Governance  
Report
Board Governance
54
Nomination & Governance Committee report
74
Reputation & Responsibility Committee report
78
Audit Committee report
80
Directors’ remuneration report
88
Additional disclosures
120
Annual report and accounts 2022 Pearson plc 53

Chair’s Letter
Dear shareholders,
It is a pleasure to introduce our Governance Report for 2022. In my 
first year as Chair, I have drawn great confidence from the disciplined 
approach to governance at Pearson, and the high calibre of our 
Board members. Their expertise and integrity have helped to cement 
our strong financial position in 2022 and to advance our purpose: to 
add life to a lifetime of learning.
Strategy and performance 
The Board has been heavily engaged with the management team in 
overseeing the implementation of our growth strategy, with a 
particular focus on embedding operational discipline around the new 
business divisions. This has helped to ‘right-size’ the business and 
achieve significant efficiencies that have accelerated our margin 
improvement expectations.
A highlight of 2022 was the completion of the first year of Pearson+. 
With 4.8 million registered users in that full calendar year, it is an 
important milestone in our journey to realise a digital ecosystem for 
lifelong learning. Developing our workforce skills strategy has been 
another priority for the Board in 2022. With more than 2,000 
enterprise learning clients, it is the next big opportunity for Pearson 
to support employers and employees through Assessment & 
Qualifications, Workforce Skills, and English Language Learning.
The Board also continued to reshape and refine Pearson’s portfolio 
in support of our strategy through both acquisitions and divestitures. 
In 2022, we acquired consumer language learning app Mondly, a 
cornerstone of our direct to consumer approach in English Language 
Learning – you can read more about this acquisition and the Board’s 
considerations in relation to it on page 69. Another consumer-
focused acquisition was the digital credentials platform Credly, 
through which we are tapping into the vast and growing focus for 
learners to be able to evidence their achievements and progress 
through digital certification. It is also valued by employers to 
encourage skills development in their workforces and has issued 
more than 50 million credentials, with some 70,000 new joiners a 
week. Additionally, the Board oversaw the sale, through a number  
of transactions, of much of our K-12 publishing businesses in 
international markets.
The Board was instrumental in assessing and responding to three 
unsolicited takeover approaches to the company from investment 
firm Apollo Global Management. After careful consideration, the 
Board voted unanimously to reject the approaches as we believed 
they all significantly undervalued the company. We thank you, our 
shareholders, for your support in the Board’s position. 
The Board continued to pay close attention to maintaining a strong 
financial position, which enabled us to increase the dividend in 2022, 
in line with our progressive dividend policy. We were also able to 
launch a £350m share buyback programme, while remaining well 
placed to pursue strategic opportunities as they arose, such as the 
announcement in December of our proposed acquisition of 
Personnel Decisions Research Institute (PDRI), which we look forward 
to completing subject to receiving the relevant clearances. 
As part of monitoring execution and performance, the Board 
regularly receives a dashboard that allows Directors to monitor 
progress on Pearson’s financial and strategic priorities, supported by 
agreed indicators and milestones identified as key measures of 
performance. While we work to embed the strategy, we will continue 
to refine this dashboard to ensure it includes the right key 
performance indicators (KPIs) to monitor our progress. You can read 
more about those KPIs on page 18 of this annual report.
The Board’s oversight of performance and risk is underpinned  
by the excellent work of our Audit Committee, which you can read 
more about on pages 80-87, including a number of strategic risk 
deep dives and a particular focus on data privacy and cyber security, 
as well as overseeing the important matter of our external audit 
transition in 2022.
Sustainability, stakeholder engagement and culture
As the world’s leading learning company, Pearson recognises its 
enormous potential to make a positive impact on people and the 
planet, as outlined in our environmental, social and governance (ESG) 
framework, which you can learn more about on page 30. The 
Reputation & Responsibility Committee has primary responsibility for 
monitoring and inputting into Pearson’s sustainability strategy and 
initiatives on behalf of the Board, with more on this described in the 
Committee’s report starting on page 78.
Understanding the views and priorities of all our stakeholders is key 
to running a successful, sustainable company that meets the needs 
of learners, educators, governments and employers. You can read 
more about the Board’s engagement activities in the section 
Understanding our stakeholders on page 67. The Board has engaged 
extensively with our larger shareholders regarding Pearson’s 
proposed new Directors’ remuneration policy to be tabled to 
shareholders at the 2023 AGM. More information on remuneration 
and the Board’s engagement work, through the Remuneration 
Committee, is included in the Directors’ remuneration report starting 
on page 88.
Our Employee Engagement Network remained a valuable forum for 
the Board to hear employee views in 2022, supported by our Board 
members Sherry Coutu and Annette Thomas. Read more about this 
engagement, and plans for evolving the Board’s engagement with the 
workforce, on page 68. Promoting a diverse and inclusive workforce 
environment throughout Pearson remains a Board priority and 
relevant KPIs form part of the regular dashboard reviewed by the 
Board. We have accelerated our progress on improving our 
workforce diversity, but we also recognise there is more to be done. 
Talent development and succession planning are also ongoing 
themes in the work of the Board and its Committees, and the Board 
runs a mentoring programme to support senior talent. The Board 
has been working with Ali Bebo, Pearson’s Chief Human Resources 
Officer, to assess our culture and employee engagement levels. It is 
also supporting the executive management team to drive a culture of 
performance and accountability throughout the organisation, which 
is covered in more detail on page 65. 
“A focus on strategic clarity, 
operational discipline and 
sustainable success for the  
benefit of all stakeholders.”
54 Pearson plc Annual report and accounts 2022
Board composition, succession and evaluation
As a Board, we pride ourselves on the diverse backgrounds, 
perspectives and skill sets of our Directors, whose range of expertise 
includes digital and direct to consumer strategy and business 
models, sustainability, education and workforce learning, and 
leadership of global, complex organisations through periods of 
transformation and disruption, as well as, of course, financial 
acumen. I am excited to contribute my own leadership experience 
from Twitter, Google and other tech businesses. You can read more 
about the Board’s skills and experience on page 75.
New appointments during 2021 and 2022 significantly enhanced the 
diversity of our Board, as you can see on page 59. We will continue to 
monitor the Board’s composition to ensure we maintain the range of 
skillsets and perspectives needed to support the company’s strategy 
and complement our succession planning.
I would like to take this opportunity to thank my predecessor Sidney 
Taurel, who led Pearson with distinction for six years, steering its 
restructuring and digital transformation. Under his tenure, Pearson 
became a more streamlined, agile and interconnected company,  
and he leaves us with a strong strategy and a balance sheet primed 
for growth. 
Likewise, on behalf of all Directors I extend our gratitude to Linda 
Lorimer, who reached nine years with the Board in 2022 but, as 
explained last year, has stayed on until the 2023 AGM to support  
a smooth handover to our new Board members. As Chair of the 
Reputation & Responsibility Committee and a member of the  
Audit Committee, Linda has been a resounding voice of wisdom  
and independent judgement, supported by her insight from 40 years 
serving in higher education. We send Linda our very  
best wishes for the future. I am delighted that Annette Thomas  
has agreed to succeed Linda as Chair of the Reputation & 
Responsibility Committee.
Esther Lee joined the Board as a Non-Executive Director in early 
2022, bringing significant experience through executive leadership 
roles with global consumer-facing brands. Already, she has made a 
strong contribution to the Board and as a member of our 
Remuneration and Nomination & Governance Committees. Both 
Esther and I greatly benefited from the induction processes 
organised for us upon joining Pearson, which are described further 
on page 70. 
The Board is fully engaged in planning for future retirements, and 
closely monitors the evolution of skill sets needed to drive the 
company forward. More detail about the Board’s succession planning 
can be found in the Nomination & Governance Committee report on 
pages 74-77.
I was pleased to lead the annual Board evaluation process in 2022, 
which is described on pages 71-73. This provided a wonderful 
opportunity for me to obtain an overall picture of the Board’s 
dynamics and views. We have a robust governance approach that will 
be the bedrock of delivering our strategy. At a time of pivotal strategic 
development for the company, I have worked with the Board to 
assess Board and Committee cadence, to empower the Committee 
Chairs to drive their agendas and to support the Board’s 
opportunities to engage in rich strategy discussions, while also 
ensuring a focus on operational excellence. 
As part of this, we have reviewed the remit of each Committee and 
how we collaborate on organisation-wide topics, such as culture and 
sustainability – more detail on the Board and Committees’ 
collaboration on ESG oversight is set out on page 66, as part of our 
explanation of how the Board is kept informed on relevant matters.
Conclusion 
I hope this report explains clearly to you how Pearson is run and how 
we align governance and our Board agenda with our strategic 
direction. Shareholders are always welcome to put their questions or 
feedback to us, either via our website (www.pearsonplc.com) or at 
our AGM. Once again this year, shareholders will be able to join us 
and vote at our AGM either in person or virtually. Details will be 
included in the forthcoming AGM notice. 
It only remains for me to thank our shareholders for their continued 
support and interest in this fantastic company. It has been a privilege 
to step into the role of Chair and I look forward to maintaining our 
stakeholders’ confidence as we seek to capture Pearson’s enormous 
growth potential as a lifelong digital partner for learners everywhere. 
Omid Kordestani
Chair
Compliance with the UK Corporate 
Governance Code 
The principles set out in the UK Corporate Governance Code (the 
‘Code’) emphasise the value of good corporate governance to 
the long-term sustainable success of listed companies. The 
Pearson Board is responsible for ensuring that the Group has in 
place appropriate frameworks to comply with the Code’s 
requirements. This governance report and the strategic report 
set out how Pearson has applied the principles of the Code 
throughout the year.
The Board believes that during 2022 the company was in full 
compliance with all applicable principles and provisions of the 
Code, save that, as described last year, Pearson is not fully 
compliant with Provision 36 of the Code on the basis that the 
shares awarded under the Chief Executive’s co-investment award 
made in 2020 are subject to a post-vesting holding period until 
31 December 2023, rather than the total vesting and holding 
period of five years or more required by the Code. Further detail 
is provided in the Directors’ remuneration report. 
Annual report and accounts 2022 Pearson plc 55

Board of Directors
Pearson Board members bring a wide range of experience, skills and 
backgrounds which complement our strategy.
All Board members have strong 
leadership experience at global 
businesses and institutions.  
Our Board members’ 
biographies illustrate the 
contribution each Director 
makes to the Board by way of 
their individual experience.
Key to Committees 
A  Audit
NG Nomination & Governance
RR  Reputation & Responsibility
R  Remuneration
 Committee Chair
Current notable commitments 
reflect other listed company 
directorships and full-time or 
executive roles.
RR
NG
Omid Kordestani
Chair
Aged 59
Omid is an international 
businessman who serves on the 
boards of Klarna Bank AB and Klarna 
Holding AB and is a Council Member 
for Balderton Capital. He was 
Executive Chair of Twitter, Inc. 
between October 2015 and May 
2020, and a Board Member until 
October 2022. From August 2014 to 
August 2015, Omid served as Senior 
Vice President and Chief Business 
Officer at Google and previously 
from May 1999 to April 2009 as 
Senior Vice President of Global Sales 
and Business Development. From 
1995 to 1999, Omid served as Vice 
President of Business Development 
at Netscape Communications 
Corporation. Prior to joining 
Netscape Communications 
Corporation, Omid held positions in 
business development, product 
management and marketing at The 
3DO Company, Go Corporation and 
Hewlett-Packard Company.
First appointed to the Board  
1 March 2022 
Chair since 29 April 2022
Chief Executive
Aged 59
Andy Bird, CBE
Andy has a long and distinguished 
career spanning over 35 years  
in the media industry, and he  
is an accomplished, strategic  
leader of global consumer  
content businesses. 
Most recently, he spent 14 years 
working for The Walt Disney 
Company, joining the business as 
President of Walt Disney 
International in 2004 before being 
appointed Chair in 2008. He held this 
role for a decade, during which time 
he transformed the organisation 
into a digital-first, direct to consumer 
business, focused on serving the 
diverse needs of customers around 
the world. In addition, Andy worked 
to establish the iconic brand in 
China, through the creation of 
Disney English, teaching English 
language to local families through 
immersive learning experiences. 
Prior to Disney, Andy worked in a 
number of senior positions at AOL 
Time Warner, and spent the earlier 
part of his career at Piccadilly  
Radio, Virgin Broadcasting  
Company, BSB Music Channel,  
Big & Good Productions, and  
Unique Broadcasting.
First appointed to the Board  
1 May 2020  
Chief Executive Officer since  
19 October 2020
Chief Financial Officer
Aged 49
Sally Johnson
Sally joined Pearson in 2000 and has 
held various finance and operations 
roles across the business, both at a 
corporate level and within the 
divisions, including The Penguin 
Group. She brings to the Board 
extensive commercial and strategic 
finance experience as well as 
expertise in transformation, 
treasury, tax, risk management, 
business and financial operations, 
investor relations and mergers  
and acquisitions. She has held 
various senior-level roles across  
the business, most recently as 
Deputy CFO of Pearson. Sally is a 
member of the Institute of 
Chartered Accountants in England 
and Wales and trained at 
PricewaterhouseCoopers.  
She was also a Trustee for the 
Pearson Pension Plan from  
2012 to 2018.
Chief Financial Officer since  
24 April 2020
Appointment
Skills and experience
Leading the way
56 Pearson plc Annual report and accounts 2022
RR
NG
A
RR
A
NG
R
R
Non-Executive Director
Aged 59
Sherry Coutu, CBE
Sherry is a seasoned non-executive 
director with extensive plc 
experience in the financial services, 
technology, and education sectors 
where she has held numerous senior 
leadership positions, including Chair, 
Senior Independent Director, and 
Chief Executive Officer. Prior to her 
portfolio career, Sherry founded 
several technology companies and 
invested in 70 companies and five 
venture capital firms.
Presently, Sherry serves as the Chair 
of Workfinder, a technology start-up 
specialising in AI-based recruitment 
services, and Raspberry Pi, a 
computer company. Sherry’s 
previous non-executive director 
experience includes the London 
Stock Exchange Group plc, DCMS, 
Zoopla plc, and RM plc. She has also 
served on the Advisory Boards of 
LinkedIn, the National Gallery, the 
Royal Society, and NESTA.
Non-Executive Director since  
1 May 2019
Non-Executive Director
Aged 64
Esther Lee
Esther brings significant experience 
to the Pearson Board through her 
prior executive leadership roles in 
developing customer strategies to 
drive growth, global marketing and 
branding; driving digital 
transformation; and building 
high-performance teams.
She has a long track record of senior 
leadership roles working for global 
consumer-facing brands. Most 
recently, she served as Executive 
Vice President – Global Chief 
Marketing Officer at MetLife Inc. 
Previously, Esther served as Senior 
Vice President – Brand Marketing, 
Advertising and Sponsorships for 
AT&T, and she has served as CEO of 
North America and President of 
Global Brands for Euro RSCG 
Worldwide. Prior to that, she served 
for five years as Global Chief Creative 
Officer for The Coca-Cola Company.
Esther is a Board member at 
The Clorox Company where 
she chairs the Nomination 
& Governance Committee.
Current notable commitments
The Clorox Company  
(Non- Executive Director)
Non-Executive Director since  
1 February 2022
Non-Executive Director
Aged 70
Linda Lorimer
Linda is currently a Senior Advisor at 
the Boston Consulting Group and 
has spent almost 40 years serving 
higher education. She retired from 
Yale in 2016 after 34 years at the 
university where she served in an 
array of senior positions, including 
Vice President for Global and 
Strategic Initiatives. She oversaw the 
development of Yale’s online 
education division and the 
expansion of Yale’s international 
programmes and centres. During 
her tenure, she was responsible for 
many administrative services, 
ranging from Yale’s public 
communications and alumni 
relations to sustainability, human 
resources, and the university press. 
She also served on the boards of 
several public companies, including 
as Presiding Director of the 
McGraw-Hill companies. Linda is a 
member of the Board of Yale New 
Haven Hospital, where she chairs the 
Nomination & Governance 
committee. She also remains on 
several consequential advisory 
committees at Yale University.
Non-Executive Director since  
1 July 2013
Non-Executive Director
Aged 56
Graeme Pitkethly
Graeme is the Chief Financial Officer 
and a Board member of Unilever. He 
joined Unilever in 2002 and, prior to 
his appointment as the CFO, was 
responsible for its UK and Ireland 
business. He also held a number of 
senior financial and commercial 
roles within Unilever and spent the 
earlier part of his career in senior 
corporate finance roles in the 
telecommunications industry. 
Graeme served as Vice President of 
Financial Planning and Vice President 
of Corporate Development at FLAG 
Telecom and started his career at 
PricewaterhouseCoopers. Graeme is 
a Vice Chair of the Task Force on 
Climate-Related Financial 
Disclosures, a Member of the 
Strathclyde University Centre for 
Sustainable Development and is a 
Chartered Accountant.
Current notable commitments
Unilever plc (Chief Financial Officer)
Non-Executive Director since  
1 May 2019
Appointment
Skills and experience
Annual report and accounts 2022 Pearson plc 57

Board of Directors continued
R
R
NG RR
A
RR
A
NG
Deputy Chair and Senior 
Independent Director
Aged 62
Tim Score
Tim has extensive experience of the 
technology sector in both developed 
and emerging markets, having 
served for 13 years as CFO of ARM 
Holdings plc, the world’s leading 
semiconductor IP company. He is an 
experienced Non-Executive Director 
and was appointed as a Non-
Executive Director of Bridgepoint 
Group PLC in 2021, alongside his 
roles as Chair of The British Land 
Company plc, a Non-Executive 
Director of the Football Association, 
and a Trustee of the National 
Theatre. Tim has garnered extensive 
financial and listed company 
experience during previous and 
current positions. He served on the 
board of National Express Group plc 
from 2005 to 2014, including time as 
interim Chair and six years as SID. 
Earlier in his career, Tim held senior 
finance roles with Rebus Group, 
William Baird, LucasVarity plc and 
BTR plc.
Current notable commitments 
The British Land Company plc 
(Chair), Bridgepoint Group PLC 
(Non-Executive Director)
Non-Executive Director  
since 1 January 2015
Senior Independent Director  
since 30 April 2021
Deputy Chair since 29 April 2022
Non-Executive Director 
Aged 57
Annette Thomas
Annette has a 25-year track record in 
leading global publishing and data 
analytics businesses, across 
academic, educational and 
consumer media verticals. Most 
recently, she served as CEO of 
Guardian Media Group, a position 
she held until June 2021. Prior to this, 
Annette was CEO of the Web of 
Science Group at Clarivate Analytics, 
a data, analytics and software 
business focused on research and 
higher education. She has also 
served as CEO of Macmillan 
Publishers and led the digital and 
global transformation of Nature 
Publishing Group. 
She currently serves as Senior 
Advisor to General Atlantic. Her 
previous non-executive experience 
includes serving as a Trustee of Yale 
University, Non-Executive Director 
at Clarivate Analytics (2017), and  
as a Board member for Cambridge 
University Press and Cambridge 
Assessment (2019-2020).  
She has also previously acted  
as an advisor to Creative Commons 
and Bain Capital.
Non-Executive Director  
since 1 October 2021
Non-Executive Director 
Aged 62
Lincoln Wallen
Lincoln has extensive experience in 
the technology and media 
industries, and is currently CTO of 
Improbable, a technology start-up 
supplying next-generation cloud 
hosting and networking services to 
the video game industry. Lincoln was 
CEO of DWA Nova, a software-as-a-
service company spun out of 
DreamWorks Animation Studios in 
Los Angeles, a position he held until 
2017. He worked at DreamWorks 
Animation for nine years in a variety 
of leadership roles including CTO 
and Head of Animation Technology. 
He was formerly CTO at Electronic 
Arts Mobile, leading their entry into 
the mobile gaming business 
internationally. Lincoln is a 
Non-Executive Director of the Smith 
Institute for Industrial Mathematics 
and Systems Engineering, and Varjo, 
a manufacturer of augmented, 
virtual and mixed reality headsets 
for professionals. His early career 
involved 20 years of professional IT 
and mathematics research, including 
as a Reader in Computer Science  
at Oxford.
Current notable commitments
Improbable  
(Chief Technology Officer)
Non-Executive Director  
since 1 January 2016
Appointment
Skills and experience
58 Pearson plc Annual report and accounts 2022
All of the Non-Executive Directors who served during 2022 were 
considered by the Board to be independent for the purposes of the UK 
Corporate Governance Code (the Code). The Board reviews the 
independence of each of the Non-Executive Directors annually. This 
includes reviewing their external appointments and any potential 
conflicts of interest, as well as assessing their individual circumstances in 
order to ensure that there are no relationships or matters likely to affect 
their judgement. In addition to this review, each of the Non-Executive 
Directors is asked to provide confirmation of their independence on an 
annual basis (as defined by the Sarbanes-Oxley Act, the New York Stock 
Exchange (NYSE) listing rules and the Code). 
In January 2024, Mr Score will reach nine years’ service on the Pearson 
Board. Upon or in anticipation of attainment of nine years’ service by 
any Non-Executive Director, the Board undertakes an assessment to 
satisfy itself as to the continuing independence of that Director. The 
Nomination & Governance Committee gave particular consideration to 
Mr Score’s independence in March 2023 ahead of proposing to 
shareholders that he be re-appointed for a further year at the 
forthcoming Annual General Meeting, recognising that he will reach nine 
years’ service during the coming year, if re-elected. In doing so, the 
Committee assessed the degree of objective judgement and 
constructive challenge demonstrated by Mr Score, and confirmed that 
his skills, experience and knowledge contribute to productive Board 
discussions. Accordingly, the Board is satisfied that Mr Score remains 
independent, and that he continues to provide constructive challenge 
and hold management to account.
This data reflects Directors in office as at 31 December 2022. To learn more about Board diversity, please see page 76. For diversity data in the format 
prescribed by LR 9.8.6R(10), please see page 225. 
1. Ethnicity categories are based on the UK’s Office for National Statistics classification.
Board composition
Gender
Ethnicity1
Asian/Asian British
Mixed/Multiple ethnic groups
White
2
1
7
Female
Male
5
5
Nationality
Tenure
Under 3 years
3-6 years
Over 6 years
2
5
3
American
American/British
British
Canadian
3
4
2
1
In accordance with the Code, Omid Kordestani was considered to be 
independent upon his appointment as Chair on 29 April 2022. 
As originally described in the 2022 Notice of AGM, Linda Lorimer will be 
retiring from the Board at the 2023 AGM and will not be seeking 
re-election. In 2022, the Committee assessed Ms Lorimer’s 
independence, having regard to, among other factors, the Financial 
Reporting Council’s Guidance on Board Effectiveness, and concluded 
that Ms Lorimer remained independent. In assessment of her own 
independence, undertaken in February 2023 to address the 
requirements of the NYSE, Sarbanes-Oxley Act, and the Code, Ms 
Lorimer did not declare any matters which may cause her 
independence to be questioned.
The Directors can obtain independent professional advice, at the 
company’s expense, in the performance of their duties. All Directors 
have access to the advice and services of the Company Secretary, whose 
appointment and removal is a matter reserved for the full Board.
Independence of Directors
Annual report and accounts 2022 Pearson plc 59

