,817
Net settled derivative financial instruments – interest rate swaps
19
18
16
16
16
26
111
Gross settled derivative financial instruments:
Outflows for derivative contracts
229
436
546
510
—
—
1,721
Inflows for derivative contracts
(194)
(390)
(506)
(497)
—
—
(1,587)
Gross settled derivative financial instruments
35
46
40
13
—
—
134
Options in respect of non-controlling interests
—
—
9
11
—
13
33
Trade and other payables
793
32
17
2
3
—
847
Cash outflows
1,099
802
683
678
99
2,581
5,942
At 31 March 2022
Less than
one year
US$m
One to
two years
US$m
Two to
three years
US$m
Three to
four years
US$m
Four to
five years
US$m
Over
five years
US$m
Total
US$m
Borrowings
146
141
647
625
642
2,609
4,810
Net settled derivative financial instruments – interest rate swaps
6
5
—
(1)
(1)
(7)
2
Gross settled derivative financial instruments:
Outflows for derivative contracts
861
19
411
12
506
—
1,809
Inflows for derivative contracts
(839)
(15)
(409)
(7)
(506)
—
(1,776)
Gross settled derivative financial instruments
22
4
2
5
—
—
33
Options in respect of non-controlling interests
2
—
—
8
168
18
196
Trade and other payables
604
74
4
1
8
3
694
Cash outflows
780
224
653
638
817
2,623
5,735
The table above analyses financial liabilities into maturity groupings, based on the period from the balance sheet date to the contractual maturity date.
As the amounts disclosed are the contractual undiscounted cash flows, they differ from the carrying values and fair values. Contractual undiscounted
209
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
(a) Cost of share-based compensation
2023
US$m
2022
US$m
Share awards
121
142
Share options
8
7
Expense recognised (all equity-settled)
129
149
Charge for associated social security obligations
13
9
Total expense recognised in the Group income statement
142
158
The Group has a number of equity-settled, share-based employee incentive plans. Further information on share award arrangements is given in note
34(b). As the numbers of share options granted or outstanding and the related charge to the Group income statement are not significant, no further
disclosures are included in these financial statements.
(b) Share awards
(i) Summary of arrangements and performance conditions
There are three plans under which share awards are currently granted – the two Experian Co-investment Plans (the CIP) and the Experian Performance
Share Plan (the PSP). Awards typically take the form of a grant of free shares which vest over a service period of three years, with a maximum term
generally of the same length, and are settled by share distribution. The assumption at grant date for employee departures prior to vesting is 20% for
certain unconditional awards, which are only made under the PSP. Other details in respect of conditional awards are given below.
During the year ended 31 March 2021, a one-off award was made under the PSP to employees who are not eligible to participate in existing share award
schemes. These awards had no service or performance conditions attached and vested immediately. Participants who hold the shares received for three
years will be entitled to receive two matching shares for each share they originally received. The grant date assumption is that 30% of these matching
awards will not vest.
CIP
For the purposes of IFRS 2, the grant date for these plans is the start of the financial year in which performance is assessed. This is before the number
of shares to be awarded is determined but the underlying value of the award is known, subject to the outcome of the performance condition. The value
of awarded shares reflects the performance outcome assumed at the date of their issue to participants and is recognised over a four-year period.
The range of performance conditions for awards under these plans is set out below. The Profit performance condition requires adjusted Benchmark
EPS growth at the stated percentages over a three-year period. The cumulative Benchmark operating cash flow performance condition (the Cash flow
condition) is based on cumulative Benchmark operating cash flow over a three-year period. The period of assessment commences at the beginning
of the financial year of grant. These are not market-based performance conditions as defined by IFRS 2.
PSP
The range of Profit performance conditions for conditional awards under this plan is the same as those for the CIP described above. The Return on
Capital Employed condition (ROCE condition) requires average ROCE over the period at the percentages stated below. Both these conditions are not
market-based performance conditions as defined by IFRS 2 and are also measured over a three-year period commencing at the beginning of the
financial year of grant.
The TSR performance condition is considered a market-based performance condition as defined by IFRS 2. In valuing the awarded shares, TSR is
evaluated using a Monte Carlo simulation, with historical volatilities and correlations for comparator companies measured over the three-year period
preceding valuation and an implied volatility for Experian plc ordinary shares.
Experian plc
Year ended
31 March 2023
31 March 2022
31 March 2021
CIP
PSP
CIP
PSP
CIP
PSP
Profit condition:
Proportion of awards subject to
condition
50%
50%
50%
50%
50%
50%
Minimum payout requirement
6% per annum
6% per annum
5% per annum
5% per annum
3% per annum
3% per annum
Target payout requirement
8% per annum
8% per annum
7% per annum
7% per annum
4% per annum
4% per annum
Maximum payout requirement
10% per annum
10% per annum
10% per annum
10% per annum
7% per annum
7% per annum
Assumed outcome at grant date
75.0%
75.0%
66.7%
66.7%
77.8%
77.8%
Cash flow condition:
Proportion of awards subject to
condition
50%
50%
50%
Minimum payout requirement
US$5.0bn
US$4.0bn
US$3.7bn
Target payout requirement
US$5.2bn
US$4.2bn
US$3.8bn
Maximum payout requirement
US$5.4bn
US$4.4bn
US$4.1bn
Assumed outcome at grant date
76.5%
64.5%
77.8%
ROCE condition:
Proportion of awards subject to
condition
25%
25%
25%
Minimum payout requirement
14.5% per annum
14.5% per annum
14.5% per annum
Target payout requirement
15.4% per annum
15.4% per annum
15.4% per annum
Maximum payout requirement
16.0% per annum
16.0% per annum
16.0% per annum
Assumed outcome at grant date
64%
72%
83%
TSR condition:
Proportion of awards subject to
condition
25%
25%
25%
Assumed outcome at grant date
61.8%
61.8%
61.8%
(ii) Information on share grant valuations
Share grants are valued by reference to the market price on the day of award, with no modification for dividend distributions or other factors, as
participants are entitled to dividend distributions on awarded shares. Market-based performance conditions are included in the fair value measurement
on the grant date and are not revised for actual performance. Awards granted in the year ended 31 March 2023 had a weighted average fair value per
share of £24.65 (2022: £27.25).
(iii) Share awards outstanding
2023
million
2022
million
At 1 April
11.1
10.9
Grants
5.4
4.6
Forfeitures
(0.6)
(0.8)
Lapse of awards
—
(0.3)
Vesting
(3.7)
(3.3)
At 31 March
12.2
11.1
Analysis by plan:
CIP
3.9
3.6
PSP – conditional awards
2.9
2.7
PSP – unconditional awards
5.4
4.8
At 31 March
12.2
34. Share incentive plans continued
(i) Summary of arrangements and performance conditions continued
211
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
35. Post-employment benefit plans and related risks
An overview of the Group’s post-employment benefit plans and the related risks is given below. The additional information required by IAS 19, which
relates only to the Group’s defined benefit pension plans and post-employment medical benefits obligations, is set out in note 36.
(a) Funded pension plans
The Group’s principal defined benefit plan is the Experian Pension Scheme in the UK. The plan was closed to new entrants in 2009 and to the future
accrual of new benefits from 1 April 2022. Active member benefits were crystallised as deferred pensions from that date. No material impact on the
Group’s net post-employment benefit assets resulted from this change. All UK employees were offered membership of the Group’s UK defined
contribution plan from April 2022.
The Experian Pension Scheme has rules which specify the benefits to be paid, with the level of pension benefit payable on retirement dependent on age,
length of service and salary. As at 31 March 2023, there were no (2022: 86) active members of this plan, 1,224 (2022: 1,239) deferred members and
2,424 (2022: 2,462) pensioner members.
A full actuarial funding valuation of the Experian Pension Scheme is carried out every three years, with interim reviews in the intervening years.
The latest full valuation was carried out as at 31 March 2022 by independent qualified actuaries Mercer Limited, using the projected unit credit method.
The 2022 actuarial valuation has been agreed and there was a moderate funding surplus. The next full valuation will be carried out as at 31 March 2025.
The Experian Pension Scheme is governed by a trust deed, which ensures that its finances and governance are independent from those of the Group.
Trustees are responsible for overseeing the investments and funding of the plans and plan administration. The UK pensions environment is regulated by
The Pensions Regulator whose statutory objectives and regulatory powers are described on its website at
www.thepensionsregulator.gov.uk.
The defined contribution plan for UK employees was formerly the Experian Retirement Savings Plan, however during the year ended 31 March 2022 the
assets of this plan were transferred to a new plan, the Experian Pensions Savings Plan, which is part of a mastertrust managed by Legal and General
Group plc. Under the new plan, as before, employee and employer contributions are paid by the Group into an independently administered fund, which is
used to fund member pensions at retirement. As at 31 March 2023, there were 3,484 active members of this plan (2022: 3,195).
Employees in the USA, Brazil and South Africa have the option to join local defined contribution plans and, as at 31 March 2023, there were 5,480 (2022:
4,666) active members in the USA, 1,273 (2022: 1,151) in Brazil and 426 (2022: 513) in South Africa. There are no other material funded pension
arrangements.
(b) Unfunded pension arrangements
The Group’s unfunded pension arrangements are designed to ensure that certain senior managers who are affected by the earnings cap, which was
introduced by the UK government some years ago to set a ceiling on the amount of benefits that could be paid by defined benefit pension plans, are
placed in broadly the same position as those who are not. There are also unfunded arrangements for certain former directors and employees of
Experian Finance plc and Experian Limited. Certain of these unfunded arrangements in the UK have been secured by the grant to an independent trustee
of charges over an independently managed portfolio of marketable securities owned by the Group and reported as financial assets revalued through OCI
(note 31(a)). Benefit accrual under the unfunded arrangements ceased from 1 April 2022.
(c) Post-employment medical benefits
The Group operates a plan which provides post-employment medical benefits to certain retired employees and their dependant relatives. This plan
relates to former employees in the UK and, under it, the Group has undertaken to meet the cost of post-employment medical benefits for all eligible
former employees who retired prior to 1 April 1994, and their dependants.
(d) Related risks
Through its defined benefit pension plans and post-employment medical benefits plan, the Group is exposed to a number of risks that are inherent in
such plans and arrangements, which can be summarised as follows:
a
asset value volatility, with the associated impact on the assets held in connection with the funding of pension obligations and the related cash flows;
a
changes in bond yields, with any reduction resulting in an increase in the present value of pension obligations, mitigated by an increase in the value of
plan assets;
a
inflation, as pension obligations are generally linked to inflation and the prevailing rate of inflation experienced for medical benefits is typically higher
than other inflation measures in the UK; and
a
life expectancy, as pension and medical benefits are generally provided for the life of beneficiaries and their dependants.
There are no unusual, entity-specific or plan-specific risks, and no significant concentrations of risk.
Experian plc
Financial statements
212
36. Post-employment benefits – IAS 19 information
(a) Post-employment benefit amounts recognised in the Group financial statements
(i) Balance sheet assets/(obligations)
2023
US$m
2022
US$m
Retirement benefit assets/(obligations) – funded defined benefit plans:
Fair value of funded plans' assets
866
1,214
Present value of funded plans' obligations
(692)
(998)
Assets in the Group balance sheet for funded defined benefit pensions
174
216
Obligations for unfunded post-employment benefits:
Present value of defined benefit pensions – unfunded plans
(36)
(48)
Present value of post-employment medical benefits
(3)
(4)
Liabilities in the Group balance sheet
(39)
(52)
Net post-employment benefit assets
135
164
Pension assets are deemed to be recoverable and there are no adjustments in respect of minimum funding requirements as, under the rules of the UK
Experian Pension Scheme, future economic benefits are available to the Group in the form of reductions in future contributions or refunds of surplus.
(ii) Income statement (credit)/charge
2023
US$m
2022
US$m
By nature of expense:
Current service cost
—
5
Administration expenses
2
3
Charge within labour costs and operating profit
2
8
Interest income
(4)
(1)
Total net (credit)/charge to the Group income statement
(2)
7
There is no current service cost in the year ended 31 March 2023, due to the closure of the Experian Pension Scheme to future accrual from 1 April 2022.
