Boards must now confirm whether their material controls were effective at the balance sheet date under the updated UK Corporate Governance Code. Provision 29 applies to financial years beginning on or after 1 January 2026. Although the framework continues to follow a comply or explain approach, expectations around transparency, supporting evidence and accountability have clearly increased.
This shift has elevated the importance of materiality. Identifying material controls is no longer a routine compliance task. It is a clear reflection of how an organisation defines risk, protects performance and prepares for long term resilience. It also gives boards an opportunity to communicate priorities to investors and stakeholders in a structured and credible way.
Your material controls list is more than a regulatory requirement. It sends a message.
Material controls reflect strategic priorities
Provision 29 requires the board to decide which controls are material based on strategic risk, stakeholder impact and sustainability considerations. That judgement speaks volumes.
A well defined list demonstrates that the board understands what drives value and which risks could meaningfully affect performance. It supports a consistent narrative that links strategy governance and execution. When stakeholders can see a logical connection between business objectives and the controls selected, confidence grows.
Clarity in material controls signals disciplined governance. It shows that leadership has focused attention where it truly matters.
A focused material controls list builds credibility
The Code requires coverage across financial operational reporting and compliance controls. However it does not require every control to be classified as material.
A concise and carefully considered list communicates that the organisation has prioritised effectively. It shows that the board has distinguished between what is important and what is essential. Rather than creating an extensive inventory that blurs focus, a targeted approach highlights the controls that directly influence performance and risk exposure.
The objective is not to capture everything. It is to identify the controls that genuinely shape outcomes. A selective list reflects maturity and confidence. An overly broad list can unintentionally signal uncertainty about core priorities.
Align material controls with future direction
Many internal control frameworks were originally designed around historic reporting requirements. The revised governance expectations now extend across financial operational reporting and compliance areas in a more integrated way.
Boards should use this moment to align material controls with the organisation’s forward strategy. Consider evolving strategic risks. Examine processes that drive revenue or shape customer experience. Review areas where regulatory scrutiny is increasing. Assess operational dependencies that influence resilience.
When material controls mirror the organisation’s current operating environment and long term ambitions, governance appears forward looking rather than reactive. This alignment demonstrates that risk management and internal controls are supporting growth and sustainability.
Board discussions shape the quality of materiality decisions
Effective materiality assessments rarely emerge from standard templates alone. They result from thoughtful boardroom discussion that balances judgement perspective and risk appetite.
Strong boards evaluate whether the proposed material controls align with strategy and principal risks. They question whether each control provides meaningful insight. They consider whether the overall list reads coherently when viewed alongside strategic objectives.
These conversations ensure that the final declaration is balanced defensible and aligned with the organisation’s governance framework.
Investors expect consistency and transparency
Under Provision 29 boards must explain how the internal control framework was monitored and reviewed. They must declare whether material controls were effective and outline actions taken when weaknesses were identified.
Investors and stakeholders will look for consistency between strategic objectives principal risks selected material controls supporting evidence and remediation steps.
When these elements align the organisation presents a credible governance story. When gaps appear confidence can weaken.
Material controls shape governance identity
The introduction of Provision 29 has moved materiality from a technical assessment to a visible governance decision. The controls selected reflect how leadership defines long term success and how seriously it approaches internal controls risk management and corporate governance.
A well structured material controls list helps communicate that governance supports strategy risk oversight and sustainable performance. When approached thoughtfully materiality becomes more than a compliance exercise. It becomes a strategic advantage that strengthens transparency accountability and investor trust.