These figures reflect the executive team excluding the Company Secretary. The Chief Executive and Chief Financial Officer have been excluded and are counted in the Board metrics on  
page 59. For diversity data in the format prescribed by LR 9.8.6R(10), please see page 225.
1. Ethnicity categories are based on the UK’s Office for National Statistics classification.
PEM Composition
Ethnicity1
Asian/Asian British
Mixed/Multiple ethnic groups
White
Other ethnic group
1
1
1
7
Gender
Female
Male
5
5
Ali Bebo 
Tim Bozik 
Lynne Frank 
Gio Giovannelli 
Chief Human 
Resources Officer
Aged 54
Ali is a senior executive with 
over 25 years of experience 
building culture for 
transformative business 
performance across multiple 
industries. Prior to joining 
Pearson, she was an officer 
and CHRO for Hologic, Inc., a 
global medical technology 
company. Prior to Hologic, 
she held various HR 
leadership roles with the 
specialty retail company, 
ANN INC. Ali earned her BA in 
Political Science from the 
University of California,  
Los Angeles.
Interim Chief Product 
Officer and Co-
President, Direct to 
Consumer
Aged 61
Tim has more than 30 years 
of extensive leadership 
experience in higher 
education products and the 
business of delivering them 
at Pearson. Tim earned a 
Bachelor’s Degree from 
the University of Notre  
Dame and currently serves 
on the Board of Directors  
for the Association of 
American Publishers.
Chief Marketing 
Officer and Co-
President, Direct to 
Consumer
Aged 56
Lynne has over 25 years of 
experience in the media 
industry. Previously, she has 
worked in companies such as 
WarnerMedia, ESPN/Disney 
and Turner Broadcasting. 
Lynne holds a degree 
in economics and business, 
and a certificate in corporate 
board governance from the 
University of California, Los 
Angeles (UCLA).
President – English 
Language Learning
Aged 50
Gio has over 25 years of 
international business 
experience, including four 
CEO roles in Brazil.
Previous board roles include 
BOVESPA-listed Natura and 
CVC Viagens. Gio graduated 
from Bocconi University, 
holds an Economics PhD 
and is an OPM graduate of 
Harvard Business School.
 Joined Pearson 13 December 
2021
Appointed to the PEM  
13 December 2021
Joined Pearson 18 May 1998
Appointed to the PEM  
23 May 2013
 Joined Pearson 16 November 
2020
Appointed to the PEM  
16 November 2020
 Joined Pearson 1 February 
2014
Appointed to the PEM  
1 April 2016
Key
 Internal appointment
 External appointment
Tom ap Simon 
President – Higher 
Education and Virtual 
Learning
Aged 44
Tom has 19 years of 
international business and 
finance experience. At 
Pearson, he has led the 
Virtual Schools business, 
worked in finance for 
the emerging markets 
businesses and led M&A 
activity in the US. Previously, 
he worked in investment 
banking at RW Baird. Tom 
holds an MA in Economics 
and Politics from the 
University of Edinburgh.
Joined Pearson 1 December 
2004
Appointed to the PEM  
1 April 2021
Appointment
Skills and experience
Pearson Executive Management (PEM)
60 Pearson plc Annual report and accounts 2022
External/Internal Appointment
Internal
External
6
4
Nationality
American
British
Italian/Brazilian 
Canadian
2
2
5
1
Mike Howells 
Cinthia Nespoli 
Art Valentine 
Sulaekha ‘Sue’ 
Kolloru Barger 
Marykay Wells 
President – Workforce 
Skills
Aged 46
Mike has more than 20 years 
of international business 
experience. Previously, he 
has worked in the British 
diplomatic network and  
the UK Foreign, 
Commonwealth and 
Development Office. Mike 
holds a Master’s degree in 
International Law from the 
University of Nottingham 
and an Anthropology  
degree from University 
College London.
Chief Strategy Officer
Aged 47
Sue has more than 20 years 
of global strategy and 
corporate experience. 
Previously, she held 
engineering roles at 
technology companies. Sue 
holds an MBA from The 
Wharton School at the 
University of Pennsylvania 
and a BSc in electrical 
engineering from the 
University of Ottawa in 
Canada. She has served on 
several non-profit boards 
and councils focused on 
diversity and STEM.
Chief Legal Officer
Aged 42
President – 
Assessment & 
Qualifications
Aged 58
Chief Information 
Officer
Aged 60
Cinthia has over 19 years of 
international legal 
and compliance experience. 
Previously, she 
held leadership roles in legal 
and compliance 
at multinational companies. 
Cinthia was admitted to the 
Brazilian bar in 2004 and 
earned her law degree from 
Pontifícia Universidade 
Católica de Campinas as well 
as a post-graduate degree in 
tax law from Pontifícia 
Universidade Católica de  
São Paulo.
Art has more than 30 years of 
leadership experience in 
assessments, testing, and 
technology. Prior to his 16 
years at Pearson serving as a 
senior leader of Pearson VUE 
and as Managing Director of 
Pearson Clinical Assessment, 
Art worked at Promissor, 
which was acquired by 
Pearson in 2006. Art earned 
his MS in Mathematical 
Science/Computer Science 
from the University of North 
Carolina Chapel Hill.
Marykay has over 30 years of 
strategic planning and large, 
global technology 
transformation experience. 
Prior to joining Pearson, 
Marykay had CIO roles at 
Nortel, Tekelec (acquired by 
Oracle) and Extreme 
Networks. Marykay holds a 
BS degree in Computer 
Information Science from 
Clarkson University and is a 
member of the organising 
committee for the Accenture 
Women’s Summit, Salesforce 
Advisory Board, Google 
Leadership Advisory, and a 
member of the Gartner 
Research Board.
 Joined Pearson 1 December 
2020
Appointed to the PEM  
1 December 2020
Joined Pearson 16 May 2022
Appointed to the PEM  
16 May 2022
 Joined Pearson 1 February 
2014
Appointed to the PEM  
21 May 2020
Joined Pearson 23 January 
2006
Appointed to the PEM  
1 February 2022
 Joined Pearson 14 July 2014
Appointed to the PEM  
16 March 2022
Appointment
Skills and experience
Annual report and accounts 2022 Pearson plc 61

Division of responsibilities
The Board
The Board has established four formal Committees. The Committees focus on their own areas of 
expertise, enabling the Board meetings to focus on strategy, performance, leadership and people, 
governance and risk, and stakeholder engagement, thereby making the best use of the Board’s  
time together as a whole. The Committee Chairs report to the full Board at each Board meeting  
following their sessions, ensuring a good communication flow while retaining the ability to escalate  
items to the full Board’s agenda, if appropriate.
Nomination & 
Governance Committee  
Reviews corporate governance 
matters, including Code 
compliance and Board 
evaluation; considers the 
appointment of new Directors, 
Board experience and 
diversity; and reviews Board 
induction and succession  
plans as well as wider 
workforce engagement.
Reputation & 
Responsibility 
Committee 
Oversees our sustainability 
and ESG framework, including 
progress towards our 
sustainable business strategy 
commitments. Works to assess 
and advance Pearson’s 
reputation with stakeholders, 
including through the areas of 
branding, culture, employee 
engagement and values.
Audit Committee  
 
Appraises our financial 
management and reporting 
and assesses the integrity of 
our accounting procedures 
and financial controls. The 
Committee also oversees risk, 
compliance and internal audit. 
Remuneration 
Committee  
Determines the remuneration 
and benefits of the  
Executive Directors and 
oversees remuneration 
arrangements for the Pearson 
Executive Management team, 
as well as monitoring 
remuneration policies for the 
wider workforce.
Chair 
 
The Chair is primarily 
responsible for the leadership 
of the Board and ensuring its 
effectiveness. They ensure that 
the Board upholds and 
promotes the highest 
standards of corporate 
governance, setting the 
Board’s agenda and 
encouraging open, 
constructive debate of all 
agenda items for effective 
decision-making. They regularly 
meet the Chief Executive to 
stay informed and provide 
advice. They also ensure that 
shareholders’ views are 
communicated to the Board. 
Chief Executive 
 
The Chief Executive is 
responsible for the operational 
management of the business 
and for the development 
and implementation of the 
company’s strategy, as 
agreed by the Board and 
management. They are 
responsible for developing 
operations, proposals and 
policies for approval by  
the Board, they promote 
Pearson’s culture and 
standards, and they are  
one of the key representatives 
of the company to its  
external stakeholders. 
Deputy Chair and 
Senior Independent 
Director
The Deputy Chair and 
Senior Independent Director 
supports the Chair on Board 
effectiveness and governance 
matters. This role includes 
meeting regularly with the 
Chair and Chief Executive to 
discuss specific issues, as 
well as being available to 
shareholders generally, should 
they have concerns that have 
not been addressed through 
the normal channels. The 
Deputy Chair and Senior 
Independent Director also 
leads the evaluation of the 
Chair on behalf of the 
other Directors. 
Company Secretary 
 
The Company Secretary 
advises on governance matters 
and compliance with Board 
procedures. They are 
responsible, under the 
direction of the Chair, for 
ensuring the Board receives 
accurate, clear and high-quality 
information, and has adequate 
time and appropriate 
resources to function 
effectively and efficiently. 
They also support the Chair 
in delivering the corporate 
governance agenda, and 
organise director induction, 
training programmes and the 
Board evaluation process.
Standing Committee 
A Standing Committee of the 
Board is established to approve 
certain operational and ordinary 
course of business items such 
as banking matters, guarantees 
and intra-Group transactions. 
They also make routine 
approvals relating to employee 
share plans. Additional authority 
may be delegated on an ad-hoc 
basis, e.g. to approve and 
conclude corporate transactions.
Pearson Executive 
Management 
The Pearson Executive 
Management team consists 
of the Chief Executive and their 
senior direct reports. They are 
the executive leadership group 
for Pearson and are responsible 
for delivering Pearson’s 
strategy under clearly defined 
accountabilities and in line 
with agreed governance 
and processes. 
Authorities and duties 
The authorities and duties of 
the Board and its Committees, 
as well as the roles and 
responsibilities of key individuals 
on the Board, are clearly set out 
in writing. These documents are 
reviewed and approved by the 
Board on an annual basis and 
are available on the company’s 
website (www.pearsonplc.com).
62 Pearson plc Annual report and accounts 2022
Board activities
Board meeting focus during 2022
Strategy
Performance
Leadership & people
Governance & risk
Shareholder engagement
 
— Ongoing digital 
transformation
 
— Direct to consumer 
strategy
 
— Pearson+ 
performance
 
— Implementation of 
Group strategy
 
— Oversight of 
Four-Year Strategic 
Plan and approval of 
2023 annual 
operating plan 
 
— M&A pipeline and 
post-acquisition 
reviews, as well as 
consideration, 
approval and regular 
updates of major 
transactions 
 
— Enterprise and 
ecosystem strategic 
update 
 
— Data strategy
 
— 2021 preliminary results 
and annual report  
and accounts
 
— 2022 operating plan 
performance, including 
interim results and 
trading updates 
 
— Regular dashboard and 
milestone reports
 
— Continuing review  
of forecasts
 
— Final and interim 
dividend proposals
 
— Talent review, pipeline 
development and 
succession planning
 
— Culture
 
— DE&I initiatives
 
— Employee 
Engagement Network 
engagement and 
feedback 
 
— Employee survey 
assessments 
 
— Purpose, vision, 
mission and values
 
— Workforce learning  
and development
 
— Legal and regulatory 
governance compliance 
 
— Data privacy and cyber 
security matters
 
— Board and Committees’ 
effectiveness evaluation
 
— Regular review and 
annual confirmation of 
conflicts of interest 
 
— Approval of Committees’ 
terms of reference 
 
— Approval of division  
of responsibilities 
between Chair,  
Deputy Chair and Senior 
Independent Director, 
and Chief Executive
 
— Risk management 
report
 
— Investor relations 
strategy, updates, and 
share price 
performance 
 
— Shareholder issues  
and voting
 
— AGM and related 
shareholder interactions
 
— Feedback from Board 
member meetings with 
shareholders 
 
— Major shareholders and 
share register analysis
The role and business of the Board 
The key responsibilities of the Board include: 
 
— overall leadership of the company and setting the 
company’s values and standards, including monitoring 
culture and diversity, equity and inclusion (DE&I) initiatives 
 
— reviewing and determining the company’s strategy, 
including in relation to environmental, social and 
governance (ESG) matters, in consultation with 
management, assessing performance against the strategy 
and overseeing management’s execution of it 
 
— supervising major changes to the company’s corporate, 
capital, management and control structures 
 
— approval of all transactions or financial commitments in 
excess of the authority limits delegated to the Chief 
Executive and other executive management 
 
— assessment of management performance, Board and 
executive succession planning and talent pipeline 
 
— effective engagement with key stakeholders
Strategic planning and decision-making 
The Board spends considerable time assessing whether any 
proposed action aligns with the strategy and future direction of the 
business, while taking into consideration sustainability and impact on 
our stakeholders. In addition, the Board regularly holds strategy 
discussions, whether in relation to the specific strategies of Pearson’s 
five business divisions or the vision and wider strategy of the 
company as a whole, both of which enhance the Board’s decision-
making in shaping the company’s strategic and financial plans. 
The Board and Committees receive timely, regular and necessary 
financial, management and other information to discharge their 
duties. Comprehensive papers are circulated to Board and 
Committee members approximately one week in advance of each 
meeting. The Board receives a regular performance dashboard and 
key milestones report, together with updates from the Chief 
Executive and Chief Financial Officer. In addition to meeting papers, a 
library of current and historical corporate information is made 
available to Directors to support the Board’s decision-making 
process. For items that require significant consideration and review 
in advance of a decision, such as the portfolio changes during 2022 
in support of company strategy, the Board’s discussions can take 
place over a number of sessions.
The Board is deeply engaged in developing and measuring the 
company’s long-term strategy, performance, culture and values. We 
believe that Board members provide a valuable and diverse set of 
external perspectives and that robust, open debate about significant 
business issues brings an additional discipline to major decisions.
Annual report and accounts 2022 Pearson plc 63

Directors’ commitments and conflicts of interest
Under the Companies Act 2006 (the ‘Act’), the Directors have a 
statutory duty to avoid conflicts of interest with the company. The 
company’s Articles of Association allow the Directors to authorise 
conflicts of interest. The company has an established procedure to 
identify actual and potential conflicts of interest, including all 
directorships or other appointments to, or relationships with, 
companies that are not part of the Pearson Group and which could 
give rise to actual or potential conflicts of interest. Additionally, in 
response to Provision 15 of the UK Corporate Governance Code, 
Pearson has developed internal guidance to be taken into account 
when considering changes to a Director’s commitments, or when 
appointing a new Director, as well as formalising the Board approval 
process for such matters. 
Once notified to the company, any potential conflicts and 
commitments are considered for authorisation by the Board at its 
next scheduled meeting or, where necessary in the interests of 
timeliness, by a committee comprising the Chair, Senior Independent 
Director and Company Secretary. In particular, the Board or 
committee considers the type of role, expected time commitment 
and any impact this may have on the Director’s duties to Pearson, as 
well as any relationships between Pearson and the external 
organisation. The interested Director is not permitted to vote on, or 
be counted in the quorum for, any resolution relating to their 
commitments, conflict or potential conflict. The Board reviews any 
authorisations granted on an annual basis. 
When making new appointments in 2022, the Board considered 
other demands on Directors’ time. Esther Lee’s existing commitment 
as Non-Executive Director and Chair of the Nomination & 
Governance Committee at The Clorox Company, a NYSE-listed 
manufacturing company with a global portfolio, was considered as 
part of her appointment process. The Board agreed that Esther’s 
existing commitment would not have a negative impact on her ability 
to contribute to Pearson. 
Omid Kordestani’s existing commitments were considered as part  
of his appointment process. The Board was of the opinion that 
Omid’s additional notable commitment as a Board Member of 
Twitter, Inc. was acceptable as there were no conflicts perceived,  
and that his existing commitments would not prevent Omid from 
giving the time and attention that his role as the Chair of the Pearson 
Board would require. 
The Board believes that the experience gained by Directors through 
their other commitments brings valuable perspectives to the  
Pearson Board.
The Directors recognise their duties towards the shareholders  
and other stakeholders as set out in Section 172 of the Companies 
Act 2006, and a continued understanding of the key issues affecting 
stakeholders is an integral part of the Board’s decision-making 
process. You can read more on pages 67-69 about how the Board 
engages with stakeholders and takes their views into account when 
making decisions.
Portfolio changes
The Board receives regular updates on portfolio and corporate 
finance activities throughout the year, including regular updates on 
live transactions (disposals, acquisitions and corporate joint venture 
activity) and outputs of periodic portfolio reviews. These updates can 
take the form of presenting key summaries of information in Board 
packs, or oral updates on key matters. These discussions are typically 
led by executive and divisional management, supported by the 
Corporate Development team and, where necessary, external 
advisers. Subsequently, once portfolio transactions have closed, the 
Board is also kept informed of the integration or transition progress, 
including post-acquisition reviews conducted to assess transaction 
success and any learnings to be taken for future projects. In 2022, 
such portfolio updates included the significant acquisitions of Credly, 
and Mondly (which you can read more about on page 69) and, 
subject to closing, PDRI, as well as a review of potential pipeline 
opportunities and the disposal, across several transactions, of our 
international courseware local publishing businesses.
Board meetings 
The Board held six scheduled meetings in 2022, with discussions and 
debates focusing on the ongoing implementation and execution of 
the strategy, as well as other key strategic issues facing the company. 
Major items covered by the Board in 2022 are shown in the table on 
page 63. In addition to its scheduled meetings, the Board convenes 
as necessary to consider matters of a time-sensitive nature. In 2022, 
the Board also met on a number of additional occasions to consider 
the unsolicited approaches by Apollo Global Management. The Board 
welcomed the opportunity in 2022 to return to a fuller schedule of 
in-person meetings but, following its experiences during the 
pandemic, also continued to operate effectively in a virtual 
environment where needed.
Reflecting on the level and quality of engagement by the Board in 
2022, the Board is satisfied that each Director contributed to Board 
discussions and demonstrated sufficient commitment to be able to 
meet their responsibilities. As shown in the table below, each of the 
Non-Executive Directors attended all scheduled Board meetings 
during 2022. In addition, the Nomination & Governance Committee 
confirmed in its annual assessment that each Director demonstrates 
the requisite level of commitment and contribution in accordance 
with Principle H and Provision 18 of the Code.
Board attendance
Directors are expected to attend all Board and Committee meetings, 
but in certain exceptional circumstances, such as pre-existing 
business or personal commitments, it is recognised that Directors 
may be unable to attend. In these circumstances, the Directors 
receive relevant papers and, where possible, will communicate any 
comments and observations in advance of the meeting for raising as 
appropriate during the meeting. They are updated on any 
developments after the meeting by the Chair of the Board or 
Committee, as appropriate.
Individuals’ attendance at Board and Committee meetings is 
considered as part of the formal review of their performance. There 
was a high level of attendance by the Directors at Board and 
Committee meetings in 2022, as shown in the table to the right and 
in the Committee reports that follow.
Scheduled meetings attended
Chair
Omid Kordestani1
4/4
Sidney Taurel2
3/3
Executive Directors
Andy Bird 
6/6
Sally Johnson
6/6
Non-Executive Directors
Sherry Coutu
6/6
Esther Lee3
5/5
Linda Lorimer
6/6
Graeme Pitkethly
6/6
Tim Score
6/6
Annette Thomas
6/6
Lincoln Wallen
6/6
1. Omid Kordestani joined the Board as a Non-Executive Director on 1 March 2022 
and became the Chair on 29 April 2022.
2. Sidney Taurel resigned from the Board on 29 April 2022.
3. Esther Lee joined the Board on 1 February 2022.
Board activities continued
64 Pearson plc Annual report and accounts 2022
How the Board is kept informed
Talent and culture
Ensuring that we have both a talented, engaged workforce that  
is focused on delivering our strategy and an inclusive organisational 
culture that enables and encourages that delivery, is critical to 
Pearson’s success. During the past year, the Board and executive 
team have led our focus on making sure Pearson offers a culture and 
environment that is inclusive and high-performing, and in which our 
people can leverage their strengths. We track Group-wide progress 
by our ‘Culture of engagement and inclusion’ non-financial KPI (see 
page 18 for more details on our KPIs).
In early 2022, Pearson launched its new purpose, vision, mission and 
values (set out on page 2), and the Board was instrumental in their 
development. The adoption of our new values by our employees  
is a key step in developing our culture to support our strategic vision, 
particularly in driving a culture of performance. Our 2022 ‘People  
of Pearson’ campaign featured diverse employees throughout  
our global workforce, showing how they bring our culture and  
values to life. 
Recognising the global need for learning, relearning and upskilling at 
the heart of our business, our Learning at Work programme provides 
an all-employee opportunity to build a more inclusive learning culture 
across Pearson, alongside a continued drive for high performance. 
This programme is built around Pearson’s capabilities framework, 
which the Board and Executive team believe closely matches the 
knowledge, skills, mindset and experiences that will enable our 
people to drive Pearson’s evolution. Recent modules include 
engagement, being customer- and consumer-driven, and strategy, 
planning and value.
The Board monitors culture and organisational health together with 
its Committees, and receives regular updates from the Chief 
Executive and Chief Human Resources Officer. In addition to tracking 
culture as a non-financial KPI, the Board monitors other Group-wide 
initiatives that underpin our culture (see table below for examples).
During 2022, the Reputation & Responsibility Committee expanded 
its remit to include oversight of culture and employee engagement, 
increasing the Board-level focus on these matters. The Chief Human 
Resources Officer is a frequent attendee at Board meetings, as well 
as a standing attendee at the Reputation & Responsibility, 
Remuneration, and Nomination & Governance Committees. Her 
attendance and contributions, together with the Board’s own direct 
engagement with the workforce, ensure that our Directors are 
attuned to our culture and employee-related considerations through 
multiple lenses, including in strategic decision-making (see our case 
study on page 69), and in conducting their business more broadly.
During the year, the Board and Reputation & Responsibility 
Committee considered reflections and insights from the Chief 
Human Resources Officer following her first few months post 
appointment. Focus areas included cultural themes and principles 
that will underpin successful navigation of Pearson’s next phase, and 
attributes that are proven to predict performance, accelerate growth 
and increase the velocity of innovation – key to instil and hone 
throughout the company. The Board also has a particular focus on 
the current and future leaders of Pearson, including our talent 
pipeline for leadership and other pivotal roles, and we conducted our 
annual deep dive into talent and succession planning in December 
2022. Read more on page 75.
Read more about how we empower our people to make a difference 
on page 33.
The application of our Board and governance processes ensures that our Directors receive 
accurate, timely and clear information from a range of sources. This allows the Board and 
Committees to monitor and provide feedback on matters of importance, as well as to make 
informed decisions in the best interests of the company and its stakeholders.
Cultural indicator
How it is overseen
Board level 
responsibility
Employee 
engagement 
The Board ensures engagement through multiple channels, including the new Pearson Engagement Survey in 
2022 (the results of which were discussed by the Reputation & Responsibility Committee), our Employee 
Engagement Network (EEN), and town hall sessions. Read more on page 68.
 RR
EEN
Code of conduct 
and training
The Audit Committee is briefed on our annual Code of Conduct programme, including development of the 
code, completion rates, training and certification methods. Certification of the code is mandatory and we 
achieved a 100% employee completion rate in 2022. We also have mandatory training for all employees on 
cyber security and data privacy, and targeted training for employees in certain roles, divisions or geographies.
A
Compliance, 
including 
whistleblowing 
and investigations
The Chief Compliance Officer reports to the Audit Committee at every meeting on new and ongoing 
investigations, including matters raised through our SpeakUp process. The Audit Committee considers the 
programme’s effectiveness annually, including peer benchmarking. The Audit Committee Chair ensures the 
Board has visibility of matters of note. The Board is free to request further information to support its oversight.
A
Internal audit
Insights into elements impacting our culture and cultural behaviours are provided where necessary by internal 
audit to the Audit Committee as part of the findings and recommendations in its reports.
A
Health and safety 
(‘H&S’) 
The Reputation & Responsibility Committee receives an annual H&S report, so Directors can monitor the key 
strands of our H&S framework, including: oversight of how Pearson is enabled through awareness, 
competency, resources and guidance to allow for agile and effective management of H&S risk, while also 
receiving comfort that we have controls for compliance and assurance purposes.
RR
Remuneration 
practices and 
rewarding the 
workforce
The Remuneration Committee monitors the wider Employee Reward framework, including incentive target 
setting for group plans, fair pay analysis, Chief Executive pay ratios and alignment of Directors’ pension 
contribution to the workforce. It also oversees integration of ESG measures into incentive targets. This suite  
of activity provides insights into the roles that remuneration and setting performance goals play in promoting 
the right behaviours, particularly in driving a culture of performance, and how incentives and rewards align 
with culture. 
R
Talent attraction 
and retention
The Chief Human Resources Officer regularly updates the Remuneration Committee on talent considerations, 
including trends on recruitment, retention and staff turnover. Talent attraction and retention plays into our 
ability to execute our strategy, so it is considered in strategic discussions by the Board and executive team. 
Recognising the importance of our people, Talent is a sub-category of our principal risk, Capability. Read more 
about our risk management approach starting on page 43. 
R
The Board has a strong interest in all areas relating to Pearson’s talent and culture, and may choose to spend additional time considering the cultural indicators shown in the table, and 
others, over and above the input provided by our Committees.
Annual report and accounts 2022 Pearson plc 65

Sustainability
Pearson has a strong governance structure through which the Board and its Committees monitor and oversee the company’s ESG framework. 
The company’s ESG framework includes three pillars: driving learning for everyone with our products, empowering our people to make a difference, 
and leading responsibly for a better planet. These pillars represent the areas where Pearson can make the biggest positive impact and where our 
responsibilities lie towards society and the environment. 
The Reputation and Responsibility Committee (RRC) leads the Board’s 
oversight of ESG matters. 
Given the breadth of topics that feed into our sustainable business 
pillars, as well as the fast moving and increasingly complex external 
landscape around these matters, a review was undertaken in 2022 to 
ensure the Board’s overall governance framework for ESG remained 
fit for purpose. In particular, the following steps were undertaken:
 
— we revised the terms of reference of the RRC to reflect Pearson’s 
sustainable business strategy and to acknowledge the RRC’s role 
with respect to the requirements of the external ESG landscape
 
— we formally included employee engagement matters in the RRC’s 
remit, alongside culture, with a particular emphasis on diversity 
and high-performance
 
— we further codified the ESG duties of the other Committees,  
such as the Audit Committee’s role in overseeing the  
integrity and assurance of ESG data, reporting and metrics,  
and the Remuneration Committee’s considerations around 
incorporation of, and performance against, ESG metrics  
in remuneration decisions
 
— in order to support alignment in approach and information 
sharing across all Committees, Annette Thomas, Non-Executive 
Director, was appointed to the Remuneration Committee, in 
addition to her existing membership of the RRC and Nomination 
& Governance Committee
 
— we held a dedicated session for the Remuneration Committee on 
the topic of Pearson’s sustainability strategy, to ensure that it was 
fully apprised of key matters in this space as it began work on the 
new Directors’ remuneration policy. The session was led by the 
Chief Legal Officer and VP – Sustainability, with the Chair of the 
RRC, Linda Lorimer, also in attendance.
The graphic above illustrates how the Committees work together to 
support the Board in overseeing sustainability at Pearson.
In addition to the specific actions noted above, during the year the 
Board and its Committees discussed and monitored a variety of 
other topics pertinent to Pearson’s sustainable business strategy. 
These included:
 
— monitoring the performance of Pearson+ and considering the 
next steps for its expansion, in support of our aims to extend our 
digital content offering, reach and accessibility
 
— continued oversight of data privacy and cyber security matters by 
the Audit Committee. This included monitoring management’s 
implementation of actions that were recommended as part of a 
review of Pearson’s privacy and security programme, 
commissioned by the Board in 2021
 
— discussion and endorsement of talent, culture and employee 
engagement initiatives, as set out on pages 65-68.
You can read more on the sustainability matters covered during 2022 
throughout this Governance Report, in particular in the RRC’s report 
on pages 78-79.
The Board’s ESG governance structure
Indicative ESG duties falling within remits of Board Committees
Board
Reputation &
Responsibility
Committee
Audit Committee
 
— Overseeing 
sustainability strategy
 
— Overseeing matters 
relating to non-financial 
KPIs through the 
products, people and 
planet pillars
 
— ESG regulatory 
landscape and  
external reporting
Remuneration
Committee
Nomination &
Governance
Committee
 
— Integrity and assurance 
of ESG data, reporting 
and metrics
 
— Strategic risk 
management
 
— Compliance elements  
of ‘governance’ strand  
of ESG
 
— Considerations relating 
to incorporation of ESG 
metrics within 
remuneration 
frameworks
 