(iii) Remeasurement recognised in the statement of comprehensive income
2023
US$m
2022
US$m
Defined benefit pensions
(24)
121
Post-employment medical benefits
1
—
(23)
121
(b) Movements in net post-employment benefit assets/(obligations) recognised in the Group balance sheet
Fair value of
plan assets
US$m
Present value of obligations
Movements in
net position
US$m
Defined
benefit
pensions
– funded
US$m
Defined
benefit
pensions
– unfunded
US$m
Post-
employment
medical
benefits
US$m
Total
US$m
At 1 April 2022
1,214
(998)
(48)
(4)
(1,050)
164
Income statement credit/(charge):
Administration expenses
(2)
—
—
—
—
(2)
Interest income/(expense)
31
(25)
(2)
—
(27)
4
Total credit/(charge) to the Group income statement
29
(25)
(2)
—
(27)
2
Remeasurements:
Return on plan assets other than interest
(259)
—
—
—
—
(259)
Gains from change in demographic assumptions
—
15
1
—
16
16
Gains from change in financial assumptions
—
252
9
1
262
262
Experience losses
—
(41)
(1)
—
(42)
(42)
Remeasurement of post-employment benefit assets
and obligations
(259)
226
9
1
236
(23)
Differences on exchange
(76)
63
3
—
66
(10)
Contributions paid by the Group
2
—
—
—
—
2
Benefits paid
(44)
42
2
—
44
—
At 31 March 2023
866
(692)
(36)
(3)
(731)
135
213
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
Fair value of
plan assets
US$m
Present value of obligations
Movements in
net position
US$m
Defined
benefit
pensions
– funded
US$m
Defined
benefit
pensions
– unfunded
US$m
Post-
employment
medical
benefits
US$m
Total
US$m
At 1 April 2021
1,274
(1,172)
(51)
(4)
(1,227)
47
Income statement (charge)/credit:
Current service cost
—
(5)
—
—
(5)
(5)
Administration expenses
(3)
—
—
—
—
(3)
Interest income/(expense)
25
(23)
(1)
—
(24)
1
Total (charge)/credit to the Group income statement
22
(28)
(1)
—
(29)
(7)
Remeasurements:
Return on plan assets other than interest
19
—
—
—
—
19
Gains from change in demographic assumptions
—
1
—
—
1
1
Gains from change in financial assumptions
—
87
2
—
89
89
Experience gains/(losses)
—
13
(1)
—
12
12
Remeasurement of post-employment benefit assets
and obligations
19
101
1
—
102
121
Differences on exchange
(60)
52
1
—
53
(7)
Contributions paid by the Group and employees
11
(1)
—
—
(1)
10
Benefits paid
(52)
50
2
—
52
—
At 31 March 2022
1,214
(998)
(48)
(4)
(1,050)
164
(c) Actuarial assumptions and sensitivities
The accounting valuations at 31 March 2023 have been based on the most recent actuarial valuations, updated to take account of the requirements of
IAS 19. The assumptions for the real discount rate, pension increases and mortality, used to calculate the present value of the defined benefit obligations,
all have a significant effect on the accounting valuation.
The mortality and early retirement assumptions have been updated to reflect the latest analysis that has been undertaken as part of the full actuarial
funding valuation at 31 March 2022.
The assumed margin between RPI and CPI has been reduced to 45 basis points (50 basis points in the year ended 31 March 2022), consistent with a 100
basis point margin assumed to 2030, with a ten basis point margin assumed thereafter. The single equivalent differential is expected to reduce over time
towards 2030. This results in an increase in retirement benefit obligations at 31 March 2023 of approximately US$2m or 0.25%.
The other methods and assumptions used are consistent with those used in the prior year. Changes to these assumptions in the light of prevailing
conditions may have a significant impact on future valuations. Indications of the sensitivity of the amounts reported at 31 March 2023 to changes in the
real discount rate, pension increases, life expectancy and medical costs are included below.
The absolute sensitivity numbers are stated on a basis consistent with the methodology used in determining the accounting valuation as at 31 March
2023. The methodology evaluates the effect of a change in each assumption on the relevant obligations, while holding all other assumptions constant.
(i) Financial actuarial assumptions
2023
% p.a.
2022
% p.a.
Discount rate
4.9
2.8
Inflation rate – based on the UK Retail Prices Index (the RPI)
3.3
3.8
Inflation rate – based on the UK Consumer Prices Index (the CPI)
2.9
3.3
Increase for pensions in payment – element based on the RPI (where cap is 5%)
3.1
3.4
Increase for pensions in payment – element based on the CPI (where cap is 2.5%)
1.9
2.0
Increase for pensions in payment – element based on the CPI (where cap is 3%)
2.1
2.3
Increase for pensions in deferment
2.9
3.3
Inflation in medical costs
6.3
6.8
The principal financial assumption is the real discount rate, which is the excess of the discount rate over the rate of inflation. The discount rate is based
on the market yields on high-quality corporate bonds of a currency and term appropriate to the defined benefit obligations. The criteria used to set the
discount rate are unchanged from the year ended 31 March 2022. The increase in the discount rate at the balance sheet date reflects the significant
increase in UK bond yields during the year. The Experian Pension Scheme obligations are in pounds sterling and have a maturity on average of 13 years.
If the real discount rate increased/decreased by 0.25%, the defined benefit obligations at 31 March 2023 would decrease/increase by approximately
US$22m and the fair value of plan assets would decrease/increase by approximately US$27m.
36. Post-employment benefits – IAS 19 information continued
(b) Movements in net post-employment benefit assets/(obligations) recognised in the Group balance sheet continued
Experian plc
Financial statements
214
36. Post-employment benefits – IAS 19 information continued
(i) Financial actuarial assumptions continued
The discount rate sensitivity has been updated to 0.25% from 0.1% to reflect an increase in both the range of reasonably possible rates and the
estimation uncertainty for discount rates, given the increase in UK discount rates and their volatility observed during the year.
The rates of increase for pensions in payment reflect the separate arrangements applying to different groups of Experian’s pensioners. If the inflation
rate underlying the pension increases (both in payment and in deferment) increased/decreased by 0.1%, the defined benefit obligations at 31 March
2023 would increase/decrease by approximately US$5m.
(ii) Mortality assumptions – average life expectancy on retirement at age 65 in normal health
2023
years
2022
years
For a male currently aged 65
22.2
22.6
For a female currently aged 65
24.2
24.5
For a male currently aged 50
23.1
23.5
For a female currently aged 50
25.3
25.6
The accounting valuation assumes that mortality will be in line with standard tables adjusted to reflect the expected experience of the Experian Pension
Scheme membership, based on analysis carried out for the 2022 actuarial valuation. A specific allowance for anticipated future improvements in life
expectancy is also incorporated. The perpetuation of excess deaths during 2022 is expected to be reflected in the standard UK model for projected
improvements in life expectancy, due to be published later this calendar year. The Group has therefore applied a 4% scaling factor to its mortality
assumptions to allow for this impact on member mortality. This reduced retirement benefit obligations at 31 March 2023 by approximately US$8m.
The Group has also considered the potential impact of climate change and, at the present time, we do not believe that there is sufficient evidence to
require a change in the long-term mortality assumptions. We will continue to monitor any potential future impact on the mortality assumptions used.
An increase in assumed life expectancy of 0.1 years would increase the defined benefit obligations at 31 March 2023 by approximately US$2m.
(iii) Post-employment medical benefits
The accounting valuation in respect of post-employment medical benefits assumes a rate of increase for medical costs. If this rate increased/decreased
by 1.0% per annum, the obligations at 31 March 2023 and the finance expense would remain unchanged.
(d) Assets of the Group’s defined benefit plans at fair value
2023
2022
US$m
%
US$m
%
Equities
86
9
146
12
Index-linked gilts/Liability Driven Investments
284
33
450
37
Global corporate bonds
257
30
355
29
Secured credit
145
17
184
15
Senior private debt
51
6
52
4
Other
43
5
27
3
866
100
1,214
100
The funded defined benefit pension plans hold a range of assets including equities, index-linked gilts, global corporate bonds, secured credit, senior
private debt and a Liability Driven Investment strategy which is used to hedge against interest fluctuations and inflation. Collateral levels within the
Liability Driven Investment strategy were closely monitored during the market disruptions of Autumn 2022 and remained robust throughout.
The primary drivers of the reductions in the fair value of the plans’ funded assets and obligations are an increase in pound sterling interest rates and the
retranslation of assets and obligations into US dollars.
The Experian Pension Scheme investment strategy aims to reduce investment risk and funding volatility. With the exception of the allocation to senior
private debt, all other assets are regarded as being marketable and regularly traded. Over time, the Scheme is expected to increase its allocation to
liability matching assets, to provide cash flows to match expected benefit payments.
Other assets listed above mainly relate to cash in transit between investment managers and cash held for benefit payments, together with a small
with-profits investment.
The Trustee believes that Environmental, Social and Governance (ESG) factors may have a material impact on investment risk and return outcomes.
ESG factors, including climate change and stewardship, are increasingly integrated within investment processes both in appointing new investment
managers and in monitoring existing investment managers. Monitoring is undertaken and documented on a regular basis, making use of the investment
consultant’s ESG rating framework.
The Group’s defined benefit plans have no holdings of ordinary shares or debt of the Company.
(e) Future payments
Payments of US$3m are currently expected to be made during the year ending 31 March 2024 in respect of unfunded post-employment benefits.
215
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
37. Deferred and current tax
(a) Deferred tax
(i) Net deferred tax assets/(liabilities)
The net deferred tax liability at the end of the year is presented in the Group balance sheet as:
2023
US$m
2022
US$m
Deferred tax assets
37
46
Deferred tax liabilities
(223)
(353)
Net deferred tax liability
(186)
(307)
(ii) Movements in net deferred tax assets/(liabilities)
Other
intangible
assets
(excluding
goodwill)
US$m
Goodwill
US$m
Tax losses
and credits
US$m
Share
incentive
plans
US$m
Accelerated
depreciation
US$m
Retirement
benefit
assets/
(obligations)
US$m
Accounting
provisions and
accruals
US$m
Deferred
interest
US$m
Total
US$m
At 1 April 2022
(230)
(347)
96
50
(8)
(42)
149
25
(307)
Differences on exchange
5
5
(3)
—
(2)
(1)
(2)
—
2
(Charge)/credit recognised in the Group income
statement
71
(35)
(30)
1
93
3
18
(1)
120
Additions through business combinations
(4)
—
—
—
—
—
—
—
(4)
(Charge)/credit recognised within OCI
—
—
—
—
—
8
(3)
—
5
(Charge) recognised directly in equity on transactions
with owners
—
—
—
(4)
—
—
—
—
(4)
Transfers
—
—
2
—
—
—
—
—
2
At 31 March 2023
(158)
(377)
65
47
83
(32)
162
24
(186)
Re-presented
Other
intangible
assets
(excluding
goodwill)
1
US$m
Goodwill
1
US$m
Tax losses
and credits
US$m
Share
incentive
plans
US$m
Accelerated
depreciation
US$m
Retirement
benefit
assets/
(obligations)
1
US$m
Accounting
provisions and
accruals
1
US$m
Deferred
interest
1
US$m
Total
US$m
At 1 April 2021
(244)
(289)
108
36
(9)
(10)
112
21
(275)
Differences on exchange
5
(17)
—
—
(1)
—
6
—
(7)
(Charge)/credit recognised in the Group income
statement
28
(41)
(12)
14
2
(10)
33
4
18
Additions through business combinations
(19)
—
—
—
—
—
(3)
—
(22)
(Charge) recognised within OCI
—
—
—
—
—
(22)
—
—
(22)
Credit recognised directly in equity on transactions
with owners
—
—
—
1
—
—
—
—
1
Transfers
—
—
—
(1)
—
—
1
—
—
At 31 March 2022
(230)
(347)
96
50
(8)
(42)
149
25
(307)
1
Deferred tax assets and liabilities have been re-analysed during the year to better reflect the net position, and provide further detail. Amounts previously recorded as ‘other’ are now analysed within retirement
benefit assets/(obligations), accounting provisions and accruals and deferred interest. In addition, amounts previously recorded as ‘intangibles’ are now analysed between goodwill and other intangible assets. The
comparative figures for the year ended 31 March 2022 have been re-presented to reflect this change.
Experian plc
Financial statements
216
(iii) Other information on deferred tax assets and liabilities
Judgment is required when assessing the recognition of deferred tax assets. The Group has not recognised deferred tax on losses of US$543m
(2022: US$641m) that could be utilised against future taxable income or on US$224m (2022: US$265m) of capital losses that could be utilised against
future taxable gains. While these losses are available indefinitely, they have arisen in undertakings in which it is not currently anticipated that future
benefit will be available from their use. The capital losses arising on investments are available for use within five years, and future taxable gains against
which the capital losses could be utilised are not currently anticipated.
There are retained earnings of US$9,224m (2022: US$9,699m) in subsidiary undertakings which could be subject to tax if remitted to Experian plc.
No deferred tax liability has been recognised on these earnings because the Group is in a position to control the timing of the reversal of the temporary
difference and it is probable that such differences will not reverse in the foreseeable future. Given the mix of countries and tax rates, it is not practicable
to determine the impact of such remittance.
During the current year the main rate of UK corporation tax was 19% (2022: 19%), and rose to 25% from 1 April 2023. Deferred tax is recognised at the
rate prevailing when temporary differences are expected to reverse.
Notes
2023
US$m
2022
US$m
At 1 April
(72)
(142)
Differences on exchange
(3)
3
Tax charge in the Group income statement – continuing operations
17(a)
(521)
(314)
Tax credit in the Group income statement – discontinued operations
18
—
16
Tax recognised directly in equity on transactions with owners
(5)
(1)
Other tax paid
525
366
Transfers
(9)
—
At 31 March
(85)
(72)
Presented in the Group balance sheet as:
Current tax assets
50
37
Current tax liabilities
(135)
(109)
(85)
(72)
37. Deferred and current tax continued
217
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
2023
2022
North
America
legal
claims
US$m
North
America
security
incident
costs
US$m
Restructuring
US$m
Other
liabilities
US$m
Total
US$m
North
America
legal
claims
US$m
North
America
security
incident
costs
US$m
Other
liabilities
US$m
Total
US$m
At 1 April
2
14
—
21
37
2
8
17
27
Differences on exchange
—
—
—
(1)
(1)
—
—
3
3
Amounts charged in the year
26
—
15
4
45
2
6
5
13
Utilised
(3)
(14)
(2)
(3)
(22)
(2)
—
(4)
(6)
At 31 March
25
—
13
21
59
2
14
21
37
Presented in the Group balance sheet as:
Current provisions
25
—
13
18
56
2
14
17
33
Non-current provisions
—
—
—
3
3
—
—
4
4
25
—
13
21
59
2
14
21
37
A charge for legal costs of US$26m has been recognised in respect of a number of historical legal claims in North America, offset by insurance
recoveries of US$29m.