— Performance against 
ESG metrics to support 
remuneration decisions
 
— Ensuring requisite 
strength of ESG 
expertise on Board
 
— Corporate governance 
elements of ESG
How the Board is kept informed continued
66 Pearson plc Annual report and accounts 2022
Understanding our stakeholders
Engagement in 2022
Throughout the year, the Board ensured that it was kept informed of 
stakeholder views, concerns, and commentary, through engagement, 
both direct and indirect, physical and virtual. This engagement took 
place through a variety of ways, including in-person and virtual 
meetings, reports and presentations at Board or Committee 
meetings, feedback from members of the executive management 
team and other employee groups, and interactions with different 
functions, teams and advisers, both inside and outside Pearson. The 
use of digital technology allowed for broader engagement, helping to 
ensure that stakeholders retained a voice within the Boardroom.
A key factor in any decision-making is listening to and considering the 
interests of stakeholders. We have set out below examples of the key 
employee and shareholder engagement activities undertaken by the 
Board and by individual Directors over 2022. A detailed review of our 
acquisition of Mondly, and how it relates to our stakeholders and 
Pearson’s long-term success, is on page 69. 
As required by the UK Corporate Governance Code, the Board 
ensures Pearson engages effectively with, and encourages 
participation from, its key stakeholders. The Board maintains its 
oversight through a variety of direct and indirect mechanisms, 
and the Reputation & Responsibility Committee monitors our 
stakeholder engagement framework.
The Board recognises that stakeholder views are integral to 
decision-making and setting the company’s strategy. More 
information on Pearson’s key stakeholders, including the 
outcomes of our engagement throughout 2022, is in the 
strategic report on pages 26-29. Further information on how 
the Directors discharge their duties under Section 172 of the 
Companies Act 2006, is on page 29.
Shareholders
Shareholders are a key consideration in the Board’s decision-making. 
As the world emerged from the pandemic, we have once more 
focused on driving shareholder engagement through in-person 
meetings and events, while also using digital technology to reach a 
wider base of shareholders. 
The Board is committed to fostering shareholder engagement by 
making it easier for all types of shareholders to attend annual general 
meetings (AGMs), recognising that they represent an opportunity for 
shareholders to interact with the Board and share their views, 
concerns, and feedback. In 2022, we held our first hybrid AGM, with 
shareholders able to attend the meeting in person or virtually. The 
digital technology adopted by Pearson also allowed shareholders to 
vote and ask questions to the Board, both in-person and online. 
We believe that the hybrid approach enables a broader cross-section 
of our shareholders to participate in general meetings. Reflecting on 
the positive experience of our AGM arrangements in 2022, we will 
again be holding a hybrid AGM in 2023, and look forward to 
welcoming our shareholders. Further details will be shared in our 
notice of the 2023 AGM. 
The Board ensured a continued shareholder dialogue throughout 
the year. In accordance with the UK Corporate Governance Code, we 
engaged with shareholders following a significant minority vote 
against our Directors’ remuneration report at our 2022 AGM and 
reported back to the market on the major themes discussed. The 
Remuneration Committee completed a comprehensive review of 
Pearson’s executive remuneration framework ahead of the renewal 
of the Directors’ remuneration policy at the 2023 AGM, in line with 
the normal three-year cycle in the UK. As part of this process, the 
Committee engaged extensively with many of its larger shareholders 
and proxy agencies, and held virtual or in-person meetings with a 
significant proportion of those it approached. Further information on 
the Directors’ remuneration policy, and shareholder engagement 
after our 2022 AGM, is on pages 88-91. 
A strong understanding of all our stakeholders and their perspectives 
is integral to our strategic planning and operational delivery. Our 
Board strategy sessions are informed by the views and needs of our 
eight stakeholder groups: consumers, educational institutions and 
educators, employers, business partners and institutions, government 
and regulators, employees, shareholders, and our communities. 
Shareholder engagement at a glance
Over 2022, our Chief Executive, Chief Financial Officer and 
Divisional Presidents, as well our investor relations team, 
participated in meetings, conferences, roadshows and events 
across the world. This concluded with an intensive Q4 roadshow 
with outreach to over 350 investors and conference participation 
across the US, Europe and the UK.
Over
370
meetings
Over
190
institutions
with
Annual report and accounts 2022 Pearson plc 67

Understanding our stakeholders continued
Employees
The Reputation & Responsibility Committee leads on employee 
engagement and its evolution on behalf of the Board. The Board 
recognises that our employees are one of our most important assets 
and are integral to our business and is committed to strengthening 
their voice. Examples of how the Board engaged with employees in 
2022 to ensure that they are listened to, supported and rewarded, 
are illustrated below.
Employee Engagement Network
Our Employee Engagement Network (EEN) acted as a feedback 
mechanism, enabling the Board to hear directly from employees. 
Representing the voice of our employees, the EEN consisted of a 
selected group of active listeners, good communicators, and solid 
employee ambassadors across the company and in key geographies. 
These individuals included diverse genders, ethnicity groups, 
geographies, ages and tenures.
In 2022, the EEN welcomed Annette Thomas as a regular attendee 
alongside Sherry Coutu, increasing Non-Executive Director 
participation in the EEN.
Between November 2021 and December 2022, our second cohort of 
EEN members held five meetings focused on innovation, systems 
and processes, reward and recognition, structure and change, and 
cross-collaboration. Each meeting was structured to ensure that any 
views or feedback on key topics raised by employees could be 
passed on to the Board in advance, allowing each Director to review 
employee input ahead of Board meetings and consider it in their 
decision-making. Following EEN meetings, the Board received an 
update on any discussions that had taken place, such as the 
network’s collective feedback and several themes that arose as part 
of their discussion about reward and recognition.
The Board was also supportive of executive management receiving 
regular feedback from the network. In many cases, this feedback 
helped reaffirm the case for action in areas that were already being 
improved, such as the simplification of staff onboarding and user 
experience of internal systems. With the support of the network, 
approval escalation for many routine requests has been removed, 
reducing an administrative barrier for employees and  
their managers. 
Looking ahead, the Board believes there is an opportunity to evolve 
its approach to employee engagement to ensure we continue to be 
inclusive, authentic and representative of our diverse employee base. 
The Board has endorsed a wider programme of engagement 
activities with employees to be rolled out in 2023, which will 
complement existing executive employee engagement and expand 
opportunities for direct engagement by Non-Executive Directors. This 
programme will include in-person, structured listening sessions, as 
well as informal site visits at Pearson locations and virtual events.
 
Town halls
Throughout 2022, the Chief Executive, Chief Financial Officer and  
the executive management team held town hall meetings, which 
Pearson employees were invited to attend. These discussions took 
place at significant points in the year, such as following key financial 
results announcements.
Surveys
In 2022, we launched a new approach to engagement, including our 
new Pearson engagement survey. We partnered with Gallup and 
used their Q12 survey questions and supporting resources. We 
collected actionable feedback at the manager level and benchmarked 
ourselves against 12 item areas proven to power engagement. We 
heard from over 14,000 employees - an increase in the overall 
response rate compared to previous engagement surveys. The 
Reputation and Responsibility Committee received a detailed update 
on the survey results, including additional insights on the culture of 
inclusion, coaching effectiveness, and upskilling, which were also 
discussed at Board level. Further information on the outcomes of the 
Pearson engagement survey is on page 33.
68 Pearson plc Annual report and accounts 2022
Our Board's decision-making in action
Acquisition of Mondly
This case study on our acquisition of Mondly, which was announced 
in April 2022, illustrates how the Directors considered the various 
aspects of their statutory duties in making the decisions related to 
the acquisition and its implications for stakeholders. This case study 
should be read in conjunction with the Directors’ duties statement on 
page 29.
Mondly offers consumers high-quality learning in English and 40 
other languages through its app, website, and its virtual reality and 
augmented reality products. It delivers language courses for personal 
and professional learning in a combination of more than 1,300 
language pairs alongside enterprise solutions and an award-winning 
app that helps children learn languages. 
Mondly was Pearson’s first major acquisition in the English Language 
Learning (ELL) division since the implementation of the new divisional 
structure, and is integral to its growth plans. The Board paid 
particular attention in its decision-making to assessing the strategic 
rationale, integration plans, and synergies to ensure these were 
robust, clear and achievable. The Board was of the view that Mondly’s 
technological capability and user experience, combined with the 
growing direct to consumer language learning market, could provide 
an engine for future growth of the ELL division based on a successful 
platform that was well-regarded in the market and had begun to 
scale while maintaining profitability. 
Alongside these considerations, the modularised, application-based 
nature of Mondly’s products had the potential to integrate with 
Pearson+. The Board understood that Mondly represented a 
potential avenue to link together ELL’s assessment capability and 
world-class content through a new channel, as well as noting 
potential synergies across the portfolio, such as offering the 
opportunity to bundle language learning with upskilling and reskilling 
products through Pearson’s Workforce Skills division. The Board was 
positive about how these potential synergies could play an important 
role in Pearson’s continued commitment to serve the lifelong 
learning needs of people around the world. 
When considering this acquisition, the Board received detailed 
updates from management (with input from specialists within the 
business and external advisers) setting out the strategic rationale, 
anticipated commercial synergies, due diligence findings, valuation 
and returns analysis, stakeholder considerations, structuring 
considerations, risks and detailed post-acquisition integration plans. 
The Board noted how the broader Pearson organisation could 
support Mondly in optimising its content for Pearson’s target 
audience of lifelong learners. This was balanced against key risks, 
such as the difficulty of profitably scaling a direct to consumer 
proposition and the cultural and operational challenges of post-
acquisition integration. Overall, the Board considered Mondly to be 
an attractive acquisition opportunity, underpinned by its 
management, the skills and transformational potential of the Mondly 
team, and strong market fundamentals. 
Throughout the decision-making process, the Board considered how 
the acquisition could accelerate the company’s strategy and how the 
expertise acquired as a result of the acquisition would benefit 
Pearson stakeholders, all while ensuring that the acquisition was 
financially viable. The Board was mindful that this acquisition could 
promote sustainable economic growth and inclusively support 
learners in their language learning journey. In its decision-making, the 
Board considered Pearson’s key stakeholders in the following ways.
Consumers
Our strong direct to consumer ambitions put consumers at the heart 
of our strategic decisions. Mondly’s mission is to build bridges 
between people and cultures by making language learning fun and 
easy through technological innovation. The ambition to bring people 
together sits at the core of Mondly’s work. Furthermore, it 
strengthens Pearson’s commitment to its purpose of adding life to a 
lifetime of learning, offering learners new experiences and powerful 
ways to immerse them in a new language, including, in the long term, 
through its AR and VR capabilities. As part of its decision-making, the 
Board noted the broader appeal of developing transferable skills, 
including foreign language fluency, which can boost employability 
and success in life.
Communities
Mondly presented the opportunity to reach learners of all languages 
across the world by providing a go-to solution for both adults and 
children. In the Board’s view, Pearson could play an important role in 
upscaling content by leveraging its existing capabilities, excellent 
content, and network of customers and consumers to enhance the 
Mondly offering. This could benefit learners at all stages of their 
language learning journey - from beginner to advanced - using 
different features to make learning fun, engaging and accessible for 
users from a wide spectrum of socioeconomic circumstances and 
backgrounds globally.
Employees
Pearson and Mondly’s communications and HR teams worked closely 
to form an acquisition communications plan for employees and 
customers. For example, Pearson employees heard directly from the 
Chief Executive about how Mondly aligned with the company’s 
strategy, particularly in the ELL space.
The Board viewed people and talent integration as crucial for this 
acquisition, noting that it was imperative to retain Mondly employees, 
and to maintain their customer-centric approach. In particular, the 
Board considered various initiatives to retain the skill set of Mondly 
employees, acknowledging that some of Pearson’s existing employee 
base might need to pivot their skill set and approach to support the 
speed and growth of Mondly and to develop into a multi language 
learning business.
Considering the relatively small size of its team, the Directors were 
also aware of minimising the strain of integration on Mondly. They 
were keen to ensure appropriate acquisition speed and to prepare 
for a multiyear gradual and disciplined approach to reach full 
integration of Mondly into Pearson, while also remaining mindful of 
Mondly’s obligations once part of the Pearson group. 
Employers
MondlyWORKS, the language learning solution for businesses offered 
by Mondly, provided the opportunity for Pearson to strengthen 
Mondly’s appeal by leveraging existing content and assessment 
solutions. The Directors also noted that Mondly’s solutions would be 
a strong addition to Pearson’s existing language learning products for 
corporate customers. The Board considered MondlyWORKS to be 
capable of offering commercial synergy opportunities that would 
benefit employers through sophisticated language learning content. 
Shareholders
In considering the acquisition, the Board paid particular attention to, 
among other factors, commercial and revenue synergies, integration 
and employee retention costs, the potential financial returns on 
investment and the risks involved, the structure of the transaction, 
and whether the commercial terms of the acquisition were in the 
interests of shareholders as a whole. The Directors agreed that the 
acquisition had the potential to be transformative for the ELL division 
and could gradually strengthen Pearson’s offering in the Workforce 
Skills area and Pearson+, highlighting the already strong returns 
profile of Mondly.
Annual report and accounts 2022 Pearson plc 69

On joining the Board, each Director completes a bespoke induction 
programme that is guided by the Chair or Deputy Chair and Senior 
Independent Director, supported by the Company Secretary, and 
overseen by the Nomination & Governance Committee. Every 
programme builds on the particular skill set, attributes, and 
background of the joining Director, their interests in Board or 
Committee roles, and the company’s recommendations. 
In addition to background information on the company, every 
induction covers a range of topics including Board procedures, 
recent operational performance and strategic direction of the 
company, purpose and values, key areas of the business, as well as 
Directors’ duties and responsibilities. The Directors also cover various 
governance-related issues and their legal obligations, including 
procedures for dealing in Pearson shares. 
Each induction typically includes a series of meetings with the 
members of the Board, the executive management team, external 
advisers and brokers, and other senior management. Directors 
receive a walk-through of the business from senior executives and a 
briefing on Pearson’s investor relations programme. A newly 
appointed Director will have met some, if not all, fellow Board 
members as part of the original search and appointment process, 
but additional meetings may nevertheless occur with the same Board 
members as part of a rich and thorough induction.
Inductions for Esther Lee and Omid Kordestani
Esther Lee joined the Board on 1 February 2022 and Omid 
Kordestani joined as a Non-Executive Director on 1 March 2022, 
subsequently becoming the Chair on 29 April 2022. As part of their 
onboarding programmes, Esther and Omid received comprehensive 
and engaging induction programmes that included a series of 
meetings, beginning before their joining the Board and running for 
several consecutive weeks. 
In addition to meeting the Chair, Chief Executive and Chief Financial 
Officer, Esther and Omid met with each of the executive 
management team members, key representatives of our corporate 
functions, and brokers. Both induction programmes also included 
one-to-one meetings with each of their fellow Non-Executive 
Directors and a comprehensive introduction to the activities of each 
of the Board’s Committees, including their objectives and priorities. 
Esther and Omid also held meetings with the company’s legal 
advisers to discuss directors’ duties, corporate governance and 
external reporting, among other topics.
Directors’ induction
Esther Lee
Appointed to the Board on 1 
February 2022
“I welcomed the 
opportunity to get to 
know other Directors  
in advance of my joining 
the Board and to 
subsequently meet the 
executive management. 
From governance matters 
to divisional deep-dives, 
my induction programme 
included everything 
necessary to understand 
the dynamics of the 
Board and how to 
effectively contribute  
to its discussions as a 
Non-Executive Director.”
Following the initial phases of her induction, Esther was keen  
to understand in greater detail our Workforce Skills division  
and reviewed its competitive landscape, acquisition strategy,  
market dynamics, and how each of these areas was linked to the 
strategic plan. The Nomination & Governance and Remuneration 
Committees, her planned contribution to which she discussed with 
their respective Chairs, were of particular importance to Esther. 
A meeting with the company’s external consultants on reward 
matters was subsequently arranged for Esther to learn more  
about the Remuneration Committee’s priority areas and the UK 
market landscape. 
As Chair Designate, Omid held regular meetings with the Chair, 
Deputy Chair Designate and Senior Independent Director, as well as 
the Chief Executive. Having met the executive management team in 
person and following his introductory meetings with the company’s 
advisers, Omid was also invited to join the meetings of each of the 
Board’s Committees. The table below illustrates the purpose of some 
of the meetings that formed part of Omid’s induction programme.
Induction programme participants
Meeting purpose
Chair, Deputy Chair Designate and 
Senior Independent Director
Introductory meetings to cover the company’s governance structure, the Board’s priority areas and ways of 
working, meeting cadence, and ongoing matters considered by the Board.
Chairs and members of the Board’s 
Committees
Overview of the responsibilities and composition of the Board’s Committees, their governance, regular 
attendees and advisers.
Executive Directors; 
Divisional Presidents 
Overview of the strategic priorities of the company and each division, key performance indicators, financial 
performance and projections, and competitive landscape.
Heads of Corporate Functions
Introductions with leadership team members, covering an overview of their business area(s), subject 
matter expertise, organisational structure, company culture and values.
Company Secretary; 
legal advisers
Induction planning, governance framework, Board and Committee matters, duties and responsibilities of a 
company director, the company’s policies and procedures, and other legal and regulatory considerations.
Directors’ training
All Directors receive training on topics of importance for the company. Following takeover approaches to the company from Apollo Global 
Management, the Directors received additional training on the application of The City Code on Takeovers and Mergers as well as their 
responsibilities under the Market Abuse Regulation.
70 Pearson plc Annual report and accounts 2022
Board evaluation
Following an externally led review in 2020 and an internally facilitated 
review in 2021, led by the Senior Independent Director, the 2022 
evaluation would normally have been questionnaire-based. However, 
given the recent appointment of Omid Kordestani as Chair in April 
2022, it was felt that it would be beneficial for a further internally 
facilitated evaluation to be conducted during 2022, which Mr 
Kordestani agreed to lead. 
Typical three-yearly evaluation cycle
Year
Methodology
Last 
undertaken
1
Questionnaire, tailored to specific needs  
of the business
2018
2
Internally facilitated interviews, to be led 
by the Chair, Senior Independent 
Director and/or Company Secretary as 
appropriate
2019, 
2021, 
2022
3
In-depth evaluation, externally 
facilitated
2020
Approach and methodology
The 2022 evaluation was carried out by Omid Kordestani, Chair, 
through a series of one-to-one conversations with each Director and 
anchored in a set of questions shared with Directors in advance. The 
one-to-ones were conducted in a ‘free-format’ style, to allow organic 
discussions and to provide ample opportunity for Directors to raise 
matters of importance. 
Discussion areas included matters that are relevant to Pearson in 
particular, as well as those items laid down in the Code and 
associated guidance, including:
 
— the effectiveness of the organisation and dynamics of the Board, 
including composition, competencies, diversity, leadership, 
agendas, meeting cadence, quality of information provided, 
governance and decision-making
 
— relationships between the Board and senior leaders, and 
between members of the Board itself, including the remits of and 
interaction among the respective Committees and with the Board
 
— succession planning and talent pipeline for Executive Directors 
and other senior leaders
 
— the company’s purpose and the Board’s monitoring of 
organisational culture, behaviours and employee sentiment
 
— articulation and implementation of strategy
 
— understanding of risks facing the company, including likelihood 
and mitigation
 
— understanding of stakeholder views, products and markets
 
— oversight of sustainability matters, including DE&I
 
— concerns and areas for improvement.
The Nomination & Governance Committee reviewed the findings 
from the evaluation together with the full Board at its meeting in 
December 2022. The Committee will develop an action plan to 
address areas for improvement and will monitor progress during  
the year.
In reporting back to the Board, the Chair noted that conversations 
with Board members were positive, there was much consistency in 
the feedback provided by individual Directors, and there was 
unanimous agreement that the Board operates effectively.
Key findings included:
 
— Directors are highly motivated and there is a strong diversity of 
talent on the Board, with the Board as a whole considered to be 
knowledgeable, respectful and fully engaged. 
 
— Board members have relevant skills and experience, albeit the 
Board recognised the importance of paying particular attention to 
its composition and skill sets in light of expected departures 
during 2023 and 2024 as certain Directors reach the end of their 
tenure and as the company’s strategy continues to evolve. The 
Board acknowledged the strength and variety of contributions 
made by all, including its longest serving Directors. 
 
— Board meetings and discussions are considered to be insightful, 
with valuable and constructive conversations. The Board is 
appreciative of the continued efforts by management to deliver 
focused, succinct meeting papers and materials.
 
— The Board recognised the progress that had been made on 
strategy, led by the Chief Executive and the refreshed executive 
team, including the new Chief Strategy Officer. The Board is 
appreciative of the in-depth conversations that have taken place 
on Pearson’s strategy and vision, with the important next step 
being to focus on execution.
 
— The Board appreciates both the openness and transparency of 
the Chief Executive and the access to, and engagement with, the 
executive management team.
 
— The Board is supportive of the evolution of the company towards 
a more performance-oriented culture and looks forward to 
updates from the Chief Human Resources Officer in this regard. 
 
— The Board recognised the work led by the Chief Legal Officer  
and her team in respect of Pearson’s sustainability strategies,  
with guidance and oversight from the Reputation  
& Responsibility Committee.
There was unanimous agreement that the Chair leads the Board in 
an effective manner, fulfilling Principle F of the Code. The Directors 
agreed that he demonstrates objective judgement, promotes a 
culture of openness and debate, and facilitates constructive Board 
relations and the effective contribution of all Non-Executive Directors. 
This, in turn, supports Non-Executive Directors in fulfilling the 
requirements of Principle H of the Code in providing constructive 
challenge and strategic guidance, offering specialist advice and 
holding management to account.
Board evaluation process
The format of the review was agreed by the Chair and 
Deputy Chair & Senior Independent Director (including in 
the latter’s capacity as Chair of the Nomination & 
Governance Committee).
The scope of the review was finalised by the Chair with 
support from the Company Secretary.
The Chair interviewed each of the Directors on a 
confidential and unattributable basis.
The output of the evaluation was captured in a report to 
the Board in December 2022, with the Board then 
discussing the points raised by the review.
Progress on the findings of the evaluation will be 
monitored by the Nomination & Governance Committee 
throughout 2023.
The Board operates a three-yearly evaluation cycle which employs a 
variety of methodologies to ensure the most effective results. 
Annual report and accounts 2022 Pearson plc 71

Board evaluation continued
The main areas identified by the Board for particular focus during 
2023 were:
 
— Continued focus on execution of strategy, including clarity on how 
the Board can best monitor and measure the execution plan 
while maintaining its distance from operational matters.  
In particular, the Board identified the importance of ensuring 
accountability for execution in the next phase of the  
company’s transformation.
 
— Continued sharing of customer and marketplace insights with  
the Board, which is seen as particularly important at this time as 
Pearson evolves on multiple fronts.
 
— Ongoing focus on succession planning and talent review, both  
at Board and executive level as well as more broadly, to ensure 
Pearson has both the right skill set to deliver on its strategic vision 
and a strong pipeline of talent to allow continued execution in  
the future.
 
— A desire to identify and focus on the elements of sustainability 
that are particularly relevant and critical for Pearson’s success.
 
— As Pearson continues to grow in the direct to consumer space,  
an ongoing focus on the importance of the risks inherent in the 
technology, cyber and online spaces, including information 
security, safeguarding and reputation.
 
— Following a period of significant acquisition activity, a desire for  
the Board to focus on post-acquisition integration and evaluation 
of the performance of acquired businesses.
 
— Ongoing development of the Board’s roadmap for market visits 
and deep dives to ensure this is aligned with Pearson’s aspirations 
and international footprint.
In addition to the annual evaluation exercise, the Chair meets 
regularly with the Non-Executive Directors and these sessions 
include reciprocal feedback on the functioning of the Board.
Progress on findings of previous evaluation
A number of actions were taken during the year in response to findings from the 2021 Board evaluation process, as set out below. The Board has 
confirmed that these items were addressed to its satisfaction, with recommendations having been put into practice or a clear action plan identified for 
each to be taken forward in 2023.
Finding or focus area
Response or action taken
Continued focus on execution of strategy in each 
of Pearson’s five divisions, including clarity on how 
the divisions work together and continued 
optimisation of the more established businesses.
The Board has considered divisional execution plans as part of its strategy discussions 
throughout the past year. Inter-divisional synergies also continued to be assessed and 
discussed, including as part of considering acquisition opportunities. Optimisation of 
established businesses was also a consideration in the Board’s strategic execution 
discussions: e.g. the agreement to acquire PDRI, announced in December 2022 and 
subject to completion in 2023, which augments Pearson’s offering to enterprises and US 
federal job seekers.
Additionally, the Audit Committee has discussed key strategic risks with the Presidents of 
each of Pearson’s five divisions over the past year as part of a suite of strategic risk deep 
dives. Read more about the work of the Audit Committee on page 80.
Continued discussions on portfolio, investment 
prioritisation, capital allocation and other  
corporate finance matters, in support of delivery  
of the strategy.
The Board discussed these topics on a regular basis, with input from divisional leadership 
and Pearson’s strategy and corporate development teams, resulting in a number of 
changes to the portfolio as described elsewhere in this report, including Pearson’s 
acquisition of Mondly (read more about this acquisition on page 69). The Board also 
determined to undertake a £350m share buyback programme to return capital to 
shareholders, which was completed in December 2022 (see page 120).
Involvement in the selection of KPIs, with the Board 
having visibility of supporting data to allow 
evaluation of relevant metrics.
Strategic KPIs were agreed by the Board in early 2022 and incorporated into the Board’s 
regular milestone and dashboard report to allow ongoing oversight and evaluation. The 
Board has subsequently discussed with management the metrics and definitions 
underpinning certain KPIs and the ways in which these are communicated to stakeholders.
Continued sharing of customer insights with the 
Board to aid understanding of the quality of 
product, content and services.
Customer feedback was shared with the Board as part of briefing sessions on 
developments to the Pearson+ offering. Customer and competitor insights remain an  
area of particular interest for the Board in 2023. The Reputation & Responsibility 
Committee also considered the sentiment of different consumer audiences towards  
the Pearson brand.
Individual evaluation
In addition to the evaluation of the Board as a whole, Executive 
Directors are evaluated each year on their overall performance 
against goals agreed by the Board, and in respect of strategic 
measures under the company’s annual incentive plan. These goals 
are linked to the key financial and strategic objectives of the 
company. Progress against each of these metrics is reviewed by the 
Board on a regular basis, as part of a dashboard of KPIs.
Following his appointment as Chair, Mr Kordestani intends to lead a 
formal individual evaluation of each Non-Executive Director every 
other year, similar to the practice adopted by the previous Chair, 
Sidney Taurel, and he encourages open channels of communication 
with Directors on an ongoing basis. In the Board’s opinion, these 
ongoing lines of communication, combined with a Group-wide 
culture which allows and encourages feedback at any time, provide 
the most effective means for evaluation. In assessing the contribution 
of each Non-Executive Director, the Chair, with the support of the 
Nomination & Governance Committee, has confirmed that each 
continues to make a significant contribution to the business and 
deliberations of the Board. The Non-Executive Directors, led by the 
Deputy Chair & Senior Independent Director, Tim Score, also conduct 
an annual review of the Chair’s performance, with Mr Score providing 
feedback from this review to the Chair.
Committee evaluation
All Committees undertake an annual evaluation process to review 
their performance and effectiveness. For 2022, the Committee 
evaluation process was facilitated internally by the Secretary of each 
Committee through use of a tailored questionnaire, except for the 
Nomination & Governance Committee, the evaluation of which 
formed part of the broader Board evaluation process. The findings 
from the Committee evaluation process were considered at the next 
applicable meeting. Read more in the Committee reports on the 
pages that follow.
72 Pearson plc Annual report and accounts 2022
Finding or focus area
Response or action taken
Ongoing focus on succession planning and talent 
management, at both senior levels and more 
broadly, to ensure Pearson has the right skill set to 
execute its strategy.
Ali Bebo was appointed as Chief Human Resources Officer in late 2021 and worked with 
management throughout 2022 in relation to the organisational design, particularly at 
senior levels, and talent management. This was discussed in detail by the Board at its 
meeting in December 2022. 
New appointments at both Board and Executive level in 2022, as described elsewhere in 
this report, have brought valuable additional skills and experience to the company’s 
leadership team. Read more about the Executive Management team on page 60.
Refinement of long-range planning in light of the 
new strategy and business structure.
Following the appointment of new Chief Strategy Officer, Sulaekha (Sue) Kolloru Barger, in 
May 2022, the Board has continued its oversight of substantial strategic planning and 
initiatives. In particular, work has been undertaken to refine Pearson’s strategic planning 
cadence in alignment with the annual budget cycle.
Ensure work to refresh the risk management 
framework continues, particularly given the 
increasing importance of information security, data 
management and privacy, and cyber risks.
Divisional strategic risk deep dives at the Audit Committee have been well received by 
Directors and are proving beneficial for management in developing new ways of thinking 
about risk.
Cyber and data-related risks continue to be key topics arising across the work of the Audit 
Committee, and the addition of the Chief Information Officer as a regular Audit Committee 
meeting attendee will enhance oversight and monitoring of these areas.
Read more about our approach to risk on page 43 and the work of the Audit Committee on 
page 80.
Continue to evolve ways of monitoring the culture 
and behaviours throughout the organisation, as 
well as overseeing the implementation of 
Pearson’s new purpose, mission, vision and values.
The Board recognises the progress made by the Chief Human Resources Officer in helping 
to drive a company-wide focus on engagement and development of a performance culture. 
This has included a new approach to measuring employee engagement, relaunch of a 
Learning at Work programme, and the successful roll-out of Pearson’s new purpose, 
mission, vision and values. The Reputation & Responsibility Committee will lead oversight of 
culture and employee engagement following revisions to its terms of reference in late 
2022, further aiding the Board’s oversight of these matters.
The Board is mindful that it is particularly important to pay close attention to culture and 
engagement throughout the year, particularly following a period of strategic and 
operational transformation. It will, therefore, be attentive to these matters in 2023.
Read more about culture and employee engagement on pages 65-68.
Annual report and accounts 2022 Pearson plc 73

Nomination & Governance Committee report
Role and composition of the Committee 
I am pleased to present my first report as Chair of the Nomination & 
Governance Committee, having been appointed to the position in 
April 2022 following the retirement of Sidney Taurel, Board Chair. I 
offer my thanks to Sidney for his substantial contributions to the 
Committee’s work, most particularly in ensuring we have a strong and 
diverse Board in place to lead our company. 
The Committee monitors the composition and balance of the Board 
and of its Committees, identifying and recommending to the Board 
the appointment of new Directors and/or Committee members. The 
Committee has oversight of the company’s compliance with, and 
approach to, all applicable regulation and guidance related to 
corporate governance matters. The Committee is also available to 
support the Board as needed in relation to talent and succession 
plans for senior roles.
The Committee currently has five members including me as Chair, 
with Omid Kordestani and Esther Lee having joined the Committee 
following their appointments to the Board in early 2022. The Chief 
Executive and other senior management, including the Chief Human 
Resources Officer, attend Committee meetings by invitation. 
As Committee Chair, I am available to engage with any shareholders 
who would like to discuss the work of the Committee and look 
forward to taking any shareholder questions at our forthcoming AGM 
in April 2023.
Board succession planning, skills and expertise
A key element of the Committee’s remit is to lead the process for 
Board appointments in line with appropriate succession plans. The 
company has contingency plans in place for the temporary absence 
of the Chief Executive for health or other reasons. The matter of 
Chief Executive succession is a regular item for discussion and review 
by the Board on an annual basis. Succession planning for the Board 
as a whole is considered at least annually by the full Board, and on an 
ongoing basis by the Committee.
The Committee has defined a set of specific criteria for potential new 
Non-Executive Directors, in particular giving consideration to the 
skills, experience and knowledge required in any candidates. Pearson 
expects all Non-Executive Directors to demonstrate the highest level 
of integrity and credibility, independence of judgement, maturity, 
collegiality and also a commitment to devote the necessary time to 
the company’s business.
As part of the Committee’s regular succession planning activity, all 
Board members are asked periodically to complete a self-assessment 
of the skills and experience which they believe they each bring to the 
Board. The assessment focuses on those categories of skills and 
experience which are relevant to Pearson’s strategy, business model 
and particular organisational characteristics. When mapped against 
expected retirement dates, the assessment helps the Committee to 
identify the areas where it may need to focus any future search 
activity. The results of the most recent assessment (shown opposite) 
demonstrate that Pearson currently has a strong spread of skills 
across all areas identified as being of particular importance. 
Having regard to the upcoming retirement of Ms Lorimer from the 
Board at the 2023 AGM, as well as looking further ahead to 
anticipated Board retirements over the next two to three years, the 
Committee agreed to commence a Non-Executive Director search 
process in the latter part of 2022. In preparing for this search, the 
Committee agreed that it was particularly interested to identify 
candidates who would collectively bring a combination of skills and 
expertise in the following areas:
 
— operating experience with subscription and/or enterprise SaaS 
business models, at a scale and complexity commensurate  
to Pearson
 
— experience developing innovative digital products and/or driving 
digital business transformation
 
— an active senior finance leader, with a deep understanding of 
public company governance standards, ideally from a UK listed or 
global business
 
— capacity to serve on the Audit Committee.
Principal Committee responsibilities
Appointments
Identifying and nominating candidates for Board vacancies. 
Balance
Ensuring that the Board and its Committees have the 
appropriate balance of skills, experience, independence, 
diversity and knowledge to operate effectively.
Succession
Reviewing the company’s leadership needs with a view to 
ensuring the continued ability of the organisation to compete 
in the marketplace.
Governance
Reviewing and overseeing Pearson’s corporate governance 
framework, Board evaluation and training plans, and the Board 
Diversity Policy.
Terms of reference
The Committee has written terms of reference which clearly  
set out its authority and duties. These are reviewed annually  
and can be found in the Governance section of our website  
(www.pearsonplc.com).
Committee members and attendance 
Attendance by Directors at scheduled Nomination & Governance 
Committee meetings throughout 2022:
Committee members
Meetings attended
Sherry Coutu
3/3
Omid Kordestani1
2/2
Esther Lee2
2/2
Tim Score
3/3
Sidney Taurel3
1/1
Annette Thomas
3/3
1. Mr Kordestani was appointed to the Committee on 1 April 2022.
2. Ms Lee was appointed to the Committee on 1 April 2022.
3. Mr Taurel resigned from the Board and the Committee on 29 April 2022.
Tim Score - Committee Chair
74 Pearson plc Annual report and accounts 2022
Taking into account the agreed person specification, the Committee 
has engaged Spencer Stuart to undertake a search process for new 
Non-Executive Directors. In line with the objectives of the Board’s 
Diversity Policy, the Committee has asked Spencer Stuart to ensure 
that the list of candidates reflects diversity of gender, ethnicity, 
geography and age as well as diversity in its broadest sense. You can 
read more about the Board Diversity Policy and diversity across 
Pearson on page 76. In addition to the Non-Executive Director search 
process, Spencer Stuart also undertakes broader executive search 
activity for the Group and is a signatory to the Voluntary Code of 
Conduct for Executive Search Firms. Spencer Stuart has no 
connection with Pearson or members of the Board beyond its 
expertise in board and executive search.
Executive succession planning
Succession planning for key positions at executive management level 
is primarily overseen by the full Board, with support provided by the 
Committee in respect of particular initiatives. The executive team has 
a key role to play in our strategic planning process, in the ongoing 
development of our talent pipeline and in fostering the culture and 
values required to continue to deliver on our strategy. In December 
2022, the Board held a discussion on talent, including a succession 
planning session focused on the executive pipeline from which the 
future leaders of Pearson were likely to emerge, both at Pearson 
Executive Management level and for other key roles. A diverse 
pipeline of ‘ready now’ and ‘ready later’ emerging talent has been 
identified, and plans are in place to accelerate these individuals’ 
development and path to succession where possible. These 
measures include inviting individuals to participate in Board and 
Committee meetings, mentoring by Non-Executive Directors, and 
encouraging and enabling individuals to take on external non-
executive roles in order to increase their exposure to new areas  
of business. The company also has targeted development 
programmes for high-potential talent and mentorship programmes 
for diverse leaders, as well as development programmes for junior 
and middle management.
Other areas of focus during 2022
The Committee oversees the company’s compliance with the UK 
Corporate Governance Code and reviews a status tracker to enable it 
to consider the appropriateness and maturity of various elements of 
our governance framework and to monitor any areas of qualified or 
non-compliance. Learn more about Pearson’s compliance with the 
Code on page 55.
Other areas of focus for the Committee during the year included: 
oversight of composition of the Board’s Committees, assessment of 
the independence of Linda Lorimer prior to making a 
recommendation for her re-election at the 2022 AGM (recognising 
her length of service on the Board), and the annual review of the 
contribution of each Director to the Board. As Committee Chair and 
Deputy Chair of the Board, I also paid particular attention to the 
onboarding and induction of Omid Kordestani as the new Board 
Chair. You can read more about the induction process for both Omid 
Kordestani and the recently appointed Non-Executive Director Esther 
Lee on page 70.
Committee evaluation
The Committee undertakes an annual evaluation process to review 
its performance and effectiveness. For 2022, feedback relating  
to the Committee was sought from Directors as part of the wider 
Board evaluation led by the Board Chair. Topics covered included  
the effectiveness and dynamics of the Committee, oversight of  
key areas within the Committee’s remit, the quality of papers and 
meeting discussions, and the relationships between the Committee 
and management.
The findings of the effectiveness review process for 2022  
indicated that the Committee is considered to be working well  
with appropriate agendas, papers produced to a good standard  
and high-quality discussions.
Committee aims for 2023
The Committee’s priorities for the coming year will be to lead  
and conclude the current Non-Executive Director search process, 
and to oversee the planned externally-facilitated Board evaluation 
process. Additionally, together with our colleagues on the Audit 
Committee, we will monitor any proposals by the regulator to revise 
the UK Corporate Governance Code in light of the UK Government’s 
response to the consultation on Restoring Trust in Audit and 
Corporate Governance, and will oversee management’s response  
to this.
Tim Score
Chair of Nomination & Governance Committee
Skills matrix
This matrix represents the number of Directors with core or supplemental capability in areas that are relevant to Pearson’s strategy, business model 
and organisational characteristics. A core capability is one of the strongest areas of a Director’s skill and expertise, where they bring considerable value 
to Board discussions. A supplemental capability is an area where the Director is competent or has experience, but is not one of the primary skills or 
attributes that they bring to the Pearson Board.
Category
 Core capability  
 Supplemental capability
1. Accounting and finance 
2. Data and cyber security 
governance
3. Digital and technology 
4. Disruption management, 
including: Talent 
leadership through 
change, Marketing and 
data insights, New 
business models and 
innovation
5. Direct to consumer 
business models 
(including consumer 
brand and marketing)
6. Education and public 
sector 
7. Global markets 
8. People/general talent 
focus, including workforce 
learning 
9. Policy and government 
relations 
10. Prior CEO experience, 
particularly of 
multinational businesses 
11. Remuneration 
12. Scale and complexity 
13. Sustainability 
14. UK plc governance
1
2
3
4
5
6
7
8
9
10
11
12
13
14
3
6
6
6
3
3
3
6
1
9
4
5
8
6
4
8
8
1
4
4
10
2
2
6
5
4
4
Annual report and accounts 2022 Pearson plc 75

We have been on an intentional journey to redefine what diversity, 
equity, and inclusion (DE&I) mean at Pearson and to take action. We 
have reshaped our policies, practices, and principles around DE&I 
and created a long-term strategy focusing on recruitment and 
promotion, retention, inclusive culture, and social impact.
Our ambition is to be an inclusive and high performing place to work 
where everyone can leverage their unique strengths. That’s why our 
updated people strategy has DE&I as one of our three pillars with the 
aim of creating a culture of belonging and increasing diverse 
representation throughout the company. As part of our new Pearson 
engagement survey, we have a culture of inclusion index to 
benchmark and measure against three principles: employees are 
treated with respect, managers value employees for their strengths, 
and our leaders do what is right.
In addition, Pearson’s Code of Conduct in relation to ethical practices 
takes account of gender, age, race, ethnicity, disability, and sexual 
orientation, and applies to all employee levels, including the executive 
management team. It is underpinned by a global statement on DE&I, 
along with country and business-specific policies. Standards are set 
consistently worldwide – both internally and externally – as part of 
our efforts to make Pearson a great place to work. 
Together, our goal is to drive the transformation of learning,  
making it more diverse, equitable, and inclusive. It is a continuous 
combination of intentional bottom-up and top-down leadership 
across all levels of the company to foster a culture where everyone 
feels a sense of belonging. 
Board diversity 
We believe that Board diversity makes us a better and more 
sustainable business, contributing to high performance, enhanced 
commercial results, and an inclusive leadership culture. Research 
indicates that high-performing boards provide an increased 
competitive advantage and wider perspectives, while the needs for 
greater inclusion and diversity continue to influence global trends. 
We are determined that, as a Board, we must be representative of 
our employee base and wider society, including the countries in 
which we operate. The Board embraces the Code’s underlying 
principles with regard to Board balance and diversity, including in 
respect of ethnicity, gender and age. The objectives set out in the 
Board’s Diversity Policy and our progress towards these are shown in 
the table on page 77. 
The Nomination & Governance Committee ensures that the 
Directors of Pearson demonstrate a broad balance of skills, 
background and experience, to support our strategic development 
and reflect the global nature of our business. It requires 
appointments to be made on merit and relevant experience, while 
taking into account the broadest definition of diversity. In any 
Non-Executive Director search processes, the Nomination & 
Governance Committee encourages the retained search firms to 
place an emphasis on putting forward candidates who would 
enhance the overall diversity of the Board. 
In light of the changes put forward by the Financial Conduct Authority 
(FCA), the Nomination & Governance Committee has updated the 
objectives that support the Board Diversity and Inclusion Policy, and 
which underpin Pearson’s commitment to creating a more equitable 
and inclusive company. The current objectives are set out below: 
 
— at least 40% female directors 
 
— at least two directors from an ethnic minority background 
 
— at least one of the Chair, Chief Executive, Deputy Chair and Senior 
Independent Director or CFO is a woman
We have also expanded our objectives to confirm that the Board will 
consider its own diversity, and that of its Committees, as part of the 
annual effectiveness review processes. Further, the Board will 
explore expanding its diversity considerations to include 
characteristics such as sexual orientation, disability and socio-
economic background. 
The Nomination & Governance Committee has confirmed that it will 
adopt a principles-based approach to diversity on the Board’s 
Committees. It is recognised that it is not necessarily practical to set 
meaningful metrics or targets for diverse membership of Committees 
due to the notably smaller membership of each of the Committees 
compared to the size of the Board. Accordingly, our principles-based 
approach endorses the importance of bringing diverse perspectives 
to all areas of Board and Committees’ work. As an example of this 
principles-based approach in practice, as part of its regular 
Committee succession planning activity, the Nomination & 
Governance Committee considers the gender and ethnic balance on 
each Committee when assessing its composition and future needs.
As at 31 December 2022, 50% of Directors were women (2021: 50%), 
exceeding the target of 40% women’s representation by the end of 
2025, as recommended by the FTSE Women Leaders Review. We are 
also satisfied that, ahead of the target implementation date, we are 
compliant with the new FCA requirements stating that boards should 
have at least one woman in the Chair, Chief Executive, Senior 
Independent Director or Chief Financial Officer role, and that at least 
one member of the Board should be from an ethnic minority 
background, among other targets. The FCA requirements are 
applicable to Pearson with effect from the financial year which began 
on 1 January 2023.
One of the topics the Board considered during its evaluation process 
conducted in 2022, was the effectiveness of the organisation and 
dynamics of the Board, including in respect of diversity. The results 
and feedback provided by the evaluation indicated that the Directors 
believe the Board’s diversity is strong. The Board recognised the 
increasing importance of DE&I and acknowledged the progress being 
made. It noted that wider forms of diversity, such as sexual 
orientation, disability, age, and socio-economic background, would be 
considered when making new appointment decisions. 
Diversity and talent at executive level 
Five members of our executive team of 10, excluding the Chief 
Executive and Chief Financial Officer who are counted in the Board’s 
metric, are women (50% as opposed to 37.5% in 2021). Including the 
Chief Executive and Chief Financial Officer, this ratio stays at 50% (six 
women out of 12 members) (2021: 40%). As of 31 December 2022, 
the senior management team (as specified by the UK Corporate 
Governance Code), i.e. the executive management team and their 
direct reports, including the Company Secretary, contained 53 
women, representing 50% of that group (2021: 49%). For diversity 
data in the format prescribed by LR 9.8.6R(10), please see page 225.
All leadership and mentoring programmes aim to have 50% of their 
candidates from diverse backgrounds. The Nomination & 
Governance Committee received updates on two internal mentoring 
schemes that it supports. The first scheme pairs a high-potential 
leader (typically at Senior Vice President level) with a Non-Executive 
Director. The second scheme involves members of the executive 
management team sponsoring a small group of individuals at 
management level, identified through our talent review process as 
potential successors of senior management. 
In 2022, we revised our approach to strengthen mentoring schemes 
by focusing on the creation of mentoring partnerships based on skill 
development needs. We are currently gathering feedback on the 
outcomes of Board sponsorship and mentoring schemes in 2022 
and are in the process of identifying candidates for opportunities 
in 2023. 
Diversity across Pearson
Nomination & Governance Committee report continued
76 Pearson plc Annual report and accounts 2022
Board diversity objectives 
The Nomination & Governance Committee monitors the progress on the company’s DE&I framework, governance and measurement models, and 
priority areas. As part of this, the Nomination & Governance Committee reviewed and updated the objectives which underpin the Board Diversity 
Policy. The objectives in place during 2022 and Pearson’s performance against them are set out below, together with an indication of the amendments 
(highlighted) to the objectives that have been approved in response to the FCA requirements:
Objectives 
Progress
We will strive to achieve and maintain a Board composition of: 
 
— at least 40% Directors are women
 
— at least two Directors from an ethnic minority background 
 
— at least one of the Chair, Chief Executive, Deputy Chair and 
Senior Independent Director or CFO is a woman
As at 31 December 2022:
 50% Directors were women
 The Board included three Directors from an ethnic minority 
background
 One of the Chair, Chief Executive, Deputy Chair and Senior 
Independent Director or CFO is a woman
All Board appointments will be made on merit, in the context of the 
skills and relevant experience that are needed for the Board to 
oversee Pearson’s strategic development and that reflect the global 
nature of our business. 
 Our Non-Executive Director search process considers a wide range 
of candidates, including from diverse backgrounds, all of whom were 
evaluated on the basis of merit. Our most recent search processes 
resulted in the appointment of Esther Lee and Omid Kordestani, 
whom the Board believe possess the requisite skills and experience 
for their roles.
The Board will continue to incorporate a focus on a diverse pipeline 
in its succession and appointment planning, including to prioritise 
the use of search firms which adhere to the Voluntary Code of 
Conduct for Executive Search Firms (the Voluntary Code) when 
seeking to make Board-level appointments.
 The Committee actively includes diversity in its search criteria for 
Board appointments, and proactively encourages engaged search 
firms to include candidates from a range of diverse backgrounds in 
its candidate lists.
 
Spencer Stuart assist Pearson with search activities, including for the 
external element of the Non-Executive Director search processes.  
Spencer Stuart is a signatory to the Voluntary Code.
The Board will continue to adopt best practice, as appropriate, in 
response to the Parker Review, FTSE Women Leaders Review, FRC 
Board Director Effectiveness Review, and Financial Conduct 
Authority requirements.
 The Board is cognisant of the recommendations of the FTSE Women 
Leaders Review, which has succeeded the Hampton-Alexander 
Review, and the findings of the FRC Board Diversity and Effectiveness 
report. The Committee also reflected the new FCA requirements in 
respect of gender and ethnic diversity in its review of the Board 
Diversity Policy. 
The Board will consider its composition and diversity, and that of 
its Committees, as part of its consideration of effectiveness in the 
Board evaluation review process. The Board will also explore 
expansion of these considerations to cover ethnicity, sexual 
orientation, disability and socio-economic background 
characteristics.
 These matters were considered in the 2022 evaluation process. 
Read more on page 71.
Where appropriate, we will assist with the development and 
support of initiatives that promote all forms of DE&I in the Board, 
Pearson Executive Management team and other senior 
management.
 Six mentees at the Senior Vice President (SVP) level were mentored 
by six Non-Executive Directors in 2022. 67% of SVP participants were 
female and/or persons of colour (target at 50%). 
We will review and report on our progress in line with the policy  
and our objectives in the annual report, including providing details  
of initiatives to promote DE&I in the Board, Pearson Executive 
Management team and other senior management.
 Objectives that accompany the Board’s Diversity Policy have been 
updated. The Committee continues to monitor developments on 
DE&I in the external landscape.
We will continue to make key DE&I information about the Board, 
senior management and our wider employee population available 
in the annual report, and aim for ongoing transparency in this area 
in line with best practice.
 This information is included in the annual report. Read more about 
DE&I matters in the wider employee population on page 34.
Key
 Target achieved
 Target not met
New objective for 2023
Annual report and accounts 2022 Pearson plc 77

Reputation & Responsibility Committee report
Committee members and attendance 
Attendance by Directors at scheduled Reputation & Responsibility  
Committee meetings throughout 2022:
Committee members
Meetings attended
Andy Bird
3/3
Linda Lorimer
3/3
Graeme Pitkethly
3/3
Annette Thomas
3/3
Lincoln Wallen
3/3
Principal Committee responsibilities
Stakeholders: Monitoring reputational issues that could 
significantly affect Pearson’s reputation with stakeholders, 
including consumers, employees, shareholders, educational 
institutions and educators, employers, governments and 
regulators, communities and business partners.
Sustainability and non-financial KPIs: Overseeing Pearson’s 
sustainability strategy including: targets and public 
commitments; regulatory landscape, reporting and ratings; ESG 
due diligence in our supply chains and business partnerships; 
matters relating to the non-financial KPIs linked to the three 
pillars of the ESG Framework.
Culture and employee engagement: Overseeing Pearson’s 
approach to employee engagement. Monitoring the company’s 
culture, which stresses diversity and high performance.
Communications and regulatory matters: Overseeing 
Pearson’s communications, strategies, policies and plans 
related to reputational issues and the people, processes and 
policies that are in place to manage them.
Branding: Oversight of how the company’s brands are 
managed and promoted to ensure that their value and the 
company’s reputation are maintained and enhanced. 
Risk: Pearson’s approach to the reputation aspects of the risk 
register and ensuring that clear roles have been assigned for 
the management of these.
Linda Lorimer - Committee Chair
Reputation & Responsibility Committee role
The Committee works to assess and advance Pearson’s reputation 
across the range of its stakeholders and to maximise the company’s 
positive impact on society and the communities in which we work 
and serve.
We are the main governance body for sustainability at Pearson, 
providing important oversight of our environmental, social and 
governance (ESG) framework; this includes climate change 
considerations. As part of this role, we promote and oversee 
Pearson’s sustainable business strategy and assess progress  
against its commitments. We also monitor branding, culture and 
values, and provide ongoing oversight and scrutiny across all 
reputational matters. 
The full Board is kept abreast of the Committee’s work through 
reports I make following each of our sessions. These reports include 
highlighting any areas of concern and offering specific 
recommendations for the Board’s action. 
In 2022, we led a comprehensive review of the Board’s governance 
framework for ESG matters, and made the following 
recommendations for enhancing the Directors’ collective oversight of 
ESG matters, all of which were approved by the Board:
 
— the Audit Committee will assume responsibility for assurance and 
integrity of ESG data and metrics
 
— the Remuneration Committee will formally incorporate ESG 
considerations in remuneration frameworks and decisions
 