In September 2015, Experian North America suffered an unauthorised intrusion to its Decision Analytics computing environment that allowed
unauthorised acquisition of certain data belonging to a client, T-Mobile USA, Inc. We notified the individuals who may have been affected and offered free
credit monitoring and identity theft resolution services. In addition, government agencies were notified as required by law. The one remaining claim in
respect of the incident was settled during the year for US$14m.
A charge of US$15m was incurred in the year in connection with restructuring, primarily in the EMEA and Asia Pacific regions (note 15(d)).
Other liabilities principally comprise liabilities of Serasa S.A., in connection with local legal and tax issues, which were primarily recognised on its
At 31 March 2023, there were 971.4m shares in issue (2022: 970.6m). During the year ended 31 March 2023, 0.8m (2022: 1.0m) shares were issued and
none (2022: none) were cancelled. Further information on share capital is contained in note Q to the Company financial statements.
The difference between the amounts shown in the Group and Company financial statements in respect of called-up share capital and the share premium
(a) Retained earnings
Retained earnings comprise net profits retained in the Group after the payment of equity dividends. There are no significant statutory, contractual or
exchange control restrictions on distributions by Group undertakings.
(b) Other reserves
(i) Movements in reserves
Merger
reserve
US$m
Hedging
reserve
US$m
Translation
reserve
US$m
Own shares
reserve
US$m
Total other
reserves
US$m
At 1 April 2022
(15,682)
15
(1,268)
(1,129)
(18,064)
Purchase of shares by employee trusts
—
—
—
(45)
(45)
Purchase of shares held as treasury shares
—
—
—
(149)
(149)
Other vesting of awards and exercises of share options
—
—
—
50
50
Change in the fair value of hedging instruments recognised in OCI
—
(38)
—
—
(38)
Amounts reclassified from OCI to the Group income statement
—
30
—
—
30
Currency translation losses
—
—
(197)
—
(197)
At 31 March 2023
(15,682)
7
(1,465)
(1,273)
(18,413)
Merger
reserve
US$m
Hedging
reserve
US$m
Translation
reserve
US$m
Own shares
reserve
US$m
Total other
reserves
US$m
At 1 April 2021
(15,682)
13
(1,303)
(1,006)
(17,978)
Purchase of shares by employee trusts
—
—
—
(61)
(61)
Purchase of shares held as treasury shares
—
—
—
(111)
(111)
Other vesting of awards and exercises of share options
—
—
—
49
49
Change in the fair value of hedging instruments recognised in OCI
—
(24)
—
—
(24)
Amounts reclassified from OCI to the Group income statement
—
26
—
—
26
Currency translation gains
—
—
35
—
35
At 31 March 2022
(15,682)
15
(1,268)
(1,129)
(18,064)
(ii) Nature of reserves
The merger reserve arose on the demerger from GUS plc in 2006 and is the difference between the share capital and share premium of GUS plc and the
nominal value of the share capital of the Company before a share offer at that date.
Movements on the hedging reserve and the position at the balance sheet date reflect hedging transactions, originating from the management of foreign
exchange risk, which are not charged or credited to the Group income statement, net of related tax.
Movements on the translation reserve and the position at the balance sheet date reflect foreign currency translations since 1 April 2004 which are not
charged or credited to the Group income statement, net of related tax. The movement in the year ended 31 March 2023 comprises currency translation
losses of US$197m (2022: gains of US$35m) recognised directly in Other comprehensive income.
The balance on the own shares reserve is the cost of ordinary shares in the Company and further details are given in note 40(b)(iii). The difference
between the amounts shown in the Group and Company financial statements in respect of this reserve arose due to translation of pound sterling
amounts into US dollars at different exchange rates on different translation dates.
(iii) Movements in own shares held and own shares reserve
Number of own shares held
Cost of own shares held
Treasury
million
Trusts
million
Total
million
Treasury
US$m
Trusts
US$m
Total
US$m
At 1 April 2022
49
8
57
887
242
1,129
Purchase of shares by employee trusts
—
2
2
—
45
45
Purchase of shares held as treasury shares
4
—
4
149
—
149
Other vesting of awards and exercises of share
options
(1)
(3)
(4)
(13)
(37)
(50)
At 31 March 2023
52
7
59
1,023
250
1,273
Number of own shares held
Cost of own shares held
Treasury
million
Trusts
million
Total
million
Treasury
US$m
Trusts
US$m
Total
US$m
At 1 April 2021
52
4
56
871
135
1,006
Purchase of shares by employee trusts
—
2
2
—
61
61
Purchase of shares held as treasury shares
3
—
3
111
—
111
Transfers
(6)
6
—
(87)
87
—
Other vesting of awards and exercises of share
options
—
(4)
(4)
(8)
(41)
(49)
At 31 March 2022
49
8
57
887
242
40. Retained earnings and other reserves continued
219
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
(a) Cash generated from operations
Notes
2023
US$m
2022
US$m
Profit before tax
Share of post-tax loss of associates
Net finance expense/(income)
(59 )
Operating profit
Profit on disposal of property, plant and equipment
(4 )
Net loss on disposal of operations
15(b)
Net profit on disposal of associates
15(c), 24
(1 )
(90 )
Impairment of goodwill
21(a), 21(d)
Impairment of other intangible assets
1
22
Amortisation and depreciation
2
13
Charge in respect of share incentive plans
34(a)
Decrease in working capital
41(b)
Acquisition expenses – difference between income statement charge and amount paid
Adjustment to the fair value of contingent consideration
Movement in Exceptional and other non-benchmark items included in working capital
Movement in Exceptional items included in other intangible assets
Cash generated from operations
1
US$8m of the charge for impairment of internally generated software assets is recorded as exceptional as it relates to restructuring activity.
2
Amortisation and depreciation includes amortisation of acquisition intangibles of US$192m (2022: US$174m) which is excluded from Benchmark PBT.
(b) Decrease in working capital
2023
US$m
2022
US$m
Trade and other receivables
(171 )
(143 )
Trade and other payables
Decrease in working capital
(c) Purchase of other intangible assets
2023
US$m
2022
US$m
Databases
190
180
Internally generated software
335
236
Internal use software
38
29
Purchase of other intangible assets
563
445
(d) Cash flows on acquisitions (non-GAAP measure)
2023
US$m
2022
US$m
Purchase of subsidiaries (note 42(a))
268
706
Less: net cash acquired with subsidiaries (note 42(a))
(5)
(17)
Settlement of deferred and contingent consideration
46
47
As reported in the Group cash flow statement
309
736
Acquisition expenses paid
38
40
Settlement of put options held over shares in subsidiaries
133
4
Transactions in respect of non-controlling interests
—
1
Cash outflow for acquisitions (non-GAAP measure)
480
781
(e) Cash outflow in respect of net share purchases (non-GAAP measure)
2023
US$m
2022
US$m
Issue of ordinary shares
(19)
(24)
Purchase of shares by employee trusts
45
61
Purchase of shares held as treasury shares
149
109
Purchase of shares for Co-investment Plan delivery
—
3
Cash outflow in respect of net share purchases (non-GAAP measure)
175
149
As reported in the Group cash flow statement:
Cash inflow in respect of shares issued
(19)
(24)
Cash outflow in respect of share purchases
194
173
Cash outflow in respect of net share purchases (non-GAAP measure)
175
149
(f) Analysis of cash and cash equivalents
2023
US$m
2022
US$m
Cash and cash equivalents in the Group balance sheet
202
179
Bank overdrafts
(4)
(3)
Cash and cash equivalents in the Group cash flow statement
198
176
(g) Reconciliation of Cash generated from operations to Benchmark operating cash flow (non-GAAP measure)
Notes
2023
US$m
2022
US$m
Cash generated from operations
41(a)
2,358
2,270
Purchase of other intangible assets
41(c)
(563)
(445)
Purchase of property, plant and equipment
(64)
(63)
Sale of property, plant and equipment
—
23
Principal lease payments
(57)
(57)
Acquisition expenses paid
38
40
Dividends received from associates
2
13
Cash flows in respect of Exceptional and other non-benchmark items
39
19
Benchmark operating cash flow (non-GAAP measure)
1,753
1,800
Cash flow conversion for the year ended 31 March 2023 was 98% (2022: 109%). Benchmark free cash flow for the year ended 31 March 2023, as set out
41. Notes to the Group cash flow statement continued
221
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
(a) Acquisitions in the year
The Group made six acquisitions during the year ended 31 March 2023, including the acquisition on 4 April 2022 of the entire share capital of CIC Plus,
LLC and its affiliate Tayvah, LLC (together CIC Plus), a leading provider of employer compliance management solutions, for a cash consideration of
US$188m. Goodwill of US$108m was recognised based on the fair value of the net assets acquired of US$80m. This investment supplements our
employer services offering in the USA.
We also purchased the remaining 40% interest in the Arvato Financial Solutions Risk Management Division, acquired in FY21, for US$133m (note 41(d)).
CIC Plus
US$m
Other
US$m
Total
US$m
Intangible assets:
Customer and other relationships
51
19
70
Software development
20
35
55
Marketing-related acquisition intangibles
1
—
1
Other non-acquisition intangibles
4
—
4
Intangible assets
76
54
130
Property, plant and equipment
—
1
1
Trade and other receivables
9
4
13
Cash and cash equivalents (note 41(d))
3
2
5
Trade and other payables
(8)
(3)
(11)
Deferred tax liabilities
—
(4)
(4)
Total identifiable net assets
80
54
134
Goodwill
108
72
180
Total
188
126
314
Satisfied by:
Cash and cash equivalents (note 41(d))
188
80
268
Put options
—
11
11
Contingent consideration
—
35
35
Total
188
126
314
These fair values are determined by using established estimation techniques including discounted cash flow and option valuation models, such as the
multi-period excess earnings method for customer and other relationships and the relief-from-royalty method for software development. The most
significant assumption is related to the proportion of earnings attributable to customer and other relationships and software development. For
significant acquisitions, we engage with third-party valuation experts to assist with this process.
Fair values on the acquisition of CIC Plus have been finalised, other amounts are provisional and will be finalised no later than one year after the date of
acquisition. Provisional amounts; predominantly for intangible assets, have been included at 31 March 2023, as a consequence of the timing and
complexity of the acquisitions.
Goodwill represents the synergies, assembled workforces and future growth potential of the acquired businesses. The goodwill in relation to CIC Plus
and one other acquisition is currently deductible for tax purposes, and consequently no deferred tax liability has been recognised for these acquisitions.
There have been no other material gains, losses, corrections or other adjustments recognised in the year ended 31 March 2023 that relate to acquisitions
in the current or earlier years.
(b) Additional information
(i) Current year acquisitions
CIC Plus
US$m
Other
US$m
Total
US$m
Increase/(decrease) in book value of net assets from provisional fair value adjustments:
Intangible assets
76
54
130
Trade and other payables
(3)
(1)
(4)
Deferred tax liabilities
—
(4)
(4)
Increase in book value of net assets from provisional fair value adjustments
73
49
122
Gross contractual amounts receivable in respect of trade and other receivables
9
4
13
Pro-forma revenue from 1 April 2022 to date of acquisition
—
6
6
Revenue from date of acquisition to 31 March 2023
32
5
37
Profit before tax from date of acquisition to 31 March 2023
2
1
3
At the dates of acquisition, the gross contractual amounts receivable in respect of trade and other receivables of US$13m were expected to be collected
in full.
If the transactions had occurred on the first day of the financial year, the estimated additional contribution to profit before tax would have been US$1m.
(ii) Prior years’ acquisitions
US$39m of contingent consideration was settled in the year in respect of acquisitions made in FY22. These cash flows principally relate to the
acquisitions of Tax Credit Co, LLC (TCC) and Gabi Personal Insurance Agency, Inc. (Gabi). In addition, deferred consideration of US$4m was settled in
the year in respect of the FY22 acquisition of Employment Tax Servicing, LLC. In the year ended 31 March 2022, US$43m was settled in respect of
acquisitions made in earlier years, principally in relation to the FY21 and FY20 acquisitions of Axesor businesses and Look Who’s Charging Pty Ltd.
The Group made six acquisitions in the year ended 31 March 2022, which included Gabi and TCC, both in the USA. A cash outflow of US$689m was
reported in the Group cash flow statement for that year, after deduction of US$17m in respect of net cash acquired.
(iii) Post balance sheet acquisitions
On 20 April 2023, we agreed to acquire Flexpag Tecnologia e Instituição de Pagamento S.A. (Flexpag) for R$250m (c.US$49m), and contingent
consideration based on Flexpag’s profits in calendar year 2025, the fair value of which is yet to be determined. Completion is expected in the year ending
31 March 2024. Flexpag is a Brazilian FinTech specialising in digital payment solutions, connecting payment systems to utilities to offer consumers a
broad range of payment methods.
The fair values of goodwill, software development, customer relationships and other assets and liabilities in respect of these acquisitions will be reported
During the year we classified two small subsidiaries in the EMEA region, and one subsidiary in the Asia Pacific region as held-for-sale. In the year ended
31 March 2022 the Group recorded a UK associate as held-for-sale. It is not now anticipated that the UK transaction will complete within 12 months and
accordingly the investment has been reclassified as an associate at 31 March 2023.
The Group continues to market part of its UK property portfolio and it is anticipated that this transaction will be completed in the year ending 31 March
2024. Any gain or loss on disposal will be recognised in that year.
2023
US$m
2022
US$m
Assets classified as held-for-sale:
Investment in associate (note 24)
—
29
Property, plant and equipment
12
12
Trade and other receivables
4
—
Assets classified as held-for-sale
16
41
Liabilities classified as held-for-sale:
Trade and other payables
(3)
—
Liabilities classified as held-for-sale
(3)
42. Acquisitions continued
223
Experian plc
Annual Report 2023
Financial statements
Notes to the Group financial statements
continued
During the year we disposed of interests in two small subsidiary undertakings in EMEA/Asia Pacific, realising a gain on disposal of US$2m. In addition,
2023
US$m
2022
US$m
Capital expenditure for which contracts have been placed:
Other intangible assets
56
64
Property, plant and equipment
12
17
68
81
Capital commitments at 31 March 2023 included US$3m (2022: US$2m) in respect of right-of-use assets. Capital commitments at 31 March 2023
included commitments of US$46m not expected to be incurred before 31 March 2024. Capital commitments at 31 March 2022 included commitments of
US$56m not then expected to be incurred before 31 March 2023.
(a) Latin America tax
As previously indicated, Serasa S.A. has been advised that the Brazilian tax authorities are challenging the deduction for tax purposes of goodwill
amortisation arising from its acquisition by Experian in 2007. The Brazilian courts have ultimately upheld Experian’s position in respect of the tax years
from 2007 to 2012 with no further right of appeal. The Brazilian tax authorities have raised similar assessments in respect of the 2013 to 2018 tax years,
in which approximately US$198m was claimed by Experian, and may raise similar claims in respect of other years. The possibility of this resulting in a
liability to the Group is considered to be remote, based on the advice of external legal counsel, success in cases to date and other factors in respect of the
claim.
A similar challenge has been raised in Colombia in respect of the 2014 and 2016 tax years, in which approximately US$4m was claimed, and similar
claims in respect of other years may be raised. We are contesting these on the basis of external legal advice.
(b) UK marketing services regulation
We successfully appealed to the First Tier Tribunal a final enforcement notice from the UK Information Commissioner’s Office (ICO) with respect to a
2018 audit of several companies on the use of data for marketing purposes under the EU General Data Protection Regulation (GDPR), which relates to
our marketing services activities in the UK. The ICO has subsequently applied for permission to appeal to the Upper Tier Tribunal, during which time all
requirements will be stayed. At this stage we do not know what the final outcome will be, but if the First Tier Tribunal judgment is overturned, it may
require significant changes to business processes in our UK marketing services business. This business represents approximately 1% of our global
revenues and we do not expect this to result in a materially adverse financial outcome for the Group.
(c) Other litigation and claims
There continue to be an increasing number of pending and threatened claims and regulatory actions involving the Group across all its major geographies
which are in various stages of investigation or enforcement, and which are being vigorously defended, including from the CFPB and FTC in the USA. The
directors do not believe that the outcome of any individual enforcement notice will have a materially adverse effect on the Group’s financial position.
However, as is inherent in legal, regulatory and administrative proceedings, there is a risk of outcomes that may be unfavourable to the Group. In the
Experian plc
Financial statements
224
(a) Related undertakings
A full list of the Company’s related undertakings, including subsidiary and associate undertakings, is given in note T to the Company financial statements.
Following the divestment of CCM in the year ended 31 March 2018, the Group owns 23.0% of the issued share capital of Vector CM Holdings (Cayman),
L.P. (Vector). Vector completed a merger with the CM Group involving its Cheetah Digital business on 4 February 2022. The Group no longer has
significant influence over Vector and accordingly our interest in this company was recognised as a trade investment from that date. In the year ended
31 March 2022, a promissory note and associated interest due to Experian of US$110m were repaid in full as a result of the merger. Interest income of
US$8m was recognised on the promissory note in that year.
Transactions with associates are made on normal market terms and in the year ended 31 March 2023 comprised the provision and receipt of services to
other associates of US$nil (2022: US$10m) and US$7m (2022: US$7m) respectively. At 31 March 2023 and 31 March 2022, no amounts were owed from
or to associates.
(c) Transactions with other related undertakings
The Group transacts with a number of related undertakings in connection with the operation of its share incentive plans, pension arrangements in the
UK, the USA, Brazil, South Africa, Germany and Ireland, and the provision of medical cover in the UK. These undertakings are listed in note T(v) to the
Company financial statements. Transactional relationships can be summarised as follows:
a
The assets, liabilities and expenses of the Experian UK Approved All-Employee Share Plan and The Experian plc Employee Share Trust are included in
these financial statements.
a
During the year ended 31 March 2023, US$33m (2022: US$56m) was paid by the Group to related undertakings, in connection with the provision of
post-employment pensions benefits. US$3m (2022: US$3m) was paid to Experian Medical Plan Limited, in connection with the provision of healthcare
benefits.
a
2023
US$m
2022
US$m
Salaries and short-term employee benefits
9
12
Share incentive plans
13
17
22
29
Key management personnel comprises the Company’s executive and non-executive directors and further details of their remuneration are given in the
audited parts of the Report on directors’ remuneration. There were no other material transactions with the Group in which the key management
Details of the second interim dividend announced since the end of the reporting period are given in note 20.
225
Experian plc
Annual Report 2023
Financial statements
Company statement of comprehensive income
Notes
2023
US$m
2022
US$m
Other operating income
F
130.9
116.9
Staff costs
G
(3.9)
(4.3)
Depreciation
M
(0.7)
(0.3)
Other operating charges
F
(139.8)
(128.2)
Operating loss
(13.5)
(15.9)
Dividend income from subsidiary undertakings
H
975.0
250.0
Interest receivable and similar income
I
—
69.5
Impairment of investment in subsidiary undertaking
N
(79.0)
—
Interest payable and similar expenses
J
(2.0)
(0.2)
Profit before tax
880.5
303.4
Tax on profit
K
3.1
(13.0)
Profit after tax and for the financial year
883.6
290.4
The Company has no recognised items of income and expenditure other than those included in the profit and loss account. Total comprehensive income
for the financial year is therefore equal to the profit for the financial year.
for the year ended 31 March 2023
for the year ended 31 March 2023
Company balance sheet
Notes
2023
US$m
2022
US$m
Fixed assets
Tangible assets
M(i)
5.7
2.4
Investments – shares in Group undertakings
N
20,609.6
19,978.5
Deferred tax assets
K
2.8
2.6
20,618.1
19,983.5
Current assets
Debtors – amounts falling due within one year
O
120.9
2.5
Cash at bank and in hand
0.4
0.4
Current liabilities
Creditors – amounts falling due within one year
P
(2.6)
(35.3)
Net current assets/(liabilities)
118.7
(32.4)
Total assets less current liabilities
20,736.8
19,951.1
Creditors – amounts falling due after more than one year
P
(3.8)
(2.5)
Net assets
20,733.0
19,948.6
Equity
Called-up share capital
Q
73.2
73.1
Share premium account
Q
1,469.1
1,449.9
Profit and loss account reserve
R
19,190.7
18,425.6
Total shareholders' funds
20,733.0
19,948.6
These financial statements were approved by the Board on 16 May 2023 and were signed on its behalf by:
Craig Boundy
Director
at 31 March 2023
Company statement of changes in equity
Called-up
share
capital
(Note Q)
US$m
Share
premium
account
(Note Q)
US$m
Profit and loss account reserve
Total
equity
US$m
Profit and
loss account
US$m
Own shares
reserve
US$m
Total
(Note R)
US$m
At 1 April 2022
73.1
1,449.9
19,522.9
(1,097.3)
18,425.6
19,948.6
Profit and Total comprehensive income for the financial year
—
—
883.6
—
883.6
883.6
Transactions with owners:
Employee share incentive plans:
– value of employee services
—
—
128.6
—
128.6
128.6
– shares issued on vesting
0.1
19.2
—
—
—
19.3
– purchase of shares by employee trusts
—
—
—
(44.7)
(44.7)
(44.7)
– other vesting of awards and exercises of share options
—
—
(50.2)
50.2
—
—
Purchase of shares held as treasury shares
—
—
—
(149.4)
(149.4)
(149.4)
Dividends paid
—
—
(53.0)
—
(53.0)
(53.0)
Transactions with owners
0.1
19.2
25.4
(143.9)
(118.5)
(99.2)
At 31 March 2023
73.2
1,469.1
20,431.9
(1,241.2)
19,190.7
20,733.0
Called-up
share
capital
(Note Q)
US$m
Share
premium
account
(Note Q)
US$m
Profit and loss account reserve
Total
equity
US$m
Profit and
loss account
US$m
Own shares
reserve
US$m
Total
(Note R)
US$m
At 1 April 2021
73.0
1,425.7
19,171.0
(974.3)
18,196.7
19,695.4
Profit and Total comprehensive income for the financial year
—
—
290.4
—
290.4
290.4
Transactions with owners:
Employee share incentive plans:
– value of employee services
—
—
149.0
—
149.0
149.0
– shares issued on vesting
0.1
24.2
—
—
—
24.3
– purchase of shares by employee trusts
—
—
—
(61.3)
(61.3)
(61.3)
– other vesting of awards and exercises of share options
—
—
(52.3)
49.2
(3.1)
(3.1)
Purchase of shares held as treasury shares
—
—
—
(110.9)
(110.9)
(110.9)
Dividends paid
—
—
(35.2)
—
(35.2)
(35.2)
Transactions with owners
0.1
24.2
61.5
(123.0)
(61.5)
(37.2)
At 31 March 2022
73.1
1,449.9
19,522.9
(1,097.3)
18,425.6
19,948.6
for the year ended 31 March 2023
A. Corporate information
Corporate information for Experian plc (the Company) is set out in note 1
to the Group financial statements, with further information given in the
Strategic report and the Corporate governance report.
B. Basis of preparation
The separate financial statements of the Company are:
a
prepared on the going concern basis, under the historical cost
convention, and in accordance with UK accounting standards;
a
presented in US dollars, the Company’s functional currency; and
a
designed to include disclosures in line with those required by those
parts of the UK Companies Act 2006 applicable to companies reporting
under UK accounting standards even though the Company is
incorporated and registered in Jersey.
The directors opted to prepare the financial statements for the year ended
31 March 2023 in accordance with FRS 101 ‘Reduced Disclosure
Framework’. The Company intends to continue to use this accounting
framework until further notice.
Going concern
The directors continue to adopt the going concern basis of accounting
in preparing the financial statements. Details of the going concern
assessment for the Group and the Company are provided in note 2 to the
Group financial statements.
C. FRS 101 exemptions
FRS 101 allows certain exemptions from the requirements of IFRS to
avoid the duplication of information provided in the Group financial
statements and to provide more concise financial reporting in entity
financial statements. The following exemptions have therefore been
applied in the preparation of these financial statements:
a
Paragraphs 45(b) and 46 to 52 of IFRS 2 ‘Share-based Payment’,
exempting the Company from providing details of share options and
of how the fair value of services received was determined.
a
IFRS 7 ‘Financial Instruments: Disclosures’.
a
Paragraphs 91 to 99 of IFRS 13 ‘Fair Value Measurement’, exempting
the Company from disclosing valuation techniques and inputs used for
the measurement of assets and liabilities.
a
Paragraph 38 of IAS 1 ‘Presentation of Financial Statements’,
exempting the Company from disclosing comparative information
required by:
–
paragraph 79(a)(iv) of IAS 1 – shares outstanding at the beginning
and at the end of the period; and
–
paragraph 73(e) of IAS 16 ‘Property, Plant and Equipment’ –
reconciliations between the carrying amount at the beginning
and end of the period.
a
The following paragraphs of IAS 1:
–
paragraphs 10(d) and 111, exempting the Company from providing
a cash flow statement and information;
–
paragraph 16, exempting the Company from providing a statement
of compliance with all IFRS;
–
paragraph 38A, exempting the Company from the requirement for
a minimum of two of each primary statement and the related notes;
–
paragraphs 38B to D, exempting the Company from the requirement
to provide additional comparative information; and
–
paragraphs 134 to 136, exempting the Company from presenting
capital management disclosures.
a
IAS 7 ‘Statement of Cash Flows’.
a
Paragraphs 30 and 31 of IAS 8 ‘Accounting Policies, Changes in
Accounting Estimates and Errors’, exempting the Company from
disclosing information where it has not applied a new IFRS which has
been issued but is not yet effective.
a
Paragraph 17 of IAS 24 ‘Related Party Disclosures’, exempting the
Company from disclosing details of key management compensation.
a
The requirements in IAS 24 to disclose related party transactions with
wholly-owned members of the Group.
The use of critical accounting estimates and management judgment is
required in applying the accounting policies. Areas involving a higher
degree of judgment or complexity, or where assumptions and estimates
are significant to the Company financial statements, are highlighted in
note E.
D. Significant accounting policies
The significant accounting policies applied are summarised below. They
have been consistently applied to both years presented. The explanations
of these policies focus on areas where judgment is applied or which are
particularly important in the financial statements.
There are no new standards, amendments to existing standards or
interpretations that are effective for the year ended 31 March 2023 that
have had a material impact on the Company’s financial statements.