— employee engagement will be formally added to this Committee’s 
remit, alongside culture. We have invited the Chief Human 
Resources Officer to be a regular attendee at our meetings as  
a resource on the important topics of employee engagement  
and culture.
We also conducted a thorough review of our own terms of reference. 
The Committee’s principal responsibilities, as revised, are 
summarised to the left of this page and you can read more about our 
overall Board framework for ESG governance on page 66.
As Committee Chair, I am available at any time to engage with any 
shareholders who would like to discuss the work of the Committee, 
and particularly look forward to taking any shareholder questions at 
our forthcoming AGM in April 2023.
It has been my privilege to serve as Chair of the Committee since 
2016, most notably to have had the opportunity to contribute to 
Pearson’s sustainable business strategy as it has matured and to the 
development of our ESG framework. I am delighted that the Board 
has chosen Annette Thomas to be my successor as Chair; Annette 
has shown a real passion for the work of our Committee and has 
both experience and expertise in the remit of the Committee.
Committee composition and attendees
The Committee currently has five members, including me as Chair. 
The members bring a range of expertise across the key areas of the 
Committee’s remit, including sustainability, stakeholder management, 
people and talent, and policy and government relations.
In addition, we benefit from the regular attendance of senior 
executives whose work is central to the remit of the Committee. 
These include the Chief Legal Officer, who is the executive  
leader responsible for the development, monitoring and  
execution of Pearson’s sustainability strategy; the Chief  
Marketing Officer and Co-President of Direct to Consumer;  
the Chief Human Resources Officer; SVP – Investor Relations;  
and SVP – Corporate Communications. 
Sustainability activities in 2022
Throughout the year, the Committee paid particular attention to the 
continued evolution of our sustainability strategy, including how it 
aligns to our greatest areas of opportunity and challenge as a 
business, and how to communicate its tenets to all our stakeholders 
in a clear and impactful way. 
Terms of reference
The Committee has written terms of reference that clearly set out its 
authority and duties. These are reviewed annually and can be found 
in the Governance section of our website (www.pearsonplc.com).
78 Pearson plc Annual report and accounts 2022
 
— we reviewed the annual Modern Slavery Statement with 
management prior to recommending that the Board approve the 
statement for publication.
Other areas of focus during 2022
In addition to the work relating to the three sustainable business 
pillars, we spent time considering a broader range of matters relating 
to Pearson’s reputation and key stakeholders, including the following: 
 
— with the help of colleagues and external advisers, the Committee 
conducted a horizon scanning exercise to identify key 
reputational risks and trends facing Pearson such as critical race 
theory, social issues and increased scrutiny of branded content 
platforms. This exercise, which we intend to conduct periodically, 
helps to ensure that the Committee and our Board is alert to 
external factors that may impact our business
 
— we reviewed a new framework to guide the company about when 
it will ordinarily make public statements concerning societal 
events. Factors that are part of this decision framework include 
whether the event could have a material impact directly on our 
business or people and whether the issue is aligned or misaligned 
with Pearson’s purpose and values
 
— after the US midterm elections and the change in the leadership 
in the UK, we received a government relations update, which is a 
periodic topic for the Committee’s agenda.
Committee evaluation
The Committee undertakes an annual evaluation to review its 
performance and effectiveness. For our evaluation in 2022, 
Committee members and other key contributors to the Committee 
were invited to provide their views by way of a tailored questionnaire.
Topics covered included the effectiveness and dynamics of the 
Committee, oversight of key areas within the Committee’s remit, the 
quality of papers and meeting discussions, and the relationships 
between the Committee and management.
The Committee considered the findings from this process at its 
November 2022 meeting and concluded that:
 
— the Committee is working well with appropriate agendas, papers 
produced to a good standard, and high-quality discussions 
 
— some refreshing of the Committee’s remit was warranted to 
specify explicitly that employee engagement and the company’s 
culture are part of the Committee’s remit as well as expanded 
responsibility for ESG and sustainability. This feedback guided the 
revisions to the terms of reference review undertaken towards 
the end of the year
 
— it may be beneficial to provide greater exposure for the 
Committee to a range of external viewpoints and advice.  
In direct response to this suggestion, the Committee welcomed 
external advisers to its ESG deep dive session, where external 
perspectives were provided on Pearson’s ESG materiality 
assessment and ambitions.
The matters identified during the previous year’s evaluation process 
have been addressed to the Committee’s satisfaction during the year, 
as described elsewhere in this report.
Committee aims for 2023
Our priorities for the coming year include the publication of 
Pearson’s climate transition plan and the launch of various activities 
to empower our people to make a difference through learning 
opportunities and skill-based volunteering. We will continue to 
oversee Pearson’s ESG framework including progress under each of 
our three sustainable business pillars, as well as overseeing the newly 
refreshed approach to employee engagement and culture.
Linda Lorimer
Chair of Reputation & Responsibility Committee
As described in greater detail in our Sustainability report starting on 
page 30, our ESG framework comprises three pillars that align with 
the interests of stakeholders, and where we can make the biggest 
positive impact:
 
— Driving learning for everyone with our products
 
— Empowering our people to make a difference
 
— Leading responsibly for a better planet
These areas are also materially influential in helping Pearson succeed 
as a business. The pillars have a clear, natural fit to our non-financial 
KPIs, reflecting the common goal of alignment between our 
corporate and sustainability strategy. The sustainability strategy is 
supported by Pearson’s robust corporate governance, strong 
corporate culture and a range of effective policies to ensure we 
achieve our ambitions. 
The Committee receives regular updates from management on 
progress against specific elements of the sustainability strategy. Over 
the past year, key activities of the Committee in relation to our three 
sustainable business pillars included the following:
Driving learning for everyone with our product
In the course of the year, we had reviews of product efficacy and 
learning design; we undertook our annual safeguarding review, which 
included our growing attention to digital products and services; and 
we assessed the company’s consumer brand equity study.
At each meeting, the Committee receives a report on recent incidents 
and issues that could have an impact on the company’s reputation, 
including those relating to our products. We consider Pearson’s 
responses to coverage on social media and in traditional media, 
including paying particular attention to our protocols for responding 
to questions about our content, the integrity with which we handle 
such situations, and any lessons learned. In response to these 
reports, the Committee provided input about addressing the specific 
incidents at hand, and made recommendations about how the 
company can be responding to the general issues raised.
Empowering our people to make a difference
In the course of the year, the Committee asked the Chief Human 
Resources Officer to lead a session devoted to talent, performance 
and engagement. We also reviewed new plans for the evolution of 
our overall approach to employee engagement and continued our 
practice of an annual review of health and safety across the company.
Leading responsibly for a better planet
In the past year, the Committee monitored progress in respect of 
climate transition plans, including receiving an update on Pearson’s 
decarbonisation journey. As part of this, we provided 
recommendations to management on how to approach reduction in 
Pearson’s scope 1, 2 and 3 emissions, with reference to the maturity 
of climate performance in our supply chain
Given world events, the Committee received an update on the status 
of Pearson’s business operations in Ukraine, Russia and Belarus.
ESG governance and policies
Our three sustainable business pillars are underpinned by robust 
governance, a strong culture and effective policies. In this regard, 
during the year:
 
— we reviewed an ESG materiality assessment which confirmed that 
the views of our external stakeholders align well with our internal 
ambitions. With input from management and external advisers, 
we noted improvement opportunities for our core business areas 
to enhance their impact on Pearson’s sustainability ambitions
 
— we revised the Board’s ESG governance framework, as noted on 
page 66
 
— we received an update about how the company will be reporting 
its ESG progress to external regulatory bodies, including the 
approach for our narrative, non-financial KPI reporting and 
external data verification, where we work closely with our 
colleagues on the Audit Committee. We also noted how 
management plans to evolve our reporting in line with  
regulatory changes
Annual report and accounts 2022 Pearson plc 79

Principal Committee responsibilities
Financial reporting
The quality and integrity of Pearson’s financial reporting and 
statements and related disclosures, including significant 
reporting judgements. 
Policy
Group financial policies, including accounting policies  
and practices.
External audit
External audit, including the appointment, qualification, 
independence and effectiveness of the external auditor.
Internal audit, risk and internal control
Risk management systems and the internal control 
environment, including oversight of the work and effectiveness 
of the internal audit function.
Compliance and governance
Legal and regulatory requirements in relation to financial 
reporting and accounting matters, and oversight of compliance 
programmes and investigations.
Audit Committee report
My predecessor in the role, Tim Score, remains a valued member of 
the Committee and I offer my thanks to Tim for his considerable 
contributions as Committee Chair. 
The Committee has been established by the Board primarily for the 
purpose of overseeing the accounting, financial reporting, internal 
control and risk management processes of the company and the 
external audit of the financial statements of the company. As a 
Committee, we are responsible for assisting the Board’s oversight  
of the quality and integrity of the company’s external financial 
reporting and statements, and the company’s accounting policies 
and practices.
Pearson’s Vice President – Internal Audit has a dual reporting line  
to the Chief Financial Officer and to me, and both she and the 
external auditors have direct access to the Committee to raise  
any matters of concern and to report on the results of work directed 
by the Committee. As Audit Committee Chair, I ensure that the full 
Board is kept abreast of the business of the Committee in a timely 
manner, including highlighting any areas of concern or specific 
recommendations. I also work closely with the CFO and senior 
financial, risk, legal and internal audit personnel outside the  
formal meeting schedule to ensure robust oversight and challenge  
in relation to financial control, compliance, investigations and  
risk management. 
As Committee Chair, I am available to engage with any shareholders 
who would like to discuss the work of the Committee, and look 
forward to taking any shareholder questions at our forthcoming AGM 
in April 2023. 
Audit Committee meetings and activities
An important area of focus for the Committee throughout 2022 was 
the transition of Pearson’s external audit from 
PricewaterhouseCoopers LLP (PwC) to Ernst & Young LLP (EY), who 
were selected following a competitive tender process in 2021. The 
transition process and first audit by EY have necessitated 
considerable efforts by all involved, and I would like to acknowledge 
the commitment demonstrated by all Pearson colleagues throughout 
the financial year who have supported the audit process. You can 
read more about how the Committee has monitored the transition to 
EY on page 84.
Other prominent themes in the Committee’s work throughout  
2022 included:
 
— important areas such as data privacy, cyber security and business 
and technology resilience. In addition to continuing to increase in 
importance at a macro level, these are key factors in the success 
of Pearson’s digital and consumer-focused strategy
 
— a strong focus on risk, supported by a new programme of 
business-focused deep dives led by the Divisional Presidents
 
— oversight of accounting treatment relating to portfolio changes, 
including the strategic review of Pearson’s international 
courseware local publishing businesses
 
— continued oversight of Pearson’s key judgements and key areas of 
estimation as described in the financial statements.
At every meeting, the Committee also considered reports on the 
activities of the internal audit and compliance functions, including the 
results of internal audits, project assurance reviews and fraud and 
whistleblowing reports. The Committee also monitored the 
company’s financial reporting procedures, discussed the finance and 
IT controls environment, reviewed the services provided by the 
external auditors and considered any significant legal claims and 
regulatory issues in the context of their impact on financial reporting, 
each on a regular basis. You can view the key activities of the 
Committee and read more about our work in these areas on the 
pages that follow.
Additional meeting attendees
The Chief Financial Officer, Deputy Chief Financial Officer, Chief Legal 
Officer, Chief Information Officer, other executives and senior 
managers from across the business also attended meetings during 
the year, either as regular invitees of the Committee or to discuss 
particular items of business. 
Terms of reference
The Committee has written terms of reference which clearly  
set out its authority and duties. These are reviewed annually  
and can be found in the Governance section of our website  
(www.pearsonplc.com).
Committee members and attendance 
Attendance by Directors at scheduled Audit Committee meetings 
throughout 2022:
Committee members
Meetings attended
Linda Lorimer
4/4
Graeme Pitkethly1
3/4
Tim Score
4/4
Lincoln Wallen
4/4
1. Mr Pitkethly was unable to attend one meeting prior to becoming Committee Chair 
due to a pre-existing commitment. He reviewed the papers and provided his 
perspectives to the Committee Chair outside the meeting. 
Audit Committee role and composition
I am pleased to present my first report as Chair of the Audit 
Committee following my appointment to the role on 1 August 2022. 
Graeme Pitkethly - Committee Chair
80 Pearson plc Annual report and accounts 2022
This direct contact with key leadership augments the Committee’s 
understanding of the issues facing the business as well as helping to 
develop Pearson’s talent pipeline through facilitation of Board-level 
engagement opportunities for those leaders and managers. The 
Committee also meets regularly in private with the external auditors 
and with the Vice President – Internal Audit. 
In addition to the Committee’s formal meeting schedule, I meet as 
needed with the external auditors, Chief Financial Officer, Deputy 
Chief Financial Officer, Chief Legal Officer, Chief Compliance Officer 
and Senior Vice President – Treasury, Risk and Insurance in order to 
keep abreast of all relevant matters within the Committee’s remit.
Audit Committee training and knowledge sharing
The Committee receives technical updates at each meeting, including 
on matters such as accounting standards and the audit and 
governance landscape, and members are able to request specific or 
personal training as appropriate. In particular, we remain attentive to 
developments at a legislative and regulatory level, including the 
proposals announced in May 2022 by the UK Government’s 
Department for Business, Energy and Industrial Strategy (BEIS) in 
response to the consultation on ‘Restoring trust in audit and 
corporate governance’. 
The Committee’s focus areas for 2023 will include:
 
— Following up on continuing improvements in the external audit 
process, as discussed further on page 84.
 
— Monitoring progress of the UK Government’s proposals on  
audit and corporate governance reform, any impacts on the 
company’s processes and practices, and consideration of 
management’s response.
 
— Monitoring emerging developments in non-financial reporting, 
including proposals from the ISSB, EU and SEC.
 
— Continuing our attention to technology and cyber risk, through an 
increased frequency of cyber security deep dives and the addition 
of the Chief Information Officer as a standing attendee at all 
Committee meetings. 
Committee evaluation
The Committee undertakes an annual evaluation process to review 
its performance and effectiveness. For 2022, the Committee 
evaluation process was conducted by way of a tailored questionnaire. 
The process sought views on an anonymous basis from Committee 
members and other key contributors to the Committee, including the 
lead external audit partner, the Chief Financial Officer, Deputy Chief 
Financial Officer, the Chief Legal Officer, the Vice President – Internal 
Audit, and senior financial, risk and compliance management.
Topics covered in the evaluation included the effectiveness and 
dynamics of the Committee, the Committee’s oversight of key areas 
within its remit, the quality of papers and meeting discussions, and 
the relationships between the Committee and management.The 
Committee considered the findings from the evaluation at its 
November 2022 meeting, including the following key points:
 
— The Committee is considered by Directors and other contributors 
to be working well with appropriate agendas, papers produced to 
a good standard and high-quality discussions. 
 
— Respondents welcomed the addition of divisional risk deep dives 
to the Committee’s work plan and noted the importance of 
dedicating sufficient time to the overview of risk and associated 
remediation actions. 
 
— Respondents recognised that it is important for all parts of the 
Group’s assurance framework to remain attuned to the changing 
risk profile of the company, including data and cyber risk. It 
remains important for the Committee to ensure that it continues 
to have appropriate levels of support and expertise to assess and 
manage these areas.
 
— Given the quantum of Pearson’s business in the US, there was a 
suggestion that at least one meeting per cycle be US-based to 
allow the Committee in-person access to US management and 
other stakeholders. We expect to be able to reintroduce this 
element to the Committee’s annual schedule following the 
relaxation of COVID-19 related travel restrictions.
 
— Responses highlighted the Committee’s role in encouraging 
collaboration and alignment between the central corporate  
risk assessment and compliance functions and the work of 
internal audit.
Actions taken following the previous year’s evaluation
Based on the recommendations from the previous year’s evaluation, 
the Committee took the following actions in 2022:
 
— We assumed responsibility in our terms of reference for matters 
relating to assurance of ESG metrics. During the year, the 
Committee considered and approved Pearson’s policy on 
greenhouse gas emissions re-baselining and restatement. This 
policy has established guidelines for the recalculation of the base 
year, as well as restatements, for scope 1, 2 and 3 emissions in 
the event of significant changes to Pearson’s portfolio.
 
— Recognising the importance of technology and cyber-related 
matters to Pearson’s business and strategy, we invited the Chief 
Information Officer to become a standing attendee at the 
Committee’s meetings. Previously, the Chief Information Officer 
was invited to attend for specific agenda items. This strengthens 
the oversight that the Committee has of technology matters and 
enables timely engagement with the responsible executive 
whenever technology-related topics arise in our discussions.
Fair, balanced and understandable reporting
We are mindful of the Code’s Principle N relating to fair, balanced and 
understandable reporting, and we build sufficient time into our 
annual report timetable to ensure that the full Board receives 
sufficient opportunity to review, consider and comment on the report 
as it progresses. Learn more about fair, balanced and 
understandable reporting on page 123.
Financial reporting and policies
In February 2023, the Committee considered the 2022 preliminary 
results announcement and annual report and accounts, including the 
financial statements, strategic report and Directors’ report. The 
significant issues considered by the Committee relating to the 2022 
financial statements are set out on pages 86-87.
Correspondence with Financial Reporting Council
In October 2022, Pearson received a letter from the Financial 
Reporting Council (FRC) confirming that it had completed a limited 
scope review of the company’s 2021 annual report in connection 
with their thematic review of deferred tax asset disclosures. There 
were no questions or queries to which the FRC required a formal 
written response. Two matters were raised regarding possible 
improvements to our existing disclosures. These have been 
addressed in the 2022 annual report where material and relevant. 
The FRC’s role is to consider compliance with reporting standards 
and is not to verify the information provided. Therefore, given the 
scope and inherent limitations of their review, which does not benefit 
from any detailed knowledge of the Group, it would not be 
appropriate to infer any assurance from their review that our 2021 
Annual Report and Accounts are correct in all material respects.
Risk assessment, assurance and integrity
A key role of the Committee is to provide oversight and assurance to 
the Board with regard to the integrity of the company’s procedures 
for the identification, assessment, management and reporting of risk. 
In fulfilling its remit, the Committee remains mindful that effective risk 
management is essential to executing Pearson’s strategy, achieving 
sustainable shareholder value, protecting the brand and ensuring 
good governance. 
In 2022, the Committee had oversight of management’s refreshed 
approach towards risk identification and monitoring. Pearson’s risk 
management programme has evolved in line with the structure of 
the business, which is managed through five global operating 
divisions supported by enterprise-wide corporate functions. 
Annual report and accounts 2022 Pearson plc 81

Through a series of business-focused risk deep dives, the President 
of each operating division provides an overview of its risk register to 
the Committee at least annually and leads a session on the key risks 
facing their particular division. The process is supported by central 
risk team experts as required, providing the Committee with a clear 
and consistent framework within which to evaluate the strategic  
and business risks to the company, based upon the principal, 
emerging and significant near-term risk categories described on 
pages 45-51. 
The Committee uses these deep dive sessions to understand the 
rigour of management’s risk scanning and to challenge judgements 
being made in response to risks. The Committee has reviewed the 
refreshed risk management approach to ensure it is robust and 
proportionate, and continues to facilitate a culture of accountability 
and ownership among business leaders. The introduction of 
divisional risk deep dives has provided a valuable strategic lens to the 
risk management process that has been welcomed by the 
Committee and management alike. 
During the year, the Committee also conducted a number of deep 
dives with selected enterprise-wide functions including data  
privacy, cyber security, tax, anti-bribery and corruption, and  
business resilience.
Data privacy, cyber security and technology resilience 
Prudent management of data privacy, cyber security and Pearson’s 
technology estate are fundamental to the company’s success and to 
building and maintaining trust with our customers. The Committee 
oversees these matters on behalf of the Board from a risk and 
assurance perspective and monitors the maturity of Pearson’s 
associated governance frameworks. It does this through annual deep 
dives, as well as through oversight of the risk-based internal audit 
programme, in which these topics are key areas of focus.
Audit Committee report continued
Audit Committee meeting focus during 2022
Financial reporting
Policy
External audit
Internal audit,  
risk and internal control
Compliance  
and governance
 
— Accounting and 
technical updates
 
— Impact of legal claims 
and regulatory issues 
on financial reporting
 
— Fair, balanced and 
understandable 
reporting, going  
concern and viability 
statements including 
supporting analysis
 
— 2021 annual report 
and accounts: 
preliminary 
announcement, 
financial statements 
and income statement 
 
— Review of interim 
results and trading 
updates
 
— Form 20-F and related 
disclosures, including 
annual Sarbanes-
Oxley Act Section 404 
attestation of  
financial reporting 
internal controls 
 
— Significant issues 
reporting
 
— Accounting 
matters and 
Group 
accounting 
policies
 
— Treasury Policy 
and reporting
 
— Tax update
 
— Greenhouse 
gas emissions 
- policy for 
re-baselining 
and 
restatement
 
— Oversight of external auditor 
transition and first-year audit by 
new auditor
 
— Provision of non-audit services 
by external auditor - policy and 
regular reporting
 
— Appointment of  
external auditors
 
— Report on half-year procedures
 
— Confirmation of  
auditor independence
 
— 2022 external audit plan
 
— Remuneration and engagement 
letter of external auditors
 
— Review opinion on interim results
 
— Review of the effectiveness of 
external auditors
 
— EY feedback on  
internal controls over financial 
reporting
 
— Receipt of external  
auditors’ report on annual 
report, Form 20-F and year-end 
audit
 
— EY feedback on  
internal controls over financial 
reporting
 
— Internal audit activity 
reports and review of  
key findings
 
— 2022 internal audit plan 
including resourcing
 
— Assessment of  
the effectiveness of 
internal audit function, 
internal control 
environment and risk 
management systems
 
— Risk management 
including Group’s 
principal and  
emerging risks
 
— Strategic risk reviews led 
by Divisional Presidents
 
— Group-wide risk deep 
dives on cyber security; 
data privacy; treasury 
and insurance; 
anti-bribery and 
corruption; and  
business resilience and 
crisis management
 
— Controls Centre of 
Excellence updates, 
including 2022 work plan
 
— Fraud, 
whistleblowing 
reports and 
compliance 
investigations
 
— Compliance with 
accounting and 
audit-related aspects  
of the UK Corporate  
Governance Code
 
— Audit Committee 
and internal audit 
function terms of 
reference
 
— Oversight of Group’s 
schedule of 
delegated financial 
authority
 
— Regulatory briefings, 
including proposals 
resulting from BEIS 
consultation on audit 
and corporate 
governance reform
 
— Review of minutes of 
the Verification 
Committee’s 
meetings
As part of the data privacy deep dive led by the Chief Privacy Officer, the 
Committee considered developments in the global regulatory landscape 
and trends in enforcement actions, focusing on the importance of 
transparency and controls around the use of personal information. 
These regulatory trends, combined with Pearson’s direct to consumer 
strategy, mean that a compelling user experience is imperative. 
Accordingly, the Committee discussed the progress that had been made 
through the launch of a new public-facing privacy centre, which provides 
an effective and customer friendly approach to explaining how Pearson 
uses personal information. The Committee also considered the ongoing 
enhancements to Pearson’s data privacy governance structure, including 
a newly implemented network of designated privacy owners, 
strengthening of the internal incident management framework, and 
continued focus on data retention programmes with a particular focus 
on customer products, platforms and services.
The Committee also considered the status of Pearson’s cyber security 
programme, through a deep dive led by the Chief Information Officer 
and Chief Information Security Officer. This deep dive was set in the 
context of the challenges and threats prevalent in the dynamic global 
security landscape. As part of this, the Committee received a report on:
 
— Pearson’s cyber risk profile, including the status and trend of top 
threats and response to these threats, with a particular focus on 
strategic products
 
— Management’s key achievements and focus areas in 2022, which 
included: simplifying and updating information security policies to 
support Pearson’s digital strategy; enhancement of identity 
management capabilities; development of role specific security 
training; implementation of supplier security risk management; 
and continued attention to best practices for cloud security
 
— Objectives for the continued enhancement of Pearson’s cyber 
security infrastructure and governance frameworks, including the 
key achievements in 2022 and aims for the coming year
 