Content from accounting standards, amendments and interpretations is
excluded where there is simply no policy choice under UK accounting
standards.
(i) Foreign currency
Transactions in foreign currencies are recorded at the exchange rate
prevailing at the transaction date. Monetary assets and liabilities
denominated in foreign currencies are retranslated at the exchange rate
prevailing at the balance sheet date. All differences are taken to the profit
and loss account in the year in which they arise.
(ii) Investments – shares in Group undertakings
Investments in Group undertakings are stated at cost less any provisions
for impairment. The fair value of share incentives issued by the Company
to employees of Group undertakings is accounted for as a capital
contribution and recognised as an increase in the Company’s investment
in Group undertakings, with a corresponding increase in equity.
(iii) Debtors and creditors
Debtors are initially recognised at fair value and subsequently measured
at this value. Where the time value of money is material, they are then
carried at amortised cost using the effective interest method. Creditors
are initially recognised at fair value. Where the time value of money is
material, they are then carried at amortised cost using the effective
interest method.
(iv) Cash at bank and in hand
Cash at bank includes deposits held at call with banks and other
short-term highly liquid investments.
(v) Accounting for derivative financial instruments
The Company uses forward foreign exchange contracts to manage its
exposures to fluctuations in foreign exchange rates. The interest
differential reflected in forward foreign exchange contracts is taken to
interest receivable and similar income or interest payable and similar
expenses. Forward foreign exchange contracts are recognised at fair
value, based on forward foreign exchange market rates at the balance
sheet date. Gains or losses on forward foreign exchange contracts are
taken to the profit and loss account in the year in which they arise.
(vi) Leases
The Company undertakes an assessment of whether a contract is or
contains a lease at its inception. The assessment establishes whether the
Company obtains substantially all the economic benefits from the use of
an asset and whether it has the right to direct its use.
Low-value lease payments are recognised as an expense, on a
straight-line basis over the lease term. For other leases the Company
recognises both a right-of-use asset and a lease liability at the
commencement date of a lease contract.
The right-of-use asset is initially measured at cost, comprising the initial
amount of the lease liability adjusted for payments made at or before the
commencement date, plus initial direct costs and an estimate of the cost
of any obligation to refurbish the asset or site, less lease incentives.
Subsequently, right-of-use assets are measured at cost less accumulated
depreciation and impairment losses and are adjusted for any
remeasurement of the lease liability. Depreciation is calculated on a
straight-line basis over the shorter of the estimated useful life of the
right-of-use asset and the period of the lease.
The lease term comprises the non-cancellable period of a lease, plus
periods covered by an extension option, if it is reasonably certain to be
exercised, and periods covered by a termination option if it is reasonably
certain not to be exercised.
The lease liability is initially measured at the present value of lease
payments that are outstanding at the commencement date, discounted at
the interest rate implicit in the lease or if that rate cannot be easily
determined the Company’s incremental borrowing rate. Lease payments
comprise payments of fixed principal less any lease incentives.
The lease liability is remeasured when there is a change in future lease
payments arising from a change in an index or rate, or if the Company
changes its assessment of whether it will exercise an extension or
termination option.
When a lease liability is remeasured, a corresponding adjustment is made
to the carrying amount of the right-of-use asset or is recognised in the
Company profit and loss account if the asset is fully depreciated.
(vii) Tax
Current tax is calculated on the basis of the tax laws enacted or
substantively enacted at the balance sheet date in Ireland, where the
Company is resident.
Deferred tax is provided in respect of temporary differences that have
originated but not reversed at the balance sheet date and is determined
using the tax rates that are expected to apply when the temporary
differences reverse. Deferred tax assets are recognised only to the extent
that they are expected to be recoverable.
(viii) Own shares
The Group has a number of equity-settled, share-based employee
incentive plans. In connection with these, shares in the Company are held
by The Experian plc Employee Share Trust and the Experian UK Approved
All-Employee Share Plan. The assets, liabilities and expenses of these
separately administered trusts are included in the financial statements as
if they were the Company’s own. The trusts’ assets mainly comprise
Experian shares, which are shown as a deduction from total shareholders’
funds at cost.
Experian shares purchased and held as treasury shares, in connection
with the above plans and any share purchase programme, are also shown
as a deduction from total shareholders’ funds at cost. The par value of
shares that are purchased and cancelled, in connection with any share
purchase programme, is accounted for as a reduction in called-up share
capital with any cost in excess of that amount being deducted from the
profit and loss account. The Company is not required to recognise the par
value of cancelled shares in a capital redemption reserve.
Contractual obligations to purchase own shares are recognised at the net
present value of expected future payments. Gains and losses in
connection with such obligations are recognised in the profit and loss
account. Gains and losses which arise on financial instruments created by
advance instructions to trade in own shares are recognised directly in
equity.
(ix) Profit and loss account format
Income and expenses, which are recognised on an accruals basis, are
reported by nature in the profit and loss account, as this reflects the
composition of the Company’s income and cost base.
(x) Dividend income
Dividend income is recognised in the Company profit and loss account on
the date on which the Company’s right to receive payment is established.
Liquidation dividends are treated as a return of capital to the extent they
are used to recover the carrying value of the investment in the liquidated
entity. Any amount received in excess of the investment value is treated as
income in the Company profit and loss account.
E. Critical accounting estimates, assumptions and judgments
(i) Critical accounting estimates and assumptions
In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amount of income, costs
and charges, assets and liabilities and the disclosure of contingent liabilities. The resulting accounting estimates, which are based on management’s best
judgment at the date of the financial statements will, by definition, seldom equal the related actual results.
There are no estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year.
(ii) Critical judgments
In applying the Company’s accounting policies, management may make judgments that have a significant effect on the amounts recognised in the
Company financial statements. These judgments may include the classification of transactions between the Company profit and loss account and the
Company balance sheet.
The most significant of these judgments for the Company is in respect of contingencies where, in the case of pending and threatened litigation claims,
management has formed a judgment as to the likelihood of ultimate liability. No liability has been recognised where the likelihood of any loss arising is
possible rather than probable.
F. Other operating income and charges
Other operating income and expenses principally comprise charges to and from other Group undertakings in respect of Group management services
and guarantees provided during the year. The increase in other operating income and charges in the year ended 31 March 2023 compared to the prior
year is due to underlying growth of the business and an increase in the overall cost of providing management services. Other operating charges include
a fee of US$0.1m (2022: US$0.1m) payable to the Company’s auditor and its associates for the audit of the Company financial statements.
G. Staff costs
2023
US$m
2022
US$m
Directors' fees
2.4
2.7
Wages and salaries
1.3
1.3
Social security costs
0.1
0.1
Other pension costs
0.1
0.2
3.9
4.3
Executive directors of the Company are employed by other Group undertakings and details of their remuneration, together with that of the non-executive
directors, are given in the audited part of the Report on directors’ remuneration. The Company had three employees in the current and prior year.
H. Dividend income from subsidiary undertakings
During the year subsidiary undertakings paid dividends of US$975m (2022: US$250m) to the Company, in connection with group restructuring.
I. Interest receivable and similar income
2023
US$m
2022
US$m
Interest receivable on amounts owed by subsidiary undertakings
—
67.2
Foreign exchange gains
—
2.3
—
69.5
J. Interest payable and similar expenses
2023
US$m
2022
US$m
Interest payable on lease obligation
0.4
0.2
Interest payable on amounts owed to subsidiary undertakings
1.5
—
Foreign exchange losses
0.1
—
2.0
0.2
K. Tax on profit
(i) Analysis of tax (credit)/charge in the profit and loss account
2023
US$m
2022
US$m
Current tax:
Irish corporation tax credit on profit for the financial year
(2.9)
—
Deferred tax:
Origination and reversal of timing differences
—
13.1
Adjustment in respect of prior years
(0.2)
(0.1)
Total deferred tax (credit)/charge for the financial year
(0.2)
13.0
Tax (credit)/charge for the year
(3.1)
13.0
(ii) Factors affecting the tax (credit)/charge for the financial year
The tax (credit)/charge for the year is at a rate lower (2022: lower) than the main rate of Irish corporation tax of 25% (2022: 25%) with the differences
explained below.
2023
US$m
2022
US$m
Profit before tax
880.5
303.4
Profit before tax multiplied by the applicable rate of tax
220.1
75.9
Effects of:
Income not taxable
(245.7)
(63.6)
Expenses not deductible
20.4
0.8
Adjustment in respect of prior years
(0.2)
(0.1)
Losses recognised at a lower rate of tax (12.5%)
2.3
—
Tax (credit)/charge for the year
(3.1)
13.0
The Company’s tax charge will continue to be influenced by the nature of its income and expenditure and prevailing Irish and Jersey tax laws.
(iii) Deferred tax asset
The deferred tax asset is in respect of tax losses and the movements thereon are as follows:
2023
US$m
2022
US$m
At 1 April
2.6
15.6
Tax credit/(charge) in the profit and loss account
0.2
(13.0)
At 31 March
2.8
2.6
The Company has no unrecognised deferred tax (2022: US$nil).
L. Dividends
Total gross dividends of US$482.4m (2022: US$443.6m) were paid to Experian shareholders during the year. The Company paid interim dividends of
US$53.0m (2022: US$35.2m) to those shareholders who did not elect to receive dividends under the Income Access Share arrangements. The balance
of US$429.4m (2022: US$408.4m) was paid by a subsidiary undertaking, Experian (UK) Finance Limited (EUKFL), under the Income Access Share
arrangements. The Company’s profit and loss account reserve is available for distribution by way of dividend. At 31 March 2023, the distributable
reserves of EUKFL as determined under UK company law were US$8,574.2m (2022: US$10,345.2m).
Since the balance sheet date, the directors have announced a second interim dividend of 37.75 US cents per ordinary share for the year ended 31 March
2023. No part of this dividend is included as a liability in these financial statements. Further details of payment arrangements, including the Income
Access Share arrangements, are given in the Shareholder and corporate information section of the Annual Report.
M. Leases
The Company leases its offices and relocated during the year. The lease term is ten years and payments are reset periodically to reflect market rental
rates.
(i) Tangible assets
2023
2022
Leasehold
improvements
US$m
Right-of-use
assets
Buildings
US$m
Total
US$m
Right-of-use
assets
Buildings
US$m
Cost
At 1 April
—
3.2
3.2
3.2
Additions
2.2
3.9
6.1
—
Disposal
—
(3.1)
(3.1)
—
At 31 March
2.2
4.0
6.2
3.2
Accumulated depreciation
At 1 April
—
0.8
0.8
0.5
Charge for the year
0.1
0.6
0.7
0.3
Disposal
—
(1.0)
(1.0)
—
At 31 March
0.1
0.4
0.5
0.8
Net book amount at 31 March
2.1
3.6
5.7
2.4
(ii) Lease obligation:
2023
US$m
2022
US$m
Current
0.5
0.2
Non-current
3.8
2.5
At 31 March
4.3
2.7
(iii) Maturity of lease obligation – contractual undiscounted cash flows
2023
US$m
2022
US$m
Less than one year
0.6
0.3
One to two years
0.6
0.3
Two to three years
0.6
0.3
Three to four years
0.6
0.3
Four to five years
0.6
0.3
Over five years
2.0
1.8
Total undiscounted lease obligation at 31 March
5.0
3.3
(iv) Amounts recognised in the Company profit and loss account
2023
US$m
2022
US$m
Depreciation charge for right-of-use assets
0.6
0.3
Interest expense
0.4
0.2
1.0
0.5
(v) Lease cash flow
Lease payments in the year ended 31 March 2023 were US$0.3m (2022: US$0.5m), of which US$0.1m (2022: US$0.2m) related to payments of interest
and US$0.2m (2022: US$0.3m) was for repayments of principal.
N. Investments – shares in Group undertakings
2023
US$m
2022
US$m
Cost
At 1 April
19,978.5
17,919.5
Additions – fair value of share incentives issued to Group employees
128.6
149.0
Additional investment in direct subsidiary undertakings
581.5
1,910.0
At 31 March
20,688.6
19,978.5
Accumulated impairment
At 1 April
—
—
Charge for the year
79.0
—
At 31 March
79.0
—
Net book amount at 31 March
20,609.6
19,978.5
During the year ended 31 March 2023 Experian plc undertook a number of transactions as a result of group restructuring, including the subscription for
additional shares in existing subsidiary undertakings of US$581.5m (2022: US$1,910.0m).
Following a return of capital in the year via a dividend payment by Experian Ireland Investments Limited and the consequent reduction in its net assets,
the Company performed an impairment review. As Experian Ireland Investments Limited no longer has any underlying activity to generate future cash
flows an impairment charge of US$79.0m (2022: US$nil) was recognised in respect of the Company’s investment in that entity.
A list of the Company’s subsidiary undertakings is given in note T(i). The Company directly holds interests in the whole of the issued share capital of the
following undertakings:
Company
Country of incorporation
Experian Group Services Limited
Ireland
Experian Holdings Ireland Limited
Ireland
Experian Ireland Investments Limited
Ireland
O. Debtors – amounts falling due within one year
2023
US$m
2022
US$m
Amounts owed by Group undertakings
117.4
—
Other debtors
0.6
2.5
Corporation tax asset
2.9
—
120.9
2.5
Amounts owed by Group undertakings are primarily unsecured, interest bearing and repayable on demand.
P. Creditors
Due within
one year
2023
US$m
Due after more
than one year
2023
US$m
Due within
one year
2022
US$m
Due after more
than one year
2022
US$m
Amounts owed to Group undertakings
—
—
34.6
—
Lease obligation (note M)
0.5
3.8
0.2
2.5
Accruals
2.1
—
0.5
—
2.6
3.8
35.3
2.5
Amounts owed to Group undertakings are primarily unsecured, interest free and repayable on demand.
Q. Called-up share capital and share premium account
Allotted and fully paid
2023
US$m
2022
US$m
971,375,480 (2022: 970,613,810) ordinary shares of 10 US cents
73.2
73.1
20 (2022: 20) deferred shares of 10 US cents
—
—
73.2
73.1
At 31 March 2023 and 31 March 2022, the authorised share capital of the Company was US$200m, divided into 1,999,999,980 ordinary shares and 20
deferred shares, each of 10 US cents. The ordinary shares carry the rights to (i) dividend, (ii) to attend or vote at general meetings and (iii) to participate
in the assets of the Company beyond repayment of the amounts paid up or credited as paid up on them. The deferred shares carry no such rights.
During the year ended 31 March 2023, the Company issued 761,670 (2022: 1,002,194) ordinary shares for a consideration of US$19.3m (2022: US$24.3m)
in connection with the Group’s share incentive arrangements, details of which are given in note 34 to the Group financial statements. The difference between
the consideration and the par value of the shares issued is recorded in the share premium account.
During the year the Company purchased 4,754,551 (2022: 2,705,315) of its own shares for a consideration of US$149.4m (2022: US$108.5m), retaining
them as treasury shares.
R. Profit and loss account reserve
The profit and loss account reserve is stated after deducting the balance on the own shares reserve from that on the profit and loss account. The balance
on the profit and loss account comprises net profits retained in the Company after the payment of equity dividends. The balance on the own shares
reserve is the cost of ordinary shares in the Company and further details are given below.
Number of shares held
Cost of shares held
Treasury
million
Trusts
million
Total
million
Treasury
US$m
Trusts
US$m
Total
US$m
At 1 April 2022
48.5
8.2
56.7
885.1
212.2
1,097.3
Purchase of shares by employee trusts
—
1.5
1.5
—
44.7
44.7
Purchase of shares held as treasury shares
4.8
—
4.8
149.4
—
149.4
Other vesting of awards and exercises of share
options
(1.0)
(3.0)
(4.0)
(13.7)
(36.5)
(50.2)
At 31 March 2023
52.3
6.7
59.0
1,020.8
220.4
1,241.2
Number of shares held
Cost of shares held
Treasury
million
Trusts
million
Total
million
Treasury
US$m
Trusts
US$m
Total
US$m
At 1 April 2021
52.3
3.7
56.0
869.1
105.2
974.3
Purchase of shares by employee trusts
—
1.7
1.7
—
61.3
61.3
Purchase of shares held as treasury shares
2.7
—
2.7
110.9
—
110.9
Transfers
(6.0)
6.0
—
(87.0)
87.0
—
Other vesting of awards and exercises of share
options
(0.5)
(3.2)
(3.7)
(7.9)
(41.3)
(49.2)
At 31 March 2022
48.5
8.2
56.7
885.1
212.2
1,097.3
The Company has guaranteed:
a
borrowings of Group undertakings of US$3,753m (2022: US$3,912m);
a
the liabilities of The Experian plc Employee Share Trust and the Experian UK Approved All-Employee Share Plan; and
a
the retirement benefit obligations of Group undertakings that participate in the Experian Pension Scheme and of a Group undertaking that participates
in a small UK defined benefit pension plan (note 36(a)(i)).
(i) Subsidiary undertakings
Company
Country of incorporation
Experian Strategic Solutions SA
Argentina
Experian Asia Pacific Pty Ltd
Australia
Experian Australia Credit Services Pty Ltd
Australia
Experian Australia Fraud Services Pty Ltd
Australia
Experian Australia Holdings Pty Ltd
Australia
Experian Australia Pty Ltd
Australia
Look Who’s Charging Pty Ltd
Australia
Tallyman Australia Pty Limited
Australia
Credify Informationsdienstleistungen GmbH
Austria
1
Experian Austria GmbH
Austria
2
Experian Österreich Verwaltungsgesellschaft mbH
Austria
2
Experian Botswana (Pty) Ltd
Botswana
Brain Soluções de Tecnologia Digital Ltda
Brazil
1
Financeira Veloz Holding Financeira S.A
Brazil
2
Holding Veloz Investimentos e Participações S.A
Brazil
3
Pagueveloz Instituição de Pagamento Ltda.
Brazil
4
Serasa S.A.
Brazil
5
Experian Bulgaria EAD
Bulgaria
Experian Canada Inc.
Canada
Experian Holdings Chile SpA
Chile
1
Experian Services Chile S.A.
Chile
2
Servicios de Información Avanzada Comercial Y Financiera
S.A.
Chile
3
Beijing Yiboruizhi Technology Co., Ltd
China
1
Experian Credit Service (Beijing) Company Limited
China
2
Experian Hong Kong Holdings Limited
China
3
Experian Hong Kong Limited
China
3
Experian Information Technology (Beijing) Company Limited
China
4
Experian Colombia S.A.
Colombia
Experian Services Costa Rica, S.A.
Costa Rica
Experian A/S
Denmark
Accolade Unlimited
England and Wales
Castlight Limited*
England and Wales
CCN UK 2005 Limited
England and Wales
CCN UK Unlimited
England and Wales
Chatsworth Investments Limited
England and Wales
CSID International Limited*
England and Wales
EHI 2005 Limited
England and Wales
EHI UK Unlimited
England and Wales
EIS 2005 Limited
England and Wales
EIS UK Unlimited
England and Wales
Experian (UK) Finance Limited
England and Wales
Experian (UK) Holdings 2006 Limited
England and Wales
Experian 2001 Unlimited
England and Wales
Experian 2006 Unlimited
England and Wales
Experian CIS Limited
England and Wales
Experian Colombia Investments Limited
England and Wales
Experian Europe and Middle East Limited
England and Wales
Experian Europe Unlimited
England and Wales
Experian Finance 2012 Unlimited
England and Wales
Experian Finance plc
England and Wales
Experian Group Limited
England and Wales
Experian Holdings (UK) Unlimited
England and Wales
Experian Holdings Limited
England and Wales
Experian International Unlimited
England and Wales
Experian Investment Holdings Limited
England and Wales
Experian Latam Holdings Unlimited
England and Wales
Experian Limited
England and Wales
Company
Country of incorporation
Experian NA Holdings Unlimited
England and Wales
Experian NA Unlimited
England and Wales
Experian Nominees Limited
England and Wales
Experian Specialist Information Limited*
England and Wales
Experian SURBS Investments Limited
England and Wales
Experian Technology Limited
England and Wales
Experian US Holdings Unlimited
England and Wales
Experian US Unlimited
England and Wales
Experian Work Report Limited
England and Wales
G.U.S. Property Management Limited
England and Wales
GUS 1998 Unlimited
England and Wales
GUS 2000 Finance Unlimited
England and Wales
GUS 2000 UK Unlimited
England and Wales
GUS 2000 Unlimited
England and Wales
GUS 2002 Unlimited
England and Wales
GUS 2004 Limited
England and Wales
GUS 2005 Finance Unlimited
England and Wales
GUS Catalogues Unlimited
England and Wales
GUS Finance (2004) Limited
England and Wales
GUS Finance 2006 Unlimited
England and Wales
GUS Finance Holdings Unlimited
England and Wales
GUS Financial Services Unlimited
England and Wales
GUS Holdings (2004) Limited
England and Wales
GUS Holdings Unlimited
England and Wales
GUS International
England and Wales
GUS International Holdings UK Societas
England and Wales
GUS Ireland Holdings UK Societas
England and Wales
GUS NA Unlimited
England and Wales
GUS Netherlands Unlimited
England and Wales
GUS Overseas Holdings UK Societas
England and Wales
GUS Overseas Investments UK Societas
England and Wales
GUS Overseas Retailing Unlimited
England and Wales
GUS Overseas Unlimited
England and Wales
GUS Property Investments Limited
England and Wales
GUS Unlimited
England and Wales
GUS US Holdings UK Societas
England and Wales
GUS US Holdings Unlimited
England and Wales
GUS US Unlimited
England and Wales
GUS Ventures Unlimited
England and Wales
Hugh Wyllie, Limited
England and Wales
International Communication & Data Limited
England and Wales
Pay Dashboard Limited
England and Wales
QAS Limited*
England and Wales
Riverleen Finance Unlimited*
England and Wales
Runpath Group Limited
England and Wales
Runpath Pilot Limited*
England and Wales
Runpath Regulated Services Limited
England and Wales
Serasa Finance Limited
England and Wales
Tallyman Limited
England and Wales
Tapad UK Limited
England and Wales
Techlightenment Ltd*
England and Wales
The Royal Exchange Company (Leeds) Unlimited
England and Wales
The Witney Mattress, Divan & Quilt Co. Unlimited
England and Wales
Compuscan (Pty) Ltd
eSwatini/Swaziland
Experian France S.A.S.
France
Experian Holding EURL
France
Experian Holding France SAS
France
3 C Deutschland GmbH
Germany
1
Company
Country of incorporation
CONET Corporate Communication Network GmbH
Germany
2
Experian CarCert GmbH
Germany
3
Experian GmbH
Germany
2
Informa HIS GmbH
Germany
3
Informa Solutions GmbH
Germany
2
Infoscore Consumer Data GmbH
Germany
2
Tapad Germany GmbH
Germany
4
GHU Insurance Company Limited
Guernsey
Experian Credit Information Company of India Private
Limited
India
Experian Services India (Private Limited)
India
PT. Experian Decision Analytics Indonesia
Indonesia
Experian Europe Designated Activity Company
Ireland
Experian Group Services Limited
Ireland
Experian Holdings Ireland Limited
Ireland
Experian Ireland Investments Limited
Ireland
Experian Ireland Limited
Ireland
GUS Finance Ireland Unlimited Company
Ireland
GUS Investments 2003 Unlimited Company
Ireland
Experian Holding Italia S.r.l.
Italy
Experian Italia S.p.A.
Italy
Experian Japan Co., Ltd
Japan
Experian Lesotho (Pty) Ltd
Lesotho
Experian Information Services (Malaysia) Sdn. Bhd.
Malaysia
1
Experian (Malaysia) Sdn. Bhd.
Malaysia
1
Experian Marketing Services (Malaysia) Sdn Bhd
Malaysia
1
Ringgit Arajaya Sdn. Bhd.**
Malaysia
2
Experian de Mexico S. de R.L. de C.V.
Mexico
Experian Micro Analytics SAM
Monaco
Scorex SAM
Monaco
Experian Sistema de informacao de credito S.A
Mozambique
Experian Credit Reference Bureau (Pty) Ltd
Namibia
Experian Micro Analytics B.V.
The Netherlands
Experian Nederland BV
The Netherlands
Experian Scorex Russia B.V.
The Netherlands
GUS Europe Holdings BV
The Netherlands
GUS Holdings BV
The Netherlands
GUS Treasury Services BV
The Netherlands
Experian New Zealand Limited
New Zealand
Experian AS
Norway
1
Experian Gjeldsregister AS
Norway
1
Tapad Norway AS
Norway
2
APC Buró, S.A.
Panama
Experian Perú S.A.C.
Peru
Experian Philippines, Inc
The Philippines
Experian Polska spółka z ograniczoną odpowiedzialnością
Poland
Gabi Polska Spółka Z Ograniczoną Odpowiedzialnością
Poland
DP Management Pte Ltd
Singapore
Experian Credit Bureau Singapore Pte. Ltd.
Singapore
Experian Credit Services Singapore Pte. Ltd.
Singapore
Experian Asia-Pacific Holdings Pte. Ltd.
Singapore
Experian Singapore Pte. Ltd
Singapore
Compuscan Holdings International (Pty) Ltd
South Africa
1
CSH Group (Pty) Ltd
South Africa
1
Experian South Africa (Pty) Limited
South Africa
2
Great Universal Stores (South Africa) (Pty) Ltd
South Africa
2
Axesor Business Process Outsourcing S.L.U.
Spain
1
Company
Country of incorporation
Axesor Conocer Para Decidir, S.A.
Spain
1
Experian Bureau de Crédito, S.A.
Spain
2
Experian España, S.L.U.
Spain
2
Experian Holdings Espana, S.L.
Spain
2
Experian Latam España Inversiones, S.L.
Spain
3
Experian Switzerland AG
Switzerland
Experian (Thailand) Co., Ltd
Thailand
Experian Bilgi Hizmetleri Limited Şirketi
Turkey
Experian Uganda CRB Limited
Uganda
Auto I.D., Inc.
USA
1
BillFixers, LLC
USA
2
CIC Plus, LLC
USA
3
ClarityBlue Inc
USA
3
Clarity Services, Inc.
USA
2
ConsumerInfo.com, Inc
USA
4
CSIdentity Corporation
USA
2
CSIdentity Insurance Services, Inc.
USA
6
Employment Tax Servicing, LLC
USA
4
Experian Background Data, Inc.
USA
2
Experian Credit Advisors, Inc.
USA
2
Experian Data Corp
USA
2
Experian Employer Services, Inc.
USA
5
Experian Fraud Prevention Solutions, Inc.
USA
2
Experian Health, Inc.
USA
2
Experian Holdings, Inc.
USA
2
Experian Information Solutions, Inc.