— Findings of the annual third party assessment of Pearson’s  
cyber capability maturity, which continues to demonstrate 
year-on-year improvement. 
82 Pearson plc Annual report and accounts 2022
Members
As at the date of this report, the Committee comprises four 
independent Non-Executive Directors, all of whom have financial 
and/or related business experience due to the senior positions 
they hold or have held in other listed or publicly traded companies 
and/or large organisations. The Committee possesses a good 
balance of skills and knowledge with competence and experience 
covering all aspects of the sectors in which Pearson operates and 
the company’s key markets. Each member is “financially literate” 
for the purposes of the NYSE listing standards.
Graeme Pitkethly, Chair of the Committee since August 2022, is 
the Committee’s designated financial expert within the meaning 
of the applicable rules and regulations of the SEC, having recent 
and relevant financial experience, and is a Chartered Accountant. 
Graeme is Chief Financial Officer for Unilever plc and serves as 
Vice-Chair of the Financial Stability Board’s Task Force on 
Climate-related Financial Disclosures (TCFD). Graeme’s full 
biography is shown on page 57.
The qualifications and relevant experience of the other Committee 
members are detailed on pages 56 to 58. You can read more on 
page 59 about the process through which the Board assesses the 
independence of Non-Executive Directors.
The Committee has a strong focus on Pearson’s cyber security 
maturity and will increase its scrutiny of this topic by conducting two 
deep dives each year from 2023. As mentioned elsewhere in this 
report, the Chief Information Officer now attends every Committee 
meeting, to ensure ongoing focus on matters of both cyber security 
and technology resilience, among others.
As indicated in last year’s annual report, the Committee also continued 
to monitor management’s implementation of the Board’s agreed 
action plan following a 2018 security incident affecting AIMSweb 1.0. 
The Committee has concluded that the key workstreams have been 
successfully delivered, with the agreed improvements now having 
been incorporated into standard company practices.
The Committee also holds a separate annual deep dive, led by the 
Chief Information Officer, focusing on Pearson’s technology resilience 
capabilities. In 2022, this session included updates on infrastructure 
enhancements, management of the end-of-life technology estate, 
product availability and incidents, and technology-specific talent risk.
The Committee also paid particular attention to the work of  
the sanctions team and wider business in response to the war 
in Ukraine. 
Internal audit
The internal audit function is responsible for providing independent 
assurance to management and the Committee on the design and 
effectiveness of internal controls to mitigate strategic, financial, 
operational and compliance risks. The Vice President – Internal Audit 
reports jointly to the Chair of the Committee and the Chief Financial 
Officer and is responsible for the day-to-day operations of internal 
audit and execution of the annual audit plan. 
The internal audit mandate is approved annually by the Committee. 
The audit plan and any changes thereto are also reviewed and 
approved by the Committee throughout the year, and the Committee 
is attentive to the resourcing of the internal audit function. The 
internal audit plan is aligned to Pearson’s greatest areas of risk, as 
identified by the organisational risk management process, and the 
Committee considers issues and risks arising from internal audits. 
Management action plans to improve internal controls and to 
mitigate risks are agreed with the business area after each audit. 
Internal audit has a robust process in place for the implementation of 
audit actions, which also includes review and testing of evidence to 
corroborate action implementation. Progress of management action 
plans is reported to the Committee at each meeting. Internal audit 
has a formal collaboration process in place with the external auditors 
to ensure efficient sharing of insights and outcomes. Opportunities 
for reliance by the external auditor on internal audit outcomes are 
limited due to strict rules set by the external regulator. Regular 
reports on the findings and emerging themes identified through 
internal audits are provided to executive management and, via the 
Committee, to the Board.
In 2022, internal audit carried out engagements across Pearson’s 
business units and corporate functions covering most of the principal 
risks. The audit plan changes throughout the year based on changes 
in Pearson’s risk profile. Key themes in 2022 related to information 
security and data privacy, cyber security, data architecture and usage, 
digital safeguarding and business resilience, as well as financial 
controls in international businesses.
Internal audit evaluation
At its November 2022 meeting, the Committee considered the 
findings of the review of the performance and effectiveness of 
Pearson’s internal audit function, a process which is undertaken 
annually. The 2022 review was conducted by distributing a 
questionnaire to the key stakeholders of the internal audit function 
– including Committee members, the lead external audit partner, 
members of the executive management team, and senior financial, 
legal and operational management.
The evaluation process sought views on an anonymised basis on the 
internal audit function’s work programme, resource levels, skills and 
expertise, and ways of working. Based on the findings of the 2022 
review, the Committee is of the opinion that the quality, experience 
and expertise of the internal audit function is appropriate for the 
business. The Committee recognised the findings of the review which 
noted that the internal audit function continues to improve 
collaboration with other teams, including the corporate risk and 
compliance teams, and is supportive of the desire to bring a greater 
level of data-based insight to add context to the findings of internal 
audit’s work. The Committee will remain attentive to the use of 
co-sourcing arrangements to supplement the internal audit 
function’s resource, particularly to ensure appropriate coverage of 
specialist areas.
The Committee will ensure that an independent third-party 
assessment of the effectiveness and processes of the internal audit 
function is conducted at least once every five years, in line with the 
requirements of the Institute of Internal Auditors’ International 
Standards for the Professional Practice of Internal Auditing. The most 
recent such assessment was undertaken in 2019.
Compliance, fraud and whistleblowing
The Chief Compliance Officer oversees compliance with our Code of 
Conduct and works with senior legal, HR and other relevant 
personnel to investigate any reported incidents, including ethical, 
corruption and fraud allegations. The Committee receives an update 
at each meeting on all significant investigations as well as reviewing 
data regarding matters raised through our whistleblowing reporting 
system. If applicable, any findings of the external auditors with 
respect to a particular matter are also considered as part of these 
discussions. The Committee may also meet in private if required with 
the Chief Compliance Officer. On behalf of the Board, the Committee 
considers an annual review of the effectiveness of the whistleblowing 
system including through benchmarking against peers and by 
monitoring progress against previous years’ findings. The Committee 
Chair’s regular reports to the Board include a review of investigations 
or whistleblowing matters of note. 
The Pearson anti-bribery and corruption (ABC) and sanctions 
compliance programmes provide the framework to support our 
compliance with various regulations such as the UK Bribery Act 2010 
and the US Foreign Corrupt Practices Act. The Committee uses this 
framework to conduct a deep dive into the ABC and sanctions 
compliance programmes on an annual basis. In 2022, in addition  
to its regular review of investigations, the Committee noted the 
continued enhancements made to the overall compliance 
programme, including ongoing training for staff, development  
of a set of FAQs for employees to provide insight into the 
investigations process, and enhancements to the ways in which 
Pearson monitors third parties with which it does business. 
Annual report and accounts 2022 Pearson plc 83

Internal control and risk management
The Board has overall responsibility for Pearson’s systems of internal 
control and risk management, which are designed to manage, and 
where possible mitigate, the risks facing Pearson, as well as to 
safeguard assets and provide reasonable, but not absolute, 
assurance against material financial misstatement or loss. 
The Board agrees risk management requirements and, in assessing 
the effectiveness of the risk management effort, reviews a range 
of inputs as described elsewhere in this report. The Board can 
and does challenge the reporting it receives and will request further 
information as needed to make its assessment.
The Committee monitors the effectiveness of the company’s risk 
management and internal control systems on behalf of the Board. 
The Committee oversees a risk-based internal audit programme, 
including periodic audits of the risk processes across the 
organisation. It provides assurance on the management of risk 
(including via risk deep dives, as described on page 81), and receives 
reports on the efficiency and effectiveness of internal controls with 
input from the Deputy Chief Financial Officer and external auditor. 
Each business area maintains internal controls and procedures 
appropriate to its structure, business environment and risk 
assessment, while complying with company-wide policies, standards 
and guidelines. These controls and procedures are monitored and 
certified through the Group-wide Controls Centre of Excellence and 
are subject to testing as part of both the internal and external audit 
processes.
The Committee, acting on behalf of the Board, confirms that it has 
conducted and continues throughout the year to review the 
effectiveness of Pearson’s systems of risk management and internal 
control in accordance with Provision 29 of the Code and the FRC 
Guidance on Risk Management, Internal Control and Related 
Financial and Business Reporting (‘FRC Guidance’). In making its 
assessment as to the effectiveness of these systems for 2022, the 
Committee had regard to an assurance opinion from the internal 
audit function. Factors considered in this process included:
 
— the outcomes of internal audits completed during the year
 
— significant changes in Pearson’s strategy, processes and systems
 
— the wider Pearson risk management and assurance framework 
which includes other assurance activities by first and second line 
of defence teams, including enterprise risk management, the 
Controls Centre of Excellence, divisional and technology 
assurance teams
 
— work conducted by the external auditor
 
— the organisation’s response to internal audit actions
 
— whether any fundamental or significant actions have not been 
accepted by management and the consequent risk
 
— whether any limitations have been placed or the scope  
of internal audit.
The Committee reviewed the detail underpinning these factors as 
part of the 2022 year-end process. The Committee reviewed all 
internal control deficiencies identified during the year and noted that 
the majority have been remediated during 2022. In particular, the 
Committee reviewed the control implications of the issue related to 
investments in unlisted securities (see page 87) and were satisfied 
that the control deficiency has been remediated. They also 
considered feedback on information provided by the entity (IPE) that 
underpins control operation. Following this review, the Committee 
confirms that Pearson’s systems of risk management and internal 
control operated satisfactorily throughout the year.
The Board is ultimately accountable for effective risk management in 
Pearson and determines our strategic approach to risk. It confirms 
our enterprise risk management framework as well as our risk 
appetite targets. The involvement of the Board and Committee in the 
design, implementation, identification, monitoring and review of risks 
(including setting risk appetite and reviewing how risk is being 
embedded in our culture) is outlined in more detail in the Risk 
management section on page 43.
External audit
In June 2021, the company announced the Board’s intention to propose 
to shareholders that EY be appointed as the company’s statutory 
auditor for the financial year ending 31 December 2022. The audit 
tender process was described in detail in the 2021 annual report and 
EY’s appointment was approved by shareholders at the 2022 AGM. 
Following the tender process in 2021, Pearson will put the external 
audit contract out to tender at least every ten years and will seek the 
rotation of the audit partner in line with regulation and professional 
and ethical guidance. The external auditors are required to rotate 
the audit partner responsible for the Pearson audit every five years. 
The 2022 audit was the first year for the EY lead audit partner, Ben Marles.
A detailed audit plan was received from EY at the beginning of the 
audit cycle for the 2022 financial year, which gave an overview of its 
approach to the audit, outlining the significant risk areas and in 
particular the approach to materiality and scoping of the audit. 
The Committee regularly reviewed the significant audit risks and 
assessed the progress of the audit throughout the year. The Committee 
also received updates throughout the year from both management 
and EY on the progress of the first-year audit to allow the Committee 
to assess the effectiveness of the transition process and to monitor the 
status of specific areas such as EY’s review of internal controls and 
their assessment of accounting judgements. 
The Committee reviews and makes recommendations to the Board in 
respect of the appointment and compensation of the external 
auditors. These recommendations are typically made by the 
Committee after considering the external auditors’ performance during 
the year, reviewing external auditor fees, conducting an effectiveness 
review, considering the annual report on audit quality of the intended 
external audit firm and confirming the independence, objectivity, 
qualifications and experience of the external auditors.
External audit effectiveness review
In conducting its review of the effectiveness of EY, Pearson’s external 
auditors for 2022, the Committee had regard to certain factors set out 
in the FRC’s guidelines titled ‘Audit Quality Practice Aid for Audit 
Committees’ as well as the key areas of importance from a strategic, 
operational, reporting and regulatory perspective. In particular, the 
Committee considered its own observations and interactions with the 
external auditors, the quality of the audit, the auditors’ independence, 
the programme of work conducted by the auditors and their reports 
on that work. 
The review was conducted by distributing a questionnaire to key audit 
stakeholders, including members of the Committee and key management 
who interact with the external auditors on a regular basis, including the 
Chief Financial Officer, Deputy Chief Financial Officer, Senior Vice President 
– Treasury, Risk and Insurance, Vice President – Internal Audit, Senior 
Vice President – Finance for each business division, and other heads of 
corporate functions. The process sought views on an anonymised 
basis on many aspects of EY’s work and interactions with the company, 
as well as their mindset, skills and knowledge. In the first year of EY’s 
tenure as Pearson’s external auditor, there was a particular focus on 
the transition process, EY’s review of the control environment, ways of 
working between the Pearson and EY teams, and the observations that 
EY had made on Pearson’s business, processes, controls and systems. 
In considering the independence of the external auditor, the Committee 
has regard to, among other things, EY’s challenge to management, the 
degree to which they demonstrate professional scepticism, integrity 
and judgement in their work, the amount of time passed since a rotation 
of audit partner and the level of non-audit work that the external 
auditor undertakes (details of which can be found on page 85). 
The responses to the evaluation indicated that the external audit 
partners and staff exhibit professional scepticism in their work and are 
robust in dealing with issues identified during the audit. In particular, 
respondents remarked upon the scrutiny demonstrated by EY in 
testing the system of internal controls and the Committee noted the 
challenge presented to management by the auditors in respect of 
accounting judgements from prior years. Overall, having reviewed the 
effectiveness and independence of the external auditors during 2022, 
the Committee concluded that the auditors provide effective 
independent challenge to management.
Audit Committee report continued
84 Pearson plc Annual report and accounts 2022
In early 2022, the Committee asked the outgoing auditor, PwC, to 
share its perspectives on outputs from the previous year’s evaluation 
process. The purpose of this was to support a smooth transition by 
enabling the Committee and EY to take forward the opportunities for 
improvement identified in the 2021 review.
The Committee will continue to review the performance of the 
external auditors on an annual basis and will consider their 
independence and objectivity and the quality of the external audit, 
taking account of all appropriate guidelines.
Naturally, given this was a year of transition, a number of 
opportunities for further improvement were identified through the 
effectiveness review. These primarily related to ways of working 
between the Pearson and EY teams. Following the conclusion of the 
2022 audit, Pearson and EY, led by the Deputy Chief Financial Officer 
and lead audit partner respectively, will work together to develop an 
action plan in response to the recommendations. The Committee will 
oversee implementation of this plan throughout the coming year. 
Compliance with the CMA Order
Pearson confirms that it was in compliance with the provisions of The 
Statutory Audit Services for Large Companies Market Investigation 
(Mandatory Use of Competitive Tender Processes and Audit 
Committee Responsibilities) Order 2014 during the financial year 
ended 31 December 2022. 
Review of the external audit
During the year, the Committee discussed the planning, conduct and 
conclusions of the external audit as it proceeded.
At its April and July 2022 meetings, the Committee discussed and 
approved the external audit plan and reviewed the key risks of 
misstatement of Pearson’s financial statements. The external 
auditors provided an update to the risk assessment at the November 
2022 Committee meeting, following the acquisition and disposal 
transactions in the second half of the year. These risks were then 
confirmed as final at the conclusion of their audit of the financial 
statements in February 2023.
The table on pages 86-87 sets out the significant issues considered 
by the Committee together with details of how these items have 
been addressed. The Committee discussed these issues with the 
auditors throughout the audit year.
In November 2022, the Committee discussed with the auditors the 
status of their work, focusing in particular on internal controls and 
Sarbanes-Oxley testing. 
As the auditors concluded their audit, they explained to the Committee:
 
— the work they had conducted over revenue, including over 
contracts in certain of the Group’s businesses in the US and UK 
that span the year end, where revenue is recognised using an 
estimated percentage of completion based on costs and 
judgements in relation to provisions for returns
 
— their work in evaluating management’s goodwill impairment 
exercise, on a value-in-use basis, including assessing assumptions 
around the cash-generating unit (CGU) reassessment, goodwill 
reallocation, operating cash flow forecasts, perpetuity growth 
rates and discount rates
 
— their work in assessing management’s judgements and 
assumptions regarding the impairment of its right-of-use  
assets and whether property assets should be classified as 
investment property
 
— their work conducted over the accounting treatment of certain 
unlisted securities and their procedures performed over the 
restatement of prior year comparative numbers and the 
associated control implications in relation to this matter
 
— their procedures performed to audit the material acquisitions  
and disposals completed in the year in addition to evaluating 
management’s judgement that the businesses under strategic 
review do not meet the IFRS 5 criteria to be held for sale at  
31 December 2022
 
— the work performed over the nature and presentation of 
adjusting items, focusing on subjective judgements and the 
transparency with which related adjusted measures are 
presented, and in particular the exclusion of costs related to 
major restructuring programmes
 
— their work in assessing management's judgements and assumptions 
regarding provisions for uncertain tax positions, in particular the 
provision made in relation to the EU state aid tax matter
 
— the results of their controls testing for Sarbanes-Oxley Act Section 404 
reporting purposes and in support of their financial statements audit
 
— the results of their work over the company’s going concern and 
viability statement reports
 
— their work in relation to information provided by the entity (IPE) 
disclosures and other material internal control over financial 
reporting (ICFR) matters
 
— their work in relation to other matters which are not classified  
as key audit matters, but may give rise to additional  
disclosure requirements, such as pensions, restructuring and 
asset capitalisation
 
— the work performed over the carrying value of investments in 
subsidiaries for the Pearson plc parent company.
The auditors also reported to the Committee the unadjusted 
misstatements that they had found in the course of their work, which 
were immaterial, and the Committee confirmed that there were no 
material items remaining unadjusted in these financial statements.
Auditors’ independence
In line with best practice, our relationship with EY is governed by our 
policy on external auditors, which is typically reviewed and approved 
annually by the Committee. The policy establishes procedures to 
ensure that the auditors’ independence is not compromised, as well 
as defining those non-audit services that EY may or may not provide 
to Pearson. Any allowable services are in accordance with relevant 
UK and US legislation and auditor standards. The policy takes into 
account certain voluntary commitments by EY regarding 
independence and applies to all Pearson businesses globally, 
including associate companies.
The Committee approves all audit and non-audit services provided 
by EY. Our policy on the use of the external auditors for non-audit 
services complies with the FRC’s Revised Ethical Standard published 
in December 2019. The standard applies restrictions on certain 
non-audit services and applies a cap on the level of permitted 
non-audit services fees which can be billed in any year. The policy 
also reflects the restriction on the use of pre-approval in the 2016 
FRC Guidance on Audit Committees and, accordingly, all non-audit 
services, irrespective of value, are required to be approved by the 
Committee. In particular, we expressly prohibit the provision of 
certain tax, HR and other services by the external auditor. We review 
non-audit services on a case-by-case basis, including reviewing the 
ongoing effectiveness and appropriateness of our policy. 
The Committee receives regular reports summarising the amount  
of fees paid to the auditors. During 2022, Pearson spent a similar 
amount on non-audit fees when compared with 2021. For 2022, 
non-audit fees represented 1% of external audit fees (2% in 2021).
For all non-audit work in 2022, EY was selected only after 
consideration that it was best able to provide the services we 
required at a reasonable fee and within the terms of our policy on 
external auditors. Where EY is selected to provide audit-related 
services, we take into account its existing knowledge and experience 
of Pearson. Where appropriate, services were tendered prior to a 
decision being made as to whether to award work to the auditors.
Significant non-audit work performed by EY during 2022 included:
 
— half-year review of interim financial statements
A full statement of the fees for audit and non-audit services is 
provided in note 4 to the financial statements on page 158. 
Graeme Pitkethly
Chair of Audit Committee
Annual report and accounts 2022 Pearson plc 85

Audit Committee report continued
Significant issues considered by the Audit Committee
Issue
Action taken by Audit Committee
Outcome
Goodwill allocation and impairment reviews
 
— Pearson carries significant goodwill and 
other intangible asset balances. As a 
result of business disposals and an 
associated change in organisation 
structure there has been a change in the 
determination of cash generating units 
and goodwill has been reallocated. There 
are significant estimates and 
assumptions used in the impairment 
review. Pearson has made significant 
impairments to goodwill across a variety 
of its businesses in past years.
 
— The Committee considered the impact of 
acquisitions, disposals and changes in 
organisation design on the determination of 
cash generating units and in particular the level 
at which goodwill is monitored. The Committee 
reviewed the reallocation of goodwill across the 
cash generating units including those disposed. 
 
— The Committee monitored the Group’s plans 
and forecasts during the year to determine if 
there were impairment triggers. The Committee 
considered the results of the Group’s goodwill 
impairment reviews which were undertaken in 
December and refreshed post year end. Key 
assumptions – including cash flows derived 
from strategic and operating plans, long-term 
growth rates and the weighted average cost of 
capital – were reviewed and challenged. The 
Committee considered the sensitivities to 
changes in assumptions and the adequacy of 
disclosures required by IAS 36 ‘Impairment of 
Assets’ in relation to the Group’s CGUs.
 
— The Committee is satisfied with the 
determination of cash generating units and 
the associated goodwill reallocation.
 
— The Committee is satisfied with the annual 
impairment review with confirmation of 
sufficient headroom in each of the cash 
generating units. 
 
— The Committee is satisfied with the 
disclosures relating to goodwill.
Going concern and viability
 
— The assessment of the Group’s viability 
and the appropriateness of the going 
concern assumption.
 
— The Committee reviewed future budgets and 
cash flow forecasts to understand the Group’s 
available liquidity and ability to continue as a 
going concern. The Committee reviewed and 
challenged the risks identified to the forecasts. 
The Committee reviewed the outcome of the 
severe but plausible scenario modelling and 
stress testing.
 
— The Committee is satisfied with the 
modelling process and the risks identified. In 
addition, the Committee is satisfied with the 
stress testing performed and the severe but 
plausible scenario modelling. The 
Committee noted that in all scenarios the 
Group had a high level of liquidity headroom 
and sufficient headroom against covenant 
requirements. 
 
— The Committee is satisfied with the 
assessment of the Group’s viability and is 
satisfied that the Group is a going concern.
 
— The Committee is satisfied with the 
disclosures related to going concern  
and viability.
Acquisitions and disposals
 
— Pearson disposed of its interests in its 
international courseware local publishing 
businesses, disposing of assets in French 
speaking Canada, Italy, Germany, South 
Africa and Hong Kong. In addition, 
Pearson announced a strategic review of 
its Online Program Management 
business. 
 
— Pearson acquired Credly Inc, increasing 
its ownership from 19.9% to 100%.
 
— Pearson acquired 100% of ATI STUDIOS 
A.P.P.S S.R.L (Mondly).
 
— The Committee reviewed the accounting for the 
disposal of the international courseware local 
publishing businesses with specific focus on 
consideration, net assets disposed and disposal 
costs. The Committee also reviewed tax 
assumptions relating to the disposal 
transactions. In addition, the Committee 
reviewed the judgement related to whether the 
results and cash flows of the disposed 
businesses should be classified and presented 
as discontinued operations by reference to the 
criteria set out in IFRS 5.
 
— The Committee reviewed the status of the 
strategic review of the Online Program 
Management businesses and considered this 
against the IFRS 5 criteria to be classified as 
held for sale.
 
— The Committee reviewed the accounting for the 
Credly and Mondly acquisitions with specific 
focus on the step acquisition accounting for 
Credly, consideration, net assets acquired 
including the valuation of intangibles and the 
recognition of goodwill. The Committee noted 
the use of third party valuation experts to value 
the acquired intangible assets.
 
— The Committee determined that disposal 
accounting for the international courseware 
local publishing businesses had been 
appropriately recorded. The Committee is 
satisfied with the judgement that the results 
and cash flows of the disposed businesses 
should not be classified and presented as 
discontinued operations and is also satisfied 
with the disclosures related to this item.
 
— The Committee also agreed that the IFRS 5 
criteria to be classified as held for sale in 
respect of the Online Program Management 
businesses had not been met as at 31 
December 2022.
 
— The Committee determined that the 
acquisition accounting for Credly and 
Mondly had been undertaken appropriately 
but notes that it remains provisional as at  
31 December 2022.
Audit Committee report continued
86 Pearson plc Annual report and accounts 2022
Issue
Action taken by Audit Committee
Outcome
Revenue recognition
 
— Pearson has a number of revenue 
streams where revenue recognition is 
complex. For some revenue streams 
significant judgements and estimates  
are required in order to determine  
the amount and timing of  
revenue recognition. 
 
— The Committee regularly reviews and 
challenges revenue recognition practices and 
the underlying assumptions and estimates. In 
addition, the Committee has visibility of internal 
audit findings relating to revenue recognition 
controls and processes and routinely monitors 
the views of external auditors on revenue 
recognition issues.
 
— The Committee is satisfied that revenue is 
being recognised appropriately. 
Property asset impairment reviews and classification
 
— Pearson holds significant right-of-use 
assets in relation to leased properties. 
The property portfolio has been further 
simplified, significantly reducing the 
square footage required. The right-of-use 
assets have consequently been impaired. 
In addition, assumptions made in 
previous years regarding the ability to 
sublet have been revisited. There are 
significant estimates and assumptions 
used in the impairment review.
 
— In light of the changes in use of 
Pearson’s property assets from own use 
to sublet, the classification of property 
assets has been assessed resulting in 
recognition of certain assets as 
investment property in 2022. 
 
— The Committee monitored the Group’s 
property strategy during the year to determine 
if there were impairment triggers. The 
Committee considered the results of the 
Group’s property impairment reviews with 
specific focus on the 80 Strand and Hoboken 
properties. Key assumptions – including 
potential rental value, expected sublease 
durations and terms such as rent free periods 
– were reviewed and challenged. The 
Committee considered the adequacy of related 
disclosures. The Committee noted the input of 
third party property specialists in determining 
the key assumptions. 
 
— The Committee reviewed the assessment of the 
property assets against the criteria to be 
classified as investment property.
 
— The Committee is satisfied with the results 
of the property impairment reviews and the 
subsequent impairment charges recognised 
in the income statement.
 
— The Committee is satisfied that the  
charges relate to a major restructuring 
programme and so meet the Group’s  
criteria to be excluded from adjusted 
performance measures. 
 
— The Committee is satisfied with  
the disclosures relating to  
property impairments.
 
— The Committee is satisfied with the decision 
to classify certain property assets as 
investment property and the disclosures 
relating to this classification.
Tax
 
— Pearson holds provisions in relation to 
uncertain tax positions. 
 
— In 2021, Pearson paid £105m (including 
interest) in relation to the EU state aid 
matter and at that time the amount was 
recognised as an asset as it was 
expected to be recovered in due course. 
In 2022, the EU General Court dismissed 
the appeal made by the UK Government 
in relation to this matter. As a result of 
the dismissal, Pearson have concluded 
that a provision is now required in 
relation to this issue.
 
— In 2022, Pearson have released tax risk 
provisions totalling £72m following the 
expiry of the statute of limitations for 
certain periods in the US.
 
— Changes to, and the application of, tax 
legislation continues to be a complex 
and judgemental area.
 
— The Committee considered various 
developments during the year, including 
Pearson’s ongoing response to the European 
Commission’s decision that the UK’s Finance 
Company Partial Exemption rules constituted 
state aid (‘EU state aid’). The Committee noted 
that the EU General Court dismissed the UK 
Government’s appeal in relation to the EU state 
aid matter and concur with management that a 
provision is now required for this item.
 
— The Committee reviewed the release of the  
tax risk provisions resulting from the expiry of 
the statute of limitations, including the 
presentation of these items within adjusted  
and statutory earnings. 
 
— The Committee is satisfied with Pearson’s 
approach to managing the impact of tax 
legislation changes and agreed with the 
views of management regarding tax 
provisioning levels.
 
— The Committee is satisfied with Pearson’s 
approach to the EU state aid matter 
including the provision made in relation to 
amounts paid in 2021 and ongoing 
disclosure about this matter.
 
— The Committee is satisfied with the release 
of US tax provisions and the presentation of 
the items within the income statement.
Investments in unlisted securities
 
— Pearson holds investments in unlisted 
securities. Historically, all of these 
investments have been classified as fair 
value through other comprehensive 
income. On further review of limited life 
funds the classification for certain funds 
has been changed to fair value through 
profit and loss. 
 
— The change in classification represents 
an error in the prior year accounts and 
prior year comparative numbers have 
been restated. 
 
— The Committee considered the classification of 
certain limited life funds held by Pearson and 
agreed with the reclassification.
 
— The Committee considered the need for 
restatement of prior year comparative  
numbers considering both quantitative and 
qualitative factors. 
 
— The Committee reviewed the disclosures 
relating to the restatement. 
 
— The Committee reviewed the control 
implications relating to this matter. 
 
— The Committee agreed with the 
reclassification of certain unlisted securities. 
 
— The Committee agreed with the requirement 
to restate comparative figures based on 
quantitative size but reviewed and agreed 
with management’s determination that the 
qualitative factors suggest this is not a 
material item to users of the accounts. 
 
— The Committee is satisfied with the 
accounting treatment in the current year 
and the disclosures related to the 
restatement of comparative figures. 
 