USA
7
Experian Marketing Solutions, LLC
USA
2
Experian Reserved Response, Inc.
USA
2
Experian Services Corp.
USA
2
Frontline eSolutions, LLC
USA
8
Gabi Personal Insurance Agency, Inc.
USA
2
MyExperian, Inc.
USA
2
My Health Direct, Inc.
USA
2
RewardStock, Inc.
USA
2
Statschedules India, LLC
USA
2
String Automotive Solutions, Inc.
USA
2
String Enterprises, Inc.
USA
2
Tapad, Inc.
USA
2
Tayvah, LLC
USA
4
Tax Credit Co, LLC
USA
2
TCC Arizona, LLC
USA
9
TCC Services, LLC
USA
10
The 41st Parameter, Inc.
USA
2
Numeric superscripts refer to registered office addresses given
in note T(ii).
* In voluntary liquidation
** Ringgit Arajaya Sdn. Bhd was liquidated on 13 April 2023.
(ii) Addresses of registered offices of subsidiary undertakings
Country of incorporation
Address of registered office
Argentina
Carlos Pelligrini 887, 4th Floor, Ciudad Autonoma de
Buenos Aires, Buenos Aires
Australia
Level 26, 2 Southbank Boulevard, Southbank, VIC 3006
Austria
1
Gumpendorfer Straße 19-21/5. OG, 1060, Wien
Austria
2
Strozzigasse 10/14, 1080 Vienna
Botswana
Plot 64518 Deloitte House, Fairgrounds, Gaborone
Brazil
1
Avenida Presidente Vargas, 2921 – 6 Floor – Room
611, Vila Homero, Indaiatuba/SP, 13338–705
Brazil
2
Rua Dr. Léo de Carvalho, No. 74, 5th Floor, Suite 505,
Room 2, Ibiza Building,Velha, Blumenau, Santa
Catarina, 89036-239
Brazil
3
Rua Dr. Léo de Carvalho, No. 74, 5th Floor, Suite 505,
Room 1, Ibiza Building,Velha, Blumenau, Santa
Catarina, 89036-239
Brazil
4
Rua Dr. Léo de Carvalho, No. 74, 5th Floor, Suites 505,
506 and 507, Ibiza Building, Velha, Blumenau, Santa
Catarina, 89036-239
Brazil
5
Avenida das Nações Unidas, 14401 – Torre C-1 Parque
da Cidade Complex, Suites 191, 192, 201, 202, 211, 212,
221, 222, 231, 23, Chácara Santo Antônio, Sao Paulo/
SP, 04794-000
Bulgaria
86 Tsarigradsko shose boul., Mladost region, 1784
Sofia
Canada
199 Bay Street, Suite 4000, Toronto, Ontario M5L 1A9
Chile
1
Av el Golf 40 piso, 20 Santiago
Chile
2
Av. del Valle 515, Huechuraba, Santiago
Chile
3
Nueva Costanera 4091, Vitacura, Santiago de Chile
China
1
Room 604 6F, One Indigo, 20 Jiuxianqiao Road,
Chaoyang District, Beijing, 100015
China
2
Room 05D, 20th Floor, NO.77, Jianguo Road, Chaoyang
District, Beijing
China
3
31/F., Tower Two, Times Square, 1 Matheson Street,
Causeway Bay, Hong Kong
China
4
Room 05C, 20th Floor, NO.77, Jianguo Road, Chaoyang
District, Beijing
Colombia
Carrera 7, No. 76 -35 Floor 10, Bogota
Costa Rica
Edificio Oller Abogados, Provincia de 5551007, Av. 18,
San José Province, San José
Denmark
Lyngbyvej 2, DK-2100, Copenhagen
England and Wales
The Sir John Peace Building, Experian Way, NG2
Business Park, Nottingham, NG80 1ZZ
eSwatini/Swaziland
c/o PricewaterhouseCoopers, Rhus Office Park, Kal
Grant Street, Mbabane
France
19 boulevard Malesherbes, 75008 Paris
Germany
1
Edisonstraße 19, 74076, Heilbronn
Germany
2
Rheinstraße 99, 76532, Baden-Baden
Germany
3
Kreuzberger Ring 68, 65205, Wiesbaden
Germany
4
Walther-von-Cronberg-Platz 13, 60594 Frankfurt a. Main
Guernsey
PO Box 155, Mill Court, La Charroterie, St Peter Port,
GY1 4ET
India
5th Floor, East Wing, Tower 3, Equinox Business Park,
LBS Marg, Kurla (West), Mumbai, 400070
Indonesia
World Trade Centre 3 Lantai 27, Jl. Jendral Sudirman
Kav. 29-31, Kelurahan Karet, Kecamatan Setiabudi,
Kota Adm. Jakarta Selatan, DKI Jakarta
Ireland
2 Cumberland Place, Fenian Street, Dublin 2, D02 HY05
Italy
Piazza dell’Indipendenza No 11/B, 00185, Rome
Japan
xLINK Marunouchi Park Building, Marunouchi Park
Building 8F, 6-1, Marunouchi 2 chome, Chiyoda-ku,
Tokyo 100-6908
Country of incorporation
Address of registered office
Lesotho
Plot No. 582, Ha Hoohlo Extension, Maseru
Malaysia
1
10th Floor Menara Hap Seng, No. 1 & 3 Jalan P.
Ramlee, 50250 Kuala Lumpur, Wilayah Persekutuan
Malaysia
2
Ground, 1st, 2nd & 3rd Floors, Block B, Quill 18,
Lingkaran Teknokrat, 3 Barat, Cyber 4, 63000 Sepang,
Cyberjaya, Selangor
Mexico
Calle Pedregal 24 S 300 P 3 Col. Molino del Rey, Miguel
Hidalgo, Ciudad de México, CP 11040
Monaco
Athos Palace 2, Rue de la Lujerneta 6eme etage – lots
27 et 30, MC98000
Mozambique
Edifício Millennium Park, Avenida Vladimir Lenine, 174,
13°, Maputo
Namibia
C/O Aus Secretarial Services, Bougain Villas, 8 Sam
Nujoma Drive, Windhoek
The Netherlands
Grote Marktstraat 49, 2511BH's-Gravenhage
New Zealand
Level 9, 4 Williamson Avenue, Grey Lynn, Auckland,
1021
Norway
1
Professor Kohts vei 9, 1366 Lysaker, Bærum
Norway
2
5.etg. Edvard Storms gate, 20166, Oslo
Panama
Panamá Pacífico, International Business Park, Edif.
3845, 4to Piso, Ciudad de Panamá
Peru
Av. Canaval y Moreyra Nº 480, Piso 19, San Isidro, Lima
The Philippines
25th Floor Philam Life Tower, 8767 Paseo de Roxas,
Makati City
Poland
Henryk Sienkiewicz street 82/84; 90-318, Łódź
Singapore
10 Kallang Avenue, #05-18 Aperia Tower 2, Singapore,
339510
South Africa
1
Experian House, 3 Neutron Avenue, Techno Park,
Stellenbosch, 7600
South Africa
2
Experian House, Ballyoakes Office Park, 35 Ballyclare
Drive, Bryanston, Sandton, 2021
Spain
1
Calle Graham Bell, s/n, Edificio Axesor, Parque
Empresarial San Isidro, C.P. 18100, Armilla
Spain
2
C/Principe de Vergara 132, 2a Planta, 28002, Madrid
Spain
3
Principe de Vergara 131 1°, Madrid
Switzerland
Thurgauerstrasse 101a, CH-8152, Opfikon
Thailand
No. 9, G Tower Building, 33rd Floor, Rama 9 Road, Huai
Kwang, Bangkok
Turkey
River Plaza Büyükdere Cad.Bahar Sok.No:13 K:8 Levent
34394 İstanbul
Uganda
Plot 23, 3rd Floor, North Wing, Soliz House, Lumumba
Avenue, Nakasero, Kampala
USA
1
The Corporation Trust Company, 1209 Orange Street,
Wilmington DE 19801
USA
2
C T Corporation, 300 Montvue Road, Knoxville TN
37919-5546
USA
3
475 Anton Boulevard, Costa Mesa, CA 92626
USA
4
C T Corporation System, 818 West 7th Street, Los
Angeles, CA 90017
USA
5
C T Corporation System, 155 Federal Street, Ste 700,
Boston Massachusetts 02110
USA
6
208 South LaSalle St., Ste 814 Chicago IL 60604
USA
7
4400 Easton Commons Way, Ste 125, Columbus Ohio
43219
USA
8
3026 Woodbridge Lane, Canton, GA 30114
USA
9
2711 Centerville Rd Ste 400, Wilmington DE 19808
USA
10
255 W Sunset Blvd. Ste, 2200 Los Angeles CA 90028
Numeric superscripts refer to subsidiary undertakings given in note T(i).
(iii) Additional information on subsidiary undertakings
Summary
The results of the undertakings listed at note T(i) are included in the Group
financial statements. Except as indicated below, the Company has direct
or indirect interests in the whole of the issued equity shares of these
undertakings. Undertakings which are direct subsidiaries of the Company
are detailed in note N to these financial statements.
Since demerger from GUS plc in 2006, the Company has eliminated
dormant and inactive companies through an ongoing internal programme.
Holdings comprising less than 100%
Interests of less than 100% of the issued equity of subsidiary
undertakings are:
APC Buró, S.A. – 70.0%
Brain Soluções de Tecnologia Digital Ltda – 55.0%
DP Management Pte Ltd – 51.0%
Experian Australia Credit Services Pty Ltd – 92.05%
Experian Colombia S.A. – 99.9%
Experian Credit Information Company of India Private Limited – 66.7%
Experian Italia S.p.A. – 95.35%
Experian Information Services (Malaysia) Sdn. Bhd. – 74.0%
Experian South Africa (Pty) Limited – 87.5%
Serasa S.A. – 99.7%
Servicios de Información Avanzada Comercial Y Financiera S.A. – 66.7%
Holdings comprising other than ordinary shares, common stock or
common shares
The Company’s equity interests comprise direct or indirect holdings of
ordinary shares, common stock or common shares only, except as listed
below:
Experian Europe and Middle East Limited, Experian Soluciones de
Informacion, S.A. de C.V., GUS 2004 Limited and GUS Investments 2003
Unlimited Company – A ordinary and B ordinary shares
GUS International – B ordinary shares
GUS 2000 Unlimited – X ordinary and Y ordinary shares
Experian Holdings, Inc. – class A and B common stock
Experian Information Solutions Inc. – common no par value shares
Company
Holding
Country of incorporation
London & Country Mortgages Limited
25.0%
England and Wales
Who Owns Whom (Pty) Limited
32.9%
South Africa
Online Data Exchange LLC
25.0%
USA
Opt-Out Services, LLC
25.0%
USA
Central Source LLC
33.3%
USA
New Management Services, LLC
33.3%
USA
VantageScore Solutions, LLC
33.3%
Undertaking
Country of incorporation
or operation
Serasa Experian Pension Plan
Brazil
Brigstock Finance Limited
England and Wales
Experian Medical Plan Limited
England and Wales
Experian Pension Scheme
England and Wales
Experian Retirement Savings Plan
England and Wales
Experian Retirement Savings Trustees Limited
England and Wales
Experian Trustees Limited
England and Wales
Experian UK Approved All-Employee Share Plan
England and Wales
The Pension and Life Assurance Plan of Sanderson Systems Limited
England and Wales
Versorgungsordnung der Barclays Industrie Bank GmbH vom April 1988 (incl. amendments)
Germany
The Experian Ireland Pension Plan
Ireland
The Experian plc Employee Share Trust
Jersey
Compuscan Team Investment Trust
South Africa
Experian Personal Investment Plan
USA
These undertakings are not subsidiaries or associates. Brigstock Finance Limited is a finance company. The other undertakings operate in connection
with the Group’s share incentive plans, pension arrangements in the UK, the USA, Brazil, South Africa, Germany and Ireland, and the provision of medical
241
Experian plc
Annual Report 2023
Financial statements
Shareholder and corporate information
Analysis of share register at 31 March 2023
By size of shareholding
Number of
shareholders
%
Number of
shares
%
Over 1,000,000
135
0.7
798,598,948
82.2
100,001 to 1,000,000
369
1.9
129,443,255
13.3
10,001 to 100,000
733
3.7
25,094,899
2.6
5,001 to 10,000
521
2.6
3,571,541
0.4
2,001 to 5,000
1,825
9.3
5,527,166
0.6
1 to 2,000
16,088
81.8
9,139,671
0.9
Total
19,671
100.0
971,375,480
100.0
By nature of shareholding
Number of
shareholders
%
Number of
shares
%
Corporates
2,392
12.2
899,974,609
92.6
Individuals
17,278
87.8
19,178,513
2.0
Treasury shares
1
—
52,222,358
5.4
Total
19,671
100.0
971,375,480
100.0
Company website
A full range of investor information is available at
www.experianplc.com
.
Details of the 2023 AGM, to be held in Dublin, Ireland on Wednesday,
19 July 2023, are given on the website and in the notice of meeting.
Information on the Company’s share price is available on the website.
Electronic shareholder communication
Shareholders may register for Share Portal, an electronic communication
service provided by Link Market Services (Jersey) Limited, via the
Company website at
www.experianplc.com/shares
.
The service is free
and it facilitates the use of a comprehensive range of shareholder
services online.
When registering for Share Portal, shareholders can select their preferred
communication method – email or post. Shareholders will receive a
written notification of the availability on the Company’s website of
shareholder documents, such as the Annual Report, unless they have
elected to either (i) receive such notification by email or (ii) receive paper
copies of shareholder documents, where such documents are available
in that format.
Dividend information
Dividends for the year ended 31 March 2023
A second interim dividend in respect of the year ended 31 March 2023
of 37.75 US cents per ordinary share will be paid on 21 July 2023, to
shareholders on the register of members at the close of business on
23 June 2023. Unless shareholders elect by 23 June 2023 to receive
US dollars, their dividends will be paid in pounds sterling at a rate per
share calculated on the basis of the exchange rate from US dollars to
pounds sterling on 30 June 2023. A first interim dividend of 17.0 US cents
per ordinary share was paid on 3 February 2023.
Income Access Share arrangements
As its ordinary shares are listed on the London Stock Exchange, the
Company has a large number of UK resident shareholders. In order that
shareholders may receive Experian dividends from a UK source, should
they wish, the Income Access Share (IAS) arrangements have been put
in place. The purpose of the IAS arrangements is to preserve the tax
treatment of dividends paid to Experian shareholders in the UK, in respect
of dividends paid by the Company. Shareholders who elect, or are deemed
to elect, to receive their dividends via the IAS arrangements will receive
their dividends from a UK source (rather than directly from the Company)
for UK tax purposes.
Shareholders who hold 50,000 or fewer Experian plc shares on the first
dividend record date after they become shareholders, unless they elect
otherwise, will be deemed to have elected to receive their dividends under
the IAS arrangements.
Shareholders who hold more than 50,000 shares and who wish to receive
their dividends from a UK source must make an election to receive
dividends via the IAS arrangements. All elections remain in force
indefinitely unless revoked.
Unless shareholders have made an election to receive dividends via
the IAS arrangements, or are deemed to have made such an election,
dividends will be received from an Irish source and will be taxed
accordingly. The final date for submission of elections to receive
UK sourced dividends via the IAS arrangements is 23 June 2023.
Dividend Reinvestment Plan (DRIP)
The DRIP enables those shareholders who receive their dividends under
the Income Access Share arrangements to use their cash dividends to
buy more shares in the Company. Eligible shareholders, who wish to
participate in the DRIP in respect of the second interim dividend for the
year ended 31 March 2023, to be paid on 21 July 2023, should return
a completed and signed DRIP application form, to be received by the
registrars by no later than 23 June 2023. Shareholders should contact
the registrars for further details.
Experian plc
Shareholder and corporate information
242
Shareholder security
Shareholders are advised to be wary of any unsolicited advice, offers
to buy shares at a discount or offers of free reports about the
Company. More detailed information on such matters can be found
at
www.moneyhelper.org.uk
. Details of any share dealing facilities
that the Company endorses will be included on the Company’s website
or in Company mailings.
American Depositary Receipts (ADR)
Experian has a sponsored Level 1 ADR programme, for which J.P. Morgan
Chase Bank, N.A. acts as Depositary. This ADR programme is not listed
on a stock exchange in the USA and trades on the highest tier of the US
over-the-counter market, OTCQX, under the symbol EXPGY. Each ADR
represents one Experian plc ordinary share. Further information can be
obtained by contacting:
Shareowner Services
J.P. Morgan Chase Bank, N.A.
PO Box 64504
St. Paul, MN 55164-0504
USA
T +1 651 453 2128 (from the USA: 1 800 990 1135)
E Visit www.shareowneronline.com, then select ‘Contact Us’
W www.adr.com
Financial calendar
Second interim ex-dividend date
22 June 2023
Second interim dividend record date
23 June 2023
Trading update, first quarter
13 July 2023
AGM
19 July 2023
Second interim dividend payment date
21 July 2023
Half-yearly financial report
15 November 2023
Trading update, third quarter
17 January 2024
Preliminary announcement of full-year results
May 2024
Contact information
Corporate headquarters
Experian plc
2 Cumberland Place
Fenian Street
Dublin 2
D02 HY05
Ireland
T +353 (0) 1 846 9100
Investor relations
E investors@experian.com
Registered office
Experian plc
22 Grenville Street
St Helier
Jersey
JE4 8PX
Channel Islands
Registered number – 93905
ISIN – GB00B19NLV48
Registrars
Experian Shareholder Services
Link Market Services (Jersey) Limited
12 Castle Street
St Helier
Jersey
JE2 3RT
Channel Islands
T 0371 664 9245
T (for calls from outside the UK) +44 800 141 2952
E experian@linkregistrars.com
Calls are charged at the standard geographic rate and will vary by
provider. Calls from outside the United Kingdom will be charged at the
applicable international rate. Lines are open from 8.30am to 5.30pm (UK
time) Monday to Friday excluding public holidays in England and Wales.
Stock exchange listing information
Exchange: London Stock Exchange, Premium Main Market
Index: FTSE 100
Symbol: EXPN
243
Experian plc
Annual Report 2023
Shareholder and corporate information
Glossary
The following abbreviations are used in this Annual Report, and are taken to have the following meanings:
Abbreviation
Meaning
AFS
Arvato Financial Solutions
AGM
Annual General Meeting
AI
Artificial intelligence
APAC
Asia Pacific
API
Application Programming Interface
B2B
Business-to-Business
B2C
Business-to-Consumer
BEIS
Business, Energy and Industrial Strategy
Benchmark EBIT
Benchmark earnings before interest and tax. See note 7 to the Group financial statements
Benchmark EBITDA
Benchmark earnings before interest, tax, depreciation and amortisation. See note 7 to the Group financial statements
Benchmark EPS
Benchmark earnings per share. See note 7 to the Group financial statements
Benchmark operating cash flow
See note 7 to the Group financial statements
Benchmark PBT
Benchmark profit before tax. See note 7 to the Group financial statements
CCM
Experian's email/cross-channel marketing business (a discontinued operation)
CCPA
California Consumer Privacy Act
CDP
Formerly known as Carbon Disclosure Project, a non-profit charity that runs the global environmental disclosure system
CEO
Chief Executive Officer
CFO
Chief Financial Officer
CFPB
US Consumer Financial Protection Bureau
CGU
Cash-generating unit
CIP
Co-investment Plans
Code
The UK Corporate Governance Code
Company
Experian plc
COO
Chief Operating Officer
CPRA
California Privacy Rights Act
DEI
Diversity, equity and inclusion
DRIP
Dividend Reinvestment Plan
EITS
Experian Information Technology Services
EMEA
Europe, Middle East and Africa
EPS
Earnings per share
ERMC
Executive Risk Management Committee
ESEF
European Single Electronic Format
ESG
Environmental, Social and Governance
FBU
Fair, balanced and understandable
FCA
The UK Financial Conduct Authority
FCRA
Fair Credit Reporting Act
FRS
Financial Reporting Standard
FTC
US Federal Trade Commission
FTE
Full-time equivalent
FVOCI
Fair value through Other comprehensive income
FVPL
Fair value through profit or loss
FX
Foreign exchange rate(s)
FY19
Year ended 31 March 2019
FY20
Year ended 31 March 2020
FY21
Year ended 31 March 2021
FY22
Year ended 31 March 2022
FY23
Year ended 31 March 2023
FY24
Year ending 31 March 2024
FY25
Year ending 31 March 2025
GAAP
Generally Accepted Accounting Practice
GDP
Gross Domestic Product
GDPR
EU and UK General Data Protection Regulation
H1
The first half of Experian’s financial year, being the six months ending 30 September
H2
The second half of Experian’s financial year, being the six months ending 31 March
Experian plc
Glossary
244
Abbreviation
Meaning
HMRC
The UK’s ‘His Majesty’s Revenue and Customs’
IAS
International Accounting Standard
IAS arrangement
Income Access Share arrangement for the payment of dividends from a UK source
IASB
International Accounting Standards Board
IBOR
Interbank offered rate
IFRIC
International Financial Reporting Standards Interpretations Committee
IFRS or IFRSs
International Financial Reporting Standards
IP
Intellectual property
IRS
The US Internal Revenue Service
ISO
International Organization for Standardization
KPI
Key performance indicator
Last year
Year ended 31 March 2022
LGPD
Brazil General Data Protection Law
LIBOR
London Interbank Offered Rate
MSCIP
Marketing Services Consumer Information Portal
NED
Non-executive director
NGO
Non-governmental organisation
NPS
Net Promoter Score
OCI
Other comprehensive income
OECD
Organisation for Economic Co-operation and Development
OpCo
Group Operating Committee
The Policy
Directors’ remuneration policy
PSP
Performance Share Plan
Q1
The first quarter of Experian’s financial year, being the three months ending 30 June
Q2
The second quarter of Experian’s financial year, being the three months ending 30 September
Q3
The third quarter of Experian’s financial year, being the three months ending 31 December
Q4
The fourth quarter of Experian’s financial year, being the three months ending 31 March
ROCE
Return on capital employed
SaaS
Software-as-a-Service
SBTi
Science Based Targets initiative
SOFR
Secured Overnight Financing Rate
SONIA
Sterling Overnight Index Average
STEM
Science, technology, engineering, and mathematics
TCFD
Task Force on Climate-related Financial Disclosures
TD
EU’s Transparency Directive
This year
Year ended 31 March 2023
TSR
Total shareholder return
WACC
The Group’s pre-tax weighted average cost of capital
245
Experian plc
Annual Report 2023
Glossary
Sustainability: at a glance
Social
Improving financial health
Supporting UN Sustainable Development Goals – Targets
1.4, 8.10, 9.3
Number of people with profiles in Experian’s consumer information bureaux
1.5bn
Number of free consumer memberships
168m
Value of debt renegotiated by consumers through Experian's Limpa Nome Recovery Portal in FY23
US$8.9bn
Total people reached by our social innovation products since 2013 (Target of 100m by 2025)
106m
Total people connected through our United for Financial Health education programme since October 2020 (Target of 100m by 2024)
113m
Unbanked people who could benefit through alternative data sources and Experian technology platforms
1.4bn
Treating data with respect
Global Data Principles of security, accuracy, fairness, transparency and inclusion
Yes
Rigorous security controls based on ISO 27001
Yes
Cyber Essentials Plus Certification (UK)
Yes
Employees
Glassdoor employee rating
4.4
Gender diversity targets set
Yes
Signatory of the UN Women’s Empowerment Principles
Yes
Mandatory annual training for all employees: Code of Conduct, Security and data, and Anti-corruption
Yes
Employee engagement score
82%
Certified as a Great Place to Work
22 countries
Supply chain
A member of the Slave-Free Alliance
Yes
Suppliers must comply with our Supplier Code of Conduct, which is aligned with the UN Universal Declaration of Human Rights
Yes
Supplier Diversity Programme
Yes
Environment
Committed to becoming carbon neutral in our own operations by
2030¹
Science-based target for 2030 set
Yes
Scope 1 and 2 market-based emissions since 2022
Reduced by 38%
Scope 3 emissions since 2022
Reduced by 1%
Carbon intensity (CO
2
e per US$1m of revenue) since 2022
Reduced by 9%
Carbon emissions offset during the year (Scope 1 and 2)
60%
Electricity from renewable sources
62%
CDP Climate Change score
A-
CDP Supplier Engagement Rating
A-
Governance
Independent Board members, including independent Chair
73%
Female Board members
45%
Female Senior Independent Director
Yes
Board meets FTSE Women Leaders Review on gender equality
Yes
Ethnically diverse Board members
2
Board meets Parker Review Committee recommendation on ethnic diversity
Yes
Independence of Audit, Remuneration, and Nomination and Corporate Governance committees
100%
Independent Chair and clear division of responsibilities between the Chair and CEO
Yes
Independent external evaluation of the Board’s performance, occurs every three years
Yes
Executive remuneration linked to Group performance
Yes
Voting rights for ordinary shareholders
Yes
1
All references in this Annual Report to ‘carbon neutral in our own operations by 2030’ includes all Scope 1 and 2 emissions, as well as Scope 3 emissions from purchased goods and services, business travel
and fuel- and energy-related activities (which represent 83% of our baseline emissions in Scope 3) in line with the boundaries covered by our Scope 3 target approved by the Science Based Targets initiative (SBTi).
Once we have achieved our SBTi-approved targets, we will invest in high-quality carbon offsetting projects to offset the remaining Scope 1,2 and 3 emissions within the boundaries of our SBTi-approved targets
to achieve carbon neutrality in our own operations by 2030 .
Experian plc
Sustainability: at a glance
246
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Annual Report 2023
www.experianplc.com/Experian-Annual-Report-2023
Improving Financial Health Report 2023
www.experianplc.com/Experian-Improving-Financial-Health-Report-2023
Experian plc website
www.experianplc.com
Corporate
headquarters
Experian plc
2 Cumberland Place
Fenian Street
Dublin 2
D02 HY05
Ireland
T +353 (0) 1 846 9100
www.experianplc.com
Operational
headquarters
Experian
475 Anton Boulevard
Costa Mesa
CA 92626
United States
T +1 714 830 7000
www.experian.com
Serasa Experian
Av. Doutor Heitor
José Reali 360
CEP 13571-385
São Carlos
Brazil
T +55 11 3004 7728
www.serasaexperian.com.br
Experian
The Sir John Peace Building
Experian Way
NG2 Business Park
Nottingham
NG80 1ZZ
United Kingdom
T +44 (0) 115 941 0888
www.experian.co.uk