— The Committee were satisfied that the 
control deficiency has been remediated. 
Annual report and accounts 2022 Pearson plc 87

Directors’ remuneration report 
Key messages from the Remuneration 
Committee 
 
— During the year, the Committee undertook a 
comprehensive review of the Directors’ remuneration 
policy, which is due for its triennial renewal at the 2023 
AGM. Following extensive consultation with shareholders, it 
was determined that a conventional UK incentive structure 
would be retained but with modifications to quantum and 
enhancement of key UK governance features.
 
— The Committee also reviewed the implementation of the 
Directors’ remuneration policy for 2023, in particular the 
performance framework, to ensure it appropriately 
supports delivering Pearson’s forward-looking strategy. 
 
— The Committee spent significant time during the year 
considering the inclusion of strategic and ESG priorities in 
incentives and benefited from insights provided by Annette 
Thomas given her key role on Pearson’s Reputation & 
Responsibility Committee. We will introduce a new ESG 
metric into the LTIP and remove digital sales from the AIP. 
 
— As Committee Chair, I engaged extensively with shareholders 
and their advisers throughout 2022, and all feedback received 
was considered by the Committee when finalising the 
Directors’ remuneration policy and its implementation  
for 2023. 
 
— The Committee considered performance outcomes for 
2022. The annual incentive outcome for Executive Directors 
is 76% of maximum reflecting strong financial and strategic 
progress delivered in 2022. The long-term incentive granted 
in 2020 will vest at 58% of maximum considering the 
profitable growth and shareholder value created over the 
three-year performance period.
 
— A thorough review was conducted ahead of the release of the 
second tranche of the co-investment award for the Chief 
Executive, considering performance underpins, broader 
company performance, and stakeholders’ experience and it 
was determined that this tranche should vest in full.
 
— The Committee remains focused on ensuring remuneration 
policies and practice for all Pearson’s colleagues are 
consistent with our need to attract and retain the right 
talent for our digital future, and are appropriately aligned to 
our forward-looking strategy, our purpose, and our mission, 
vision, and values. 
 
— During the year, I engaged with colleagues on executive pay 
and wider reward matters through several channels, 
including the Employee Engagement Network.
Sherry Coutu - Committee Chair
Terms of reference
The Committee’s terms of reference are in line with the 2018 UK 
Corporate Governance Code and are available on the Governance 
page of our website at pearsonplc.com (a summary of the 
Committee’s responsibilities is on page 111).
Board Committee attendance
There were 7 scheduled meetings of the Remuneration Committee in 
2022. Attendance by Directors was as follows:
Committee members
Meetings attended
Sherry Coutu CBE
7/7
Esther Lee1
6/6
Tim Score
7/7
Sidney Taurel2
2/2
Annette Thomas3
3/3
1. Esther Lee joined the Remuneration Committee on 1 April 2022.
2. Sidney Taurel stepped down from Pearson’s Board and the Remuneration 
Committee at the AGM on 29 April 2022.
3. Annette Thomas joined the Remuneration Committee on 1 August 2022.
Dear Shareholder
On behalf of the Board, I am pleased to present the 2022 Directors’ 
remuneration report, which includes our 2023 Directors’ 
remuneration policy.
Pearson completed 2022 ahead of original expectations. The Group 
delivered a robust financial performance, with underlying sales up 
5% and an underlying increase in adjusted operating profit growth of 
11% as well as being on-track to deliver significant cost efficiencies  
in 2023. 
Pearson made strong strategic progress over the year, including 
reshaping the portfolio for growth, adding capabilities and increasing 
interconnectivity between divisions to unlock synergies and build 
further lifelong learning potential. The Company’s strong strategic, 
operational, and financial progress was reflected in the share price 
and value delivered to our shareholders. Pearson ended the year as 
one of the top performers in the FTSE 100, delivering a total 
shareholder return of over 50% in 2022. 
The work undertaken by Andy Bird and his new executive team over 
the last two years has ensured robust digital foundations for the next 
stage of Pearson’s journey which will enable new digital products and 
services to be brought to market at pace. Going forward, Pearson 
intends to capitalise on the momentum to date and continue to 
accelerate the growth of the business through its connected 
commercial and consumer strategy.
Directors’ Remuneration Policy review 
In line with the normal three-year cycle in the UK, Pearson’s Directors’ 
remuneration policy will be subject to shareholder vote at the 2023 
AGM. In advance of this, the Committee has spent significant time 
rigorously reviewing the Directors’ remuneration policy and its 
implementation to ensure it remains fit for purpose as Pearson looks 
to the future. This review considered Pearson’s renewed strategy, the 
strong performance of the business, and the views and expectations 
of our shareholders, their advisers, and other stakeholders. 
Andy Bird was appointed Chief Executive shortly after the approval of 
our existing Directors’ remuneration policy at the 2020 AGM. Under 
his leadership, Pearson attracted several new experienced individuals 
to lead the business and the whole organisation is energised and 
focused on executing our new strategy. Additionally, Pearson has 
moved from near the foot of the FTSE 100 to around 60th due to the 
significant increase in market cap during 2022.
88 Pearson plc Annual report and accounts 2022
The continued execution of the renewed digital-first strategy, through 
which Pearson aims to deliver innovative digital learning products 
through an integrated commercial and consumer strategy, demands 
a highly skilled and experienced management team. Attracting and 
retaining the correct calibre of talent has been and will remain crucial 
in accelerating the growth of the Company and ensuring it is well 
positioned to compete globally and capture market share.
North America is a key talent and growth market for Pearson and 
critical to the future success of the business. Pearson needs to be 
able to recruit and retain talent from this market, which generates 
two-thirds of Pearson’s total revenue, to deliver on its strategy. 
However, remuneration practices in the US differ significantly from 
the UK both in terms of quantum and structure, particularly with 
regard to long-term equity arrangements.
Highlighted by the appointment of Andy Bird, the Committee believes 
that the existing executive remuneration framework does not 
adequately act as an attraction, retention and incentivisation tool for 
US talent. To secure his appointment, the Committee developed a 
bespoke one-off co-investment award. This illustrates the challenges 
of recruiting in the US market, and the Committee is keen to ensure 
that the new Directors’ remuneration policy appropriately rewards 
the current Executive Directors, whose skills and experience will be 
particularly sought after for their contribution, while also containing 
additional flexibility to attract future talent if required over the 
three-year life of the Directors’ remuneration policy.
In this context, the Committee is proposing to implement a package 
of changes to the Directors’ remuneration policy and its 
implementation for 2023.
Initially, the Committee considered various alternative incentive 
frameworks, including a hybrid structure comprising both 
performance shares and restricted shares, which is very common in 
the US market, and operated by Pearson for senior management 
below Executive Director level. Feedback from some investors 
highlighted a continued preference for performance shares only, and 
so the Committee determined that a conventional UK incentive 
framework should be retained.
To support the attraction, retention and incentivisation of the critical 
executive talent needed to deliver the forward-looking strategy and 
ultimately the creation of long-term sustainable value for our 
shareholders and other stakeholders, the Committee is proposing to:
 
— adjust the percentage that pays out under the Annual Incentive 
Plan (AIP) and Long-Term Incentive Plan (LTIP) for threshold 
performance to 25% and 20% of maximum, respectively
 
— increase the Policy maximum opportunity level under AIP from 
200% to 300% of salary
 
— increase the Policy maximum opportunity level under LTIP from 
350% to 450% of salary.
For 2023, it is proposed that the Chief Executive will participate in the 
AIP and LTIP with maximum opportunity levels aligned to these 
increased maximums.  For the Chief Financial Officer, maximum 
opportunity levels for 2023 will be increased to 200% of salary for the 
AIP and 300% of salary for the LTIP (an increase from 170% and 
245% of salary, respectively). See page 94 for further details on the 
market data considered by the Committee in assessing pay 
competitiveness at Pearson.
The Committee believes that retaining a UK market-aligned 
remuneration framework for the forward-looking Directors’ 
remuneration policy, but with increased opportunity levels, is the 
best way to continue to drive a strong pay for performance culture 
and respond to the needs of the global talent market for digital 
innovators, whilst remaining mindful of the UK governance 
environment and the views of our shareholders.
Performance framework
While the Directors’ remuneration policy contains sufficient flexibility 
to adjust performance measures on an annual basis, the Committee 
took the opportunity as part of the Directors’ remuneration policy 
review to undertake a full review of the performance framework to 
ensure it continues to closely align to the forward-looking strategy. 
Overall, the Committee considered that current performance 
framework principles remain appropriate, although a number of 
changes to how this is implemented are being proposed for 2023.
Incorporation of ESG into the incentive framework
Pearson is a purpose-driven Company – we add life to a lifetime of 
learning through creating vibrant and enriching learning experiences 
designed for real-life impact, so everyone can realise the life they 
imagine. We believe learning is one of the greatest forces for change 
in the world, and as the world’s leading learning company, we have a 
duty to help drive that change and deliver against our purpose. The 
strategy and priorities for the business are therefore anchored 
around this, and everyday actions and behaviours have a strong 
social impact. 
The Committee spent a significant amount of time during the year 
debating the most appropriate ESG measures for inclusion in 
incentives. The strategic element of the AIP already includes relevant 
ESG priorities, and this will continue for 2023. In terms of specific ESG 
metrics, the AIP will include two targets for 2023 – one focused on 
investing in a diverse pipeline and increasing representation of 
employees from an ethnic minority background at management 
levels, and the other focused on achieving a step change towards our 
2030 carbon reduction goal. Reflective of the importance of 
delivering against our strategic commitments, the Committee chose, 
for the first time in 2022, to prospectively disclose annual 
performance targets in respect of strategic measures.  
A similar approach has been taken in respect of ESG measures  
for 2023. 
In addition to the AIP, taking on board feedback from our largest 
shareholders and reflecting the fact that progression of our ESG 
priorities is integral to long-term sustainable growth of the business, 
Pearson is introducing an ESG measure into the LTIP for 2023 with a 
weighting of 10%. For 2023, the ESG measure will centre on building 
an inclusive culture and increasing female representation at 
leadership levels.
When considering specific ESG measures for incentives, the 
Committee wanted to ensure strong relevance to the strategy and 
that measures should be quantifiable. Pearson is dedicated to 
creating bias-free content that reflects the diversity, depth, and 
breadth of all learners’ lived experiences. Within its content, Pearson 
acknowledges its responsibility to demonstrate inclusivity and 
incorporate diverse scholarship so that everyone can achieve their 
potential through learning. In this context, an ongoing focus on 
diversity, equality, and inclusion at all levels of the Company is 
important – embracing diversity throughout our own organisation will 
lead to a more diverse and representative Pearson product. The 
Committee therefore considers it appropriate that such metrics are 
included within both the AIP and LTIP. The focus of each measure 
does however differ – the AIP considers ethnicity across a broader 
management population, while the LTIP is focused on female 
representation in leadership roles.
Proposed changes to other measures
For the AIP, it is proposed that the operating cash flow measure, 
which has a weighting of 20%, is replaced with a free cash flow 
measure. Free cash flow is a measure preferred by some investors as 
it better corresponds to the cashflows available to return to them. 
The introduction of this measure reflects the importance of free cash 
flow generation to Pearson’s fundamental value, and ensures 
executives are incentivised to improve it. 
Annual report and accounts 2022 Pearson plc 89

The digital sales metric which formed part of the strategic AIP 
measures in prior years will be removed for 2023. Considering the 
growth in digital and digitally-enabled sales over the last five years, 
and that this now accounts for around three quarters of total sales, 
the Committee, with input from key shareholders, determined that 
including both a sales metric and a digital sales metric within the AIP 
was no longer appropriate. The strategic element of the AIP will 
therefore focus solely on ESG measures for 2023, at the same 
weighting as in 2022 (10% of the total AIP). 
For 2023, in response to the removal of digital sales, the weighting of 
the adjusted operating profit measure will be increased to 40% to 
further incentivise the drive for profitable growth. The Committee did 
consider whether to include an additional strategic measure in place 
of digital sales, for example, a measure related to consumer 
engagement or product effectiveness. It was however determined 
that further work was required to ensure a sufficiently robust metric 
which could be linked to incentives, although the current intention  
of the Committee is that such a metric will be incorporated in  
future years. 
Overall, therefore, for 2023, the AIP will be based 40% on adjusted 
operating profit, 30% on sales, 20% on free cash flow and 10% on 
strategic ESG measures. In line with normal practice, the Committee 
will review its approach in advance of each financial year to ensure 
that the balance of performance measures remains appropriate and 
aligned to the financial and strategic priorities of the Group. 
For the LTIP, the majority of the awards will continue to be based on 
adjusted EPS, relative TSR and a return measure, with these three 
measures equally weighted at 30% each. The introduction of the new 
ESG measure, as described above, accounts for the remaining 10%. It 
is however proposed that, from 2023, Return on Capital replace net 
ROIC as the return measure. Return on Capital is considered a more 
appropriate and simpler measure for the business in terms of 
measuring how efficiently returns are generated from our asset base 
and is more consistent with the approach taken by other companies 
in the market. 
The Committee also carefully considered the peer group against 
which to measure relative TSR performance, reflecting on whether a 
bespoke peer group, international index or a sector-specific index 
should be used instead of or alongside the FTSE 100. Initially, it was 
determined that the FTSE 100 should be retained given its simplicity, 
the fact that Pearson is a constituent of the FTSE 100 and subject to 
similar market dynamics as other global UK-listed companies. 
Further, the Committee was mindful of the challenges of identifying 
either an appropriate bespoke peer group or a defined sector group 
or index which adequately reflects Pearson’s business mix and 
UK-listing.
However, during the shareholder consultation exercise, it became 
clear that shareholders held a broad range of views in relation to the 
most appropriate TSR comparator group for Pearson. Whilst it was 
generally recognised there is no “perfect” comparator group, some 
preferred the simplicity of the FTSE 100 whilst others thought an 
international or sector-specific comparator group would more closely 
reflect Pearson’s strategic ambition. The Committee therefore 
re-visited its initial deliberations, and to balance the various 
perspectives, it has ultimately been determined that a hybrid 
approach will be taken – 50% of the TSR element will continue to be 
measured relative to the FTSE 100 while the other 50% will be 
measured relative to the S&P 500. For both the FTSE 100 and S&P 
500, certain sectors – financial services, energy, basic materials, 
utilities and healthcare – will be excluded as companies within these 
sectors are subject to very different market forces to Pearson and 
are therefore not considered relevant comparators.
Target-setting for 2023
One of Pearson’s remuneration principles, which apply across the 
whole organisation, centres on pay for performance, and this is 
actively considered by the Committee when determining targets. For 
2023, in line with usual practice, a robust target-setting process has 
been followed considering Pearson’s strategic plan as well as analyst 
consensus to reflect market expectations. 
This year, the Committee also considered the increased opportunity 
levels under the Directors’ remuneration policy to ensure that any 
pay-out will appropriately reflect the performance delivered and 
ultimately value created for our shareholders. For maximum pay-out, 
performance must be significantly in excess of current market 
guidance. Overall, the Committee believes that the 2023 LTIP targets 
are appropriately stretching in the context of the business and 
external environment and would only result in significant value 
delivered to management where there has been significant value 
created for shareholders and other stakeholders. See page 99 for full 
details of 2023 LTIP targets.
The Committee has a strong focus on pay for performance and a 
robust track record of setting stretching targets, as demonstrated by 
the targets set in recent years and subsequent incentive outcomes. 
The approach taken this year is no different.
Shareholder engagement 
Over the last year, as part of the Directors’ remuneration policy 
renewal, the Committee has engaged extensively with shareholders 
and shareholder representative bodies. I would personally like to 
take this opportunity to thank all those who took the time to engage 
with us and provided feedback on the executive remuneration 
approach at Pearson. As always, your feedback is invaluable. 
Since the introduction of the one-off co-investment award, which was 
designed to secure the appointment of Andy Bird, a significant 
minority of shareholders have continued to vote against Pearson’s 
remuneration resolutions, including the 2021 Directors’ 
Remuneration Report at the 2022 AGM. The Committee is naturally 
disappointed with this outcome, but equally is committed to ensuring 
Pearson has an executive remuneration framework which allows it to 
be competitive. 
When developing the new Directors’ remuneration policy, the 
Committee took a phased approach to shareholder engagement, 
initially seeking the views of our major shareholders on the direction 
of travel, before building out more detailed proposals. These initial 
conversations with shareholders in June and July 2022 resulted in the 
Committee deciding to retain the existing incentive framework rather 
than pursue an alternative. 
Overall, the Committee received feedback from, or directly engaged 
with, approximately 55% of Pearson’s ownership as well as the key 
proxy advisors. We highly value the inputs and views of all 
shareholders and their advisors and have taken these into account 
when finalising our approach. It is worth highlighting, however, that 
throughout the engagement process we received a broad range of 
feedback, with the views of individual shareholders often differing, 
and as a result it is not necessarily always possible to meet the 
preferences of all shareholders. 
In my conversations, there was a general understanding of the 
challenges faced by Pearson – the need, despite being a UK-listed 
company, to develop an executive remuneration framework which 
adequately acts as an attraction, retention and incentivisation tool for 
US talent given that North America is a key talent and growth market 
for Pearson, and critical to its future success. That said, the 
engagement exercise highlighted specific areas of concern for some 
shareholders, and reflective of this, the Committee has modified its 
proposals. This includes:
 
— Introduction of annual bonus deferral. In response to 
shareholder feedback, the Committee determined to introduce 
annual bonus deferral where an Executive Director has not yet 
met the relevant shareholding guideline. In such circumstances, it 
is proposed that an Executive Director would defer a third of any 
bonus earned into an award of Pearson shares for two years.
 
— Increase in shareholding guidelines in line with increased LTIP 
opportunity. Several shareholders noted that considering the 
proposed increase in LTIP opportunity they would expect a 
corresponding increase in shareholding guidelines, strengthening 
the alignment of Executive Director interests with those of 
shareholders. The Committee is therefore proposing that 
shareholding guidelines will increase to 450% of salary for the 
Directors’ remuneration report continued
90 Pearson plc Annual report and accounts 2022
Chief Executive Officer and 300% of salary for the Chief Financial 
Officer, in line with the proposed annual LTIP award levels. 
 
— Reduction of LTIP threshold to 20% of maximum. Our original 
proposal was to increase the LTIP percentage that pays out for 
threshold performance to 25% of maximum for all measures in 
line with market norms. However, combined with an increase in 
the maximum LTIP opportunity to 450% of salary, this resulted in 
a threshold vesting level in excess of 100% of salary. Mindful of 
the higher opportunity level, but in line with the original intention 
to align the threshold vesting percentage across all long-term 
metrics, the Committee is now proposing to reduce threshold 
vesting to 20% of maximum. This will mean that for threshold 
performance, LTIP vesting would be 90% of salary for the CEO as 
opposed to 112.5% of salary.
 
— Re-balancing of LTIP measures. Shareholders expressed a 
range of views in relation to long-term performance measures, 
particularly in relation to our original proposal to reduce the 
weighting of Return on Capital in favour of TSR and EPS. Mindful 
of this feedback and the focus on capital allocation as Pearson 
looks to grow for the future, the Committee determined that TSR, 
EPS and Return on Capital should be equally weighted within  
the LTIP.
Shareholder feedback also informed the Committee’s decisions in 
relation to the TSR comparator group and Executive Director salary 
increases for 2023.
Pearson remains committed to a constructive and positive 
relationship with all its shareholders and their advisers and will 
continue to engage widely as appropriate going forward. 
Incentive outcomes for 2022 
2022 AIP and 2020 LTIP
The strong financial and strategic progress delivered in 2022 resulted 
in a formulaic AIP outcome for Executive Directors of 76% of 
maximum. Overall, the Committee was satisfied that the formulaic 
outcome was reflective of the performance achieved.
The LTIP granted in 2020 will vest in 2023 at 58% of maximum 
reflecting profitable growth and shareholder value created over the 
three-year performance period. Only the Chief Financial Officer 
participated in this award, and shares vesting will remain subject to a 
two-year holding period.
As disclosed in the 2020 Directors’ Remuneration Report, mindful of 
the share price volatility at the time the 2020 LTIP was granted, the 
Committee exercised its discretion to use a five-day average share 
price to 1 March 2020 (573.72p) rather than the share price prior to 
the date of grant in May (459.80p). This resulted in approximately 
55,000 fewer shares being granted to the Chief Financial Officer. 
The Committee considered that the overall vesting outcome reflected 
the performance of the business over the three-year period, in 
particular the success of the new strategy, and therefore no further 
discretion was applied.
Second tranche of the Chief Executive’s  
co-investment award 
The second tranche of the one-off co-investment award granted to 
Andy Bird to secure his appointment vested following 31 December 
2022. Vesting was subject to achievement of performance underpins 
linked to strategic progress and there being no significant ESG issues 
resulting in significant reputational damage. These underpins are 
intended to guard against payment for failure, ensuring the 
Committee can reduce vesting if in its opinion the performance of 
the business or the individual does not support this.
The Committee undertook a rigorous assessment of the relevant 
performance underpins as well as a holistic review of broader 
Pearson performance and the experience of all stakeholders. 
In its assessment, the Committee followed the framework developed 
and disclosed in prior years. Overall, the Committee determined  
that the second tranche of the award would vest in full and full 
disclosure of the Committee’s deliberations in this regard is on 
pages 103 and 104.
Shares vesting remain subject to a holding period until 31 December 
2023. The final tranche of the award will vest following 31 December 
2023 subject to the relevant performance underpins, which include 
an additional TSR underpin, and Andy Bird’s continued employment 
at the vesting date.
Salaries for 2023
For 2023, salary levels for Executive Directors were considered in the 
context of general economic and market conditions, the level of 
increases made across the Company as a whole, and individual 
performance. In addition, the Committee recognised that Andy Bird 
had not had an increase in his salary since his appointment in 2020 
and that, from an overall package perspective, his remuneration is 
significantly below US levels. Mindful of this, and the exceptional 
performance of the Company since his appointment, the Committee 
felt that it would have been warranted to increase Andy Bird’s salary 
significantly, and consulted with shareholders on this basis.
However, cognisant of the current external environment, which over 
the last year has steadily become more challenging for our broader 
employee population who are more exposed to high levels of 
inflation and the associated cost-of-living pressures, and shareholder 
feedback and guidance in this area, the Committee determined that 
the salary increase for Andy Bird should be 3.5%, in line with the 
average salary increase awarded to the US workforce and below the 
average rate for the UK workforce and Pearson as a whole. 
The salary for the Chief Financial Officer will be increased by 4% in 
line with the average increase for the UK workforce.
Remuneration across Pearson
Pearson’s remuneration principles are consistent across the 
organisation and are designed to support Pearson’s culture and to 
make Pearson an employer of choice and able to attract and retain 
talent to execute our digital-first strategy. Remuneration across the 
workforce is designed to reflects the role, skills and experience, and 
performance of any relevant individual as well as local market 
practice. Many of the features of our Directors’ remuneration policy 
apply more broadly, for example, over half of all Pearson employees 
(c.11,200 employees) participated in an AIP during 2022 which was 
funded based on similar performance measures as used for 
Executive Directors. 
Mindful of the energy crisis which has had a disproportionate impact 
on Pearson’s lowest paid employees in the UK and elsewhere in 
Europe, Pearson made a one-off cost-of-living payment equal to 
£1,000 or €1,000 to these individuals at the end of 2022. As a global 
company, Pearson monitors the impact of external worldwide events 
on pay competitiveness and makes adjustment where appropriate  
to ensure employees are rewarded fairly for their contribution, for 
example, targeted pay solutions have been implemented in  
markets suffering from acute inflationary pressures such as Sri Lanka 
and Turkey. 
The Committee receives regular updates on talent matters and wider 
workforce considerations and actively considers the approach to 
reward throughout the organisation when determining executive 
remuneration. In addition, the Committee closely reviews relevant 
pay ratios and pay gaps and supports efforts to make progress 
against these metrics. Last year, to ensure a more proactive 
approach and enable a two-way conversation, the Employee 
Engagement Network held a discussion on reward and incentives  
at Pearson. The EEN met to discuss how the annual bonus plan  
is funded and how we seek to achieve alignment between  
Executive Directors and the wider workforce through the use of 
consistent measures.
I would like to thank shareholders for their continued support at the 
2023 AGM in relation to both our 2022 Directors’ remuneration 
report and 2023 Directors’ remuneration policy.
Sherry Coutu, CBE
Chair of Remuneration Committee
Annual report and accounts 2022 Pearson plc 91

1
Aligned to 
longer-term 
strategy
Reward is linked to 
achieving Pearson’s 
longer-term 
strategy, growth, 
and sustainability
2
Pay for 
performance
Remuneration 
framework and 
outcomes are 
aligned with 
performance
3
Market 
competitive
Pay levels are 
market competitive, 
based on role, 
grade, and 
contribution, and 
ensure individuals 
are fairly rewarded 
in line with the 
market
4
Targeted 
differentiation
We operate 
targeted 
differentiation 
of reward across 
our employees, 
linked to talent 
and performance 
management
5
Tailored
Our approach 
to reward is tailored 
in certain 
circumstances to 
address a specific 
market/business 
need, and is 
consistent with our 
underlying reward 
philosophy
6
One part of the 
employee value 
proposition
Remuneration is 
one part of our 
broader employee 
value proposition 
– and not the only 
reason to work for 
Pearson
Pearson’s Remuneration 
Framework At a Glance
Our Directors’ remuneration policy and its implementation supports 
our Company purpose of adding life to a lifetime of learning, our 
strategy and ultimately the delivery of long-term sustainable value 
for all stakeholders, including our shareholders.
In developing the forward-looking Directors’ remuneration policy, 
the Committee had due regard to the principles outlined within 
the UK Corporate Governance Code.
 
— Pearson’s remuneration principles, as set out above, align with 
our culture and position us as an employer of choice, so we can 
continue to attract and retain the right talent, and support our 
digital future. We recognise that remuneration is only one part 
of Pearson’s employee value proposition 
 
— Our forward-looking executive remuneration framework is 
designed to be simple, with total remuneration made up of  
fixed and performance-linked elements, supporting different 
strategic objectives
 
— Our remuneration framework and outcomes are designed to be 
aligned with performance:
 
— Selected performance measures for the AIP (Annual Incentive 
Plan) and LTIP (Long-Term Incentive Plan) are key to achieving 
the Group’s strategic objectives. The Committee reviews 
performance measures annually to ensure they incentivise 
appropriate management behaviours and goals 
 
— The Committee carries out a robust target-setting process 
each year, considering Pearson’s strategic plan, as well as 
analyst consensus to reflect market expectations. This results 
in stretching, yet achievable, AIP and LTIP targets 
 
— Maximum awards under the AIP and LTIP are capped and 
clearly disclosed in our Directors’ remuneration policy 
alongside predictions of how the Directors’ remuneration 
policy may apply in various performance scenarios
 
— When determining pay-outs, the Committee considers 
whether the outcome reflects overall company performance 
and the experience of stakeholders over the period, including 
shareholders and colleagues. If not, it has the discretion to 
adjust outcomes
 
— The Committee is mindful of reputational and other risks 
when implementing the forward-looking Directors’ remuneration 
policy and determining outcomes for Executive Directors and 
senior management. Pearson has safeguards in place, such as 
malus and clawback provisions and a two-year LTIP holding 
period, as well as robust shareholding guidelines, which extend 
post-employment. 
 
— Before signing off the Directors’ remuneration report, the 
Committee reviews drafts and inputs to clarify our disclosures. 
In renewing the Directors’ remuneration policy this year, the 
Committee engaged extensively with shareholders to ensure 
they fully understood the rationale for change, and to give them 
the opportunity to feed into the decision-making process and 
inform final conclusions.
Remuneration principles 
Pearson’s remuneration principles govern pay for the whole organisation. We have developed remuneration arrangements for our Executive Directors 
with these principles in mind. 
Directors’ remuneration report continued
92 Pearson plc Annual report and accounts 2022
The 2023 Directors’ remuneration policy will be subject to shareholder approval at the AGM to be held on 28 April 2023. This section outlines key 
changes to the Directors’ remuneration policy following the Remuneration Committee’s extensive review over the last year. The 2023 Directors’ 
remuneration policy is set out in full on pages 112 to 119.
Key changes to Directors’ remuneration policy
Key features of the 2020 Directors’ remuneration policy
Outline of proposed changes for 2023
Salary
Base salaries reflect level, role, skills, experience, the competitive 
market and individual contribution.
Base salaries are normally reviewed annually, with any increases 
normally in line with typical increases awarded to other  
Group employees.
No changes to policy
Allowances and 
benefits
Reflects the local competitive market and may include travel-
related, health-related and risk-related benefits as well as any 
other benefits provided to the majority of employees.
The Committee may introduce other benefits if it is considered 
appropriate to do so.
No changes to policy
Retirement 
benefits
Employees in the UK, including Executive Directors, are eligible  
to join the Money Purchase 2003 section of the Pearson  
Pension Plan. 
The Committee has discretion to put in place retirement benefit 
arrangements in line with local market practice. 
Executive Directors, who opt out of the pension, can receive a 
cash allowance of up to 16% of base salary, in line with the 
maximum company contribution as a percentage of salary that 
UK employees of a similar age are eligible to receive. 
No changes to policy
Annual 
incentive
Maximum opportunity of 200% of base salary.
Based on the achievement of annual business goals and strategic 
objectives, with financial metrics accounting for at least 75% of 
total opportunity.
Normally no payout for threshold performance, with 50% payable 
for on-target performance.
Discretion to adjust formulaic outcome where this does not 
reflect underlying performance.
Awards paid fully in cash.
Malus and clawback provisions apply. 
Increase in maximum opportunity to 300% of base 
salary. For 2023, maximum opportunities are: 
 
— 300% for the Chief Executive 
 
— 200% for the Chief Financial Officer 
Increase in payout for threshold performance to 25%  
of maximum.
Introduction of bonus deferral where shareholding 
guidelines have not been met.
Long-term 
incentive
Maximum opportunity of 350% of base salary.
Based on achievement of targets for earnings per share, a return 
on measure and relative total shareholder return (weighted 
equally) over a three-year performance period. 
Discretion to adjust formulaic outcome where this does not 
reflect underlying performance.
Awards are subject to a post-vesting holding period of two years. 
Malus and clawback provisions apply.
Increase in maximum opportunity to 450% of base 
salary. For 2023, maximum opportunities are: 
 
— 450% for the Chief Executive 
 
— 300% for the Chief Financial Officer 
Proportion of award that vests for threshold aligned 
at 20% across all performance measures.
Introduction of ESG into the performance framework. 
Shareholding 
guidelines
Current in-employment guidelines of:
 
— 300% for the Chief Executive 
 
— 200% for the Chief Financial Officer 
Post-employment shareholding guidelines apply. 
Increase in in-employment guidelines 
in line with increase LTIP opportunity:
 
— 450% for the Chief Executive 
 
— 300% for the Chief Financial Officer 
2023 Directors’ Remuneration Policy
Annual report and accounts 2022 Pearson plc 93

Consideration of market data in assessing pay competitiveness at Pearson
In determining the 2023 Directors’ remuneration policy proposals and their implementation, the Remuneration Committee considered remuneration 
levels at comparable companies both in the UK and US. The approach to market data was to consider multiple different reference points, including 
those described below, to provide a rounded view of overall positioning against the market. The Committee has not sought to follow any specific 
market reference and is mindful that, whilst the primary talent market is likely to continue to be the US, Pearson is a UK-listed company 
and operates a UK market aligned remuneration framework.
Market reference points
Directors’ remuneration report continued
 
— Executive Director remuneration in UK-listed companies of a similar market capitalisation to Pearson, the FTSE 41 to 100. This comparator 
group recognises Pearson’s London listing, the fact that Pearson is a member of the FTSE 100, and that UK investors and proxy agencies 
would likely consider competitiveness of remuneration levels at Pearson in this context primarily. Pearson is currently positioned c.60th in 
the FTSE 100 (based on a three-month average market capitalisation). Market data for the FTSE 100 as a whole was also considered as an 
additional reference point given Pearson’s growth in 2022.
 
— Executive Director remuneration in US-listed companies of a broadly similar financial size and in a similar sector to Pearson. This 
comparator group included companies in the broadcasting, interactive media and software sector with similar revenue to Pearson. It 
considers what Executive Directors are paid in broadly similar US-listed companies, although it does not directly align to Pearson’s  
talent market.
 
— Remuneration in US-listed companies more closely aligned to Pearson’s talent market and strategic ambitions. This comparator group 
comprised US technology, communications, and consumer discretionary companies, in particular those that are at the forefront of 
transformative, innovative plays within technology and digital, based on the Nasdaq-100 Index. Recognising, however, that many of these 
companies were materially larger than Pearson in terms of financial size, rather than considering remuneration levels for the CEO role, the 
market data considered was for roles reporting into the CEO (primarily heads of business units or Chief Executives of subsidiary 
businesses) which is analogous to Andy Bird’s previous executive role. This data was only considered in respect of the CEO role at Pearson.
The Committee is mindful of the views of many investors in relation to setting executive pay solely based on market data as well as views on using 
international peer groups. The Committee therefore wanted to take a balanced and thoughtful approach which incorporates the views of all key 
stakeholders. 
94 Pearson plc Annual report and accounts 2022
Illustrations of application of the 2023 Directors’ remuneration policy in different performance scenarios
Chief Executive (Andy Bird) $000
Chief Financial Officer (Sally Johnson) £000
100%
29%
17%
13%
29%
33%
27%
43%
50%
40%
20%
$1,949
$6,800
$11,652
$14,563
Fixed Pay
AIP
Share price appreciation
LTIP
Maximum
Maximum plus 
50% share price 
appreciation 
Minimum 
Target
100%
32%
19%
15%
27%
32%
26%
41%
48%
39%
20%
£662
£2,055
£3,449
£4,284
Maximum
Maximum plus 
50% share price 
appreciation 
Minimum 
Target
Fixed Pay
AIP
Share price appreciation
LTIP
Pay positioning
Overall, the intention of the Committee was to ensure a package for the Chief Executive which was competitive considering Pearson’s primary talent 
market. While it is acknowledged the proposed package for the Chief Executive is towards the top end of market practice from a UK perspective, it is 
within the broad range of pay received by executives below CEO level at relevant US-listed companies whom Pearson might look to approach for future 
Executive Director roles – total compensation for such roles typically ranged c.$4m to c.$11m at target. This is still well below that of CEOs at similarly 
sized US companies.
Chief Executive Officer
Chief Financial Officer
UK positioning
US positioning
UK positioning
US positioning
Salary
Towards the top end of  
UK practice
Within US market 
competitive range 
for CEO roles
Within UK market 
competitive range
Within US market 
competitive range
Annual bonus 
opportunity
For CEO roles, the market data illustrated that annual bonus opportunity levels in the US were around double 
opportunity levels in the UK. The same picture is not however true for other executive roles, where annual bonus 
opportunity in the US is more closely aligned to, although still marginally higher than, UK levels.
Towards the top end of  
UK practice
Within US market 
competitive range
Within UK market 
competitive range
Within US market 
competitive range
LTIP opportunity
Long-term incentive opportunity is the key driver in the difference between UK and US remuneration levels. Opportunity 
levels in the US are many multiples of UK levels. For CEO roles in US-listed companies in a similar sector and of a similar 
financial size to Pearson, many receive long-term incentives with a target opportunity greater than 1000% of salary.
Towards the top end of  
UK practice
Substantially below 
US levels
Towards the top end of  
UK practice
Substantially below 
US levels
Conclusions
The market data highlighted the stark difference in pay practices between the UK and US, and the Remuneration Committee applied careful  
judgement when considering how remuneration at Pearson should be positioned taking into account the various reference points as well as the  
views of shareholders.
The Committee determined, with input from shareholders, that the incentive framework at Pearson for Executive Directors should continue to align to 
typical UK practice, and as such incentives remain fully performance-linked, which is not typically the case in the US market where often a significant 
proportion of the long-term equity award is delivered in restricted stock with no performance conditions and over shorter time horizons. In addition, 
annual bonus deferral and additional holding periods on LTIP awards are uncommon in the US market.
Overall, while it is acknowledged that the 2023 Directors’ remuneration policy proposals and their implementation position Pearson 
towards the top-end of the UK market, the Committee has not sought to match US quantum levels or market practice in terms of incentive 
design or the overall remuneration framework.
Annual report and accounts 2022 Pearson plc 95

Directors’ remuneration report continued
Discretion framework
When determining performance outcomes, the Remuneration Committee has the ability to adjust payments up or down if it believes that the outcome 
does not reflect underlying financial or non-financial performance or if such other exceptional factors warrant doing so. In making this determination 
the Remuneration Committee applies the following framework.
Formulaic outcome 
considering 
performance versus 
existing targets  
and underpins
Is this consistent 
with overall 
Company 
performance?
Is this consistent 
with the wider 
stakeholder 
experience?
Are there any 
significant culture, 
ESG or operational 
issues to be 
considered?
Are there any 
one-off or 
exceptional events 
to be taken into 
consideration?
Are outcomes 
appropriate or 
should an 
adjustment be 
considered?
Alignment of performance framework to Pearson’s strategy
Annual 
Incentive Plan
Adjusted Operating Profit (40%)
A key financial performance indicator reflecting the underlying 
operational performance of the Group, and measuring Pearson’s 
ability to reinvest.
 Increased weighting for 2023
Sales (30%)
A key financial performance indicator and measure of  
top-line growth. 
Free Cash Flow (20%)
A key financial performance indicator reflecting the importance of 
Free Cash Flow generation to Pearson’s fundamental value, and 
ensures executives are incentivised to improve cash flow.
 Replacing operating cash flow for 2023
Strategic measures (10%)
Specific objectives and targets selected annually to reflect 
relevant strategic priorities of the Group at the time. For 2023, 
this strategic element will focus on Pearson’s ESG priorities, in 
particular increasing representation of employees from an ethnic 
minority background at management levels and achieving a step 
change towards Pearson’s 2030 carbon reduction goal. 
 Reduced weighting for 2023
Long-term 
Incentive Plan
Relative TSR (30%)
Total Shareholder Return (TSR) is a measure of value created for 
our shareholders. Following a review of the peer group against 
which TSR is assessed, a hybrid approach will now be used to 
better reflect Pearson’s strategic ambitions. For 2023, TSR will be 
measured relative to: 
 
— 50% versus FTSE 100 (excluding certain sectors)
 
— 50% versus S&P 500 (excluding certain sectors)
Companies within financial services, energy, basic materials, 
utilities and healthcare sectors will be excluded as these are 
subject to very different market forces to Pearson and therefore 
not considered relevant comparators. 
 Changes to TSR peer group for 2023
EPS (30%)
A key financial performance indicator used by management to 
evaluate performance and by investors to more easily, and 
consistently, track the underlying operational performance of the 
Group over time. 
Return on Capital (30%)
A key financial performance indicator measuring how efficiently 
Pearson generates returns from its asset base. This is considered 
a more appropriate and simpler measure for the business 
compared to net ROIC, and more consistent with the approach 
taken by other companies in the market.
 Replacing net ROIC for 2023
ESG (10%)
Pearson is a purpose-driven Company, and everyday actions and 
behaviours have a strong social impact. Progression of our ESG 
priorities is integral to long-term sustainable growth of the 
business. For 2023, the ESG measure will centre on building an 
inclusive culture and increasing female representation at 
leadership levels
 Introduced for 2023
96 Pearson plc Annual report and accounts 2022
Performance in 2022
A year of strategic and operational progress
Revenue 
£3,841m
5% underlying 
adjusted growth 
on prior year
Strategic highlights
 
— Significant organic investment, bringing new capabilities
 
— Acquisitions, including Mondly and Credly to support growth across the Pearson ecosystem
 
— Completion of the strategic disposal of Pearson’s International Courseware local publishing businesses
 
— Launch of 18 study channels on Pearson+
 
— Launch of new people strategy with a focus on engagement and high-performance
 
— Announcement of £120m of cost efficiencies, accelerating improved margin
Adj. operating profit 
£456m
11% underlying 
adjusted growth 
on prior year
Operating cash flow 
£401m
3% growth 
on prior year
Adjusted EPS 
51.8p
48% growth 
on prior year
Net debt  
£557m
59% increase 
on prior year due 
to £350m share 
buy back 
Dividend per share  
21.5p
5% increase 
on prior year
Generation of significant returns for shareholders
Pearson TSR performance versus FTSE 100 over 2022 
Pearson TSR
FTSE 100
June
July
August
September
October
November
December
January
80
100
120
140
160
180
February
March
May
April
Executive remuneration outcomes for 2022
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
Actual
Target
Chief Executive
$3,798k
$3,148k
Fixed pay
Annual bonus
LTIP
‘22
Actual
Target
£0
£1,000,000
£2,000,000
£3,000,000
Chief Financial Oﬃcer
Fixed pay
Annual bonus
LTIP
£2,504k
£2,102k
Note 1: Target assumes AIP and LTIP outcome at 50% of maximum. 
Note 2:The vesting of the second tranche of the Chief Executive’s co-investment award is not included in the above illustration.
Annual report and accounts 2022 Pearson plc 97

Directors’ remuneration report continued
Implementation of executive remuneration framework for 2023
Base salary
Andy Bird – $1,293,750 (3.5% increase)
Sally Johnson – £557,225 (4% increase)
The salary increase for the Chief Executive is line with the average salary increase awarded to the US workforce and 
below the average level for the UK workforce. The salary increase for the Chief Financial Officer is in line with the 
increase for the UK workforce.
Allowances and benefits
No change for 2023. 
Executive Directors will continue to receive travel, health, and risk-related benefits. Andy Bird will also receive a 
contribution towards accommodation costs.
Retirement benefits
For 2023, both the Chief Executive and Chief Financial Officer will receive a cash allowance of 16% of salary in lieu of 
pension. This is aligned with the pension provision that UK employees of a similar age are eligible to receive.
As described in relation to the Committee’s review of the remuneration policy for 2023, Pearson has retained a UK 
remuneration framework for Executive Directors which does not reflect US practice in terms of plan design or pay 
levels. It is therefore considered appropriate that a consistent UK approach is applied with regard to pensions for 
the CEO. For US employees below Board level, whilst pension arrangements are in line with local practice, Pearson 
adopts US pay practices more broadly – such as grants of restricted shares in addition to performance shares – 
which we do not for Executive Directors.
Annual incentive plan
Maximum opportunities of: 
 
—
300% of base salary for the Chief Executive 
 
—
200% of base salary for the Chief Financial Officer 
For 2023, the following balanced mix of financial and strategic measures will be used to determine any pay out,  
with a third of any bonus paid deferred into shares for two years if an Executive Director has not met their 
shareholding guideline.
Adjusted operating profit
Sales
Free cash flow
Strategic measures
40%
30%
20%
10%
Strategic targets are as follows: 
Weighting
Threshold
Target
Maximum
Invest in diverse 
pipeline and 
increase BIPOC/
BAME 
representation at all 
manager levels
5%
2% increase in 
representation of 
BIPOC/BAME 
employees at 
Manager level and 
above
+ maintain overall 
gender parity as an 
underpin
5% increase in 
representation of 
BIPOC/BAME 
employees at 
Manager level and 
above
10% increase in 
representation of 
BIPOC/BAME 
employees at 
Manager level and 
above
Reduce carbon 
footprint – net 
annual reduction 
versus 2022 
baseline as step 
towards 2030 goal
5%
1% reduction
2% reduction
5% reduction
As in previous years, we will apply a financial underpin to the strategic measures. We will disclose financial targets in 
full retrospectively following the end of the performance period. 
 
98 Pearson plc Annual report and accounts 2022
Implementation of executive remuneration framework for 2023 continued
Long-Term 
Incentive Plan
Maximum opportunities for Executive Directors are: 
 
—
450% of base salary for the Chief Executive 
 
—
300% of base salary for the Chief Financial Officer
Performance measured over three years, with any shares vesting subject to an additional two-year holding period. 
For 2023, performance measures and targets are as follows:
% of 
total
Threshold
Stretch
Maximum
Payout at 
threshold
Payout at 
stretch
Payout at 
maximum
Adjusted EPS
30%
53.0p
63.0p
68.0p
20%
65%
100%
Return on 
Capital 
30%
8.5%
10%
11.5%
20%
65%
100%
Relative TSR vs. 
FTSE 100 (excl. 
certain sectors)
15%
Median 
-
Upper quartile
20%
-
100%
Relative TSR vs.  
S&P 500 (excl. 
certain sectors)
15%
Median
-
Upper quartile
20%
-
100%
ESG
10%
Improve gender 
representation 
at leadership 
levels overall  
vs 2022  
(VP and above)
Achieve gender 
parity at 
leadership 
levels in 
aggregate  
(VP and above)
Achieve gender 
parity at all 
leadership 
levels  
(VP and above)
20%
65%
100%
Note 1: 2023 LTIP targets have been set at an USD:GBP exchange rate of 1.21.
Note 2: Companies within financial services, energy, basic materials, utilities and healthcare sectors will be excluded from both TSR groups.
Shareholding 
guidelines
Shareholding guidelines are:
 
—
450% of salary for the Chief Executive 
 
—
300% of salary for the Chief Financial Officer
Annual report and accounts 2022 Pearson plc 99

Workforce remuneration  
at Pearson 
The Committee takes seriously its responsibilities concerning the oversight of remuneration policies and practices for the wider organisation. Our 
remuneration principles are consistent for all our colleagues, and applied depending on business need, level, and geography.
The key difference in our executive remuneration, compared to the approach to remuneration across our workforce, is that remuneration for our 
Executive Directors is more heavily weighted towards variable pay and linked to the delivering of strategic objectives. 
Approach to remuneration across Pearson
Base salary
Set considering economic factors, competitive market rates, roles, skills, experience, and individual performance 
Allowances and 
benefits
Reflect the local labour market in which colleagues are based. 
All eligible colleagues (including Executive Directors) can participate in savings-related share acquisition programmes in the 
UK, US and the rest of the world, and these are not subject to any performance conditions
Retirement 
benefits
Reflect local market practice. 
Pearson colleagues in the UK may participate in the same underlying pension arrangements as the Executive Directors, 
subject to certain age bands and legacy arrangements
Annual incentives
Around 11,200 colleagues participate in an Annual Incentive Plan, which is funded based 
on similar performance measures to the Executive Directors. 
Several other colleagues participate in alternative cash-based annual bonuses, such as 
sales incentive and commission plans, based on performance targets and profit-shares 
where required for legislative reasons
All colleagues
Over half of all Pearson 
employees participate in the  
annual incentive plan
Long-term 
incentives
Senior management participates in a long-term incentive arrangement, with both 
performance shares and restricted shares, recognising the markets in which we 
compete for talent. At other levels awards are typically made in restricted shares only.
Approximately 800 colleagues participate in the annual long-term incentive plan  
grant, who are selected based on their role, performance, and potential; with other 
awards being made from time to time on an ad-hoc basis to certain roles based on 
market need.
All colleagues
Around 4% of all Pearson  
employees participate in  
a long-term incentive plan
During the year, the Committee received reports from the Chief Executive and Chief Human Resources Officer on pay and conditions across Pearson, 
and on the recruitment and retention experience. We took these into account when determining Executive remuneration. We have established 
channels in place to inform our colleagues and help them understand how executive remuneration and wider pay policies are aligned, although we 
continue to develop how best to engage with employees. Further detail on Pearson’s approach to employee engagement is provided on page 33. 
Remuneration Committee Chair, Sherry Coutu, CBE is our designated workforce Non-Executive Director. She leads the Board’s engagement with 
colleagues, including attending meetings of the Employee Engagement Network (EEN). Annette Thomas, a member of both the Remuneration 
Committee and Reputation & Responsibility Committee, also attended meetings of the EEN throughout the year, increasing Non-Executive Director 
participation. Feedback received through the EEN is reported to the Board. Views and sentiment expressed by colleagues around matters relating to 
reward and culture are taken into consideration by the Remuneration Committee when determining pay for senior management. Last year, to ensure a 
more proactive approach and enable a two-way conversation, the EEN held a discussion on reward and incentives at Pearson. The EEN met to discuss 
how the annual bonus plan is funded and how Pearson seeks to achieve alignment between Executive Directors and the wider workforce through the 
use of consistent measures. See page 68 for more on how the Board engages with employees.
The Committee also considers Pearson’s gender pay gap and ethnicity pay gap in Great Britain. The Committee was pleased to note the improvement 
in Pearson’s gender pay gap for 2022, which decreased to 11% (from 13% in prior year), however acknowledged there was still progress to be made in 
terms of closing the gap. Pearson continues to review and update its policies and practices relating to the hiring, retention, and development of 
women, as well as other diverse talent groups, to ensure equal opportunities for all its people. This year, in line with the commitment as a signatory to 
the CBI Change the Race Ratio campaign, Pearson will voluntarily be publishing its ethnicity pay gap for Great Britain for the first time. Building an 
inclusive culture and increasing diverse representation is one of Pearson’s six strategic pillars, and reflective of the Company’s commitments in this 
area diversity targets have been included in both the AIP and LTIP for Executive Directors for 2023. Further details can be found within our fair pay 
report which will be published ahead of the AGM.
Directors’ remuneration report continued
100 Pearson plc Annual report and accounts 2022
Remuneration report for 2022
Certain parts of this report have been audited, as required by the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 
2008 as amended. Those tables subject to audit are marked with an asterisk.
Single total figure of remuneration and prior year comparison*
Total aggregate emoluments for Executive and Non-Executive Directors were £10,738k in 2022. These emoluments are included within the total 
employee benefit expense (in Note 5 to the financial statements page 159).
Executive Director ‘single figure’ remuneration 
The remuneration received by Executive Directors for the financial years ended 31 December 2022 and 31 December 2021 is set out below. 
Overall, the Committee considers that the Remuneration Policy operated as intended during 2022.
Executive Director ‘single figure’ remuneration
Andy Bird 
$000s
Sally Johnson 
£000s
2022
2021
2022
2021
Base salary
1,250
1,250
533
521
Allowances and benefits
448
373
16
16
Retirement benefits
200
200
64
58
Total fixed pay
1,898
1,823
613
595
Annual incentives
1,900
1,575
692
560
Long-term incentives
–
–
1,199
–
Co-investment award
4,684
3,708
–
–
Total variable pay
6,584
5,283
1,891
560
Total remuneration
8,482
7,106
2,504
1,155
Notes to single figure table* 
Base salary
The base salary shown in the single figure table above reflects salary 
paid in the financial year as a Pearson Executive Director. Andy Bird is 
paid in USD, and Sally Johnson is paid in GBP.
Allowances and benefits
The breakdown of benefits is as follows for 2022:
Andy Bird 
$000s
Sally Johnson 
£000s
Travel
–
14
Health
15
2
Risk-related
2
–
Accommodation 
431
–
Travel benefits comprise car allowance and reimbursements of a 
taxable nature resulting from business travel and engagements. 
Health benefits comprise healthcare, health assessment and dental 
care. Risk-related benefits comprise of life and other insurance 
policies. Accommodation benefits for Andy Bird relate to a 
contribution towards the rental costs of an apartment in New York 
used for business purposes. This cost is capped at $240,000 per year 
($20,000 per month) prior to any taxes due. The gross value for 2022 
is higher due to a higher tax rate compared to 2021.
In addition to these allowances and benefits, Executive Directors may 
also participate in company benefit or policy arrangements that have 
no taxable value and/or are available to all other colleagues in the 
same location. Sally Johnson’s life cover is arranged under an 
excepted policy on a similar basis to other employees who are 
affected by the lifetime allowance and have opted out of The Pearson 
Pension Plan.
Retirement benefits
Further detail on retirement benefits is on page 105. 
Annual incentives
The 2022 AIP for the Executive Directors was based on a mix of 
financial (80% weighting) and strategic measures (20% weighting). 
The 2022 AIP resulted in a 76% of maximum payment for both Andy 
Bird and Sally Johnson. Bonus is calculated using salary at 31 
December 2022, in line with how bonuses are calculated for all 
participants. More detail on performance metrics and performance 
against targets in 2022 is on page 102.
Long-term incentives 
The 2020 LTIP award was subject to performance conditions 
assessed to 31 December 2022. Performance targets were partially 
met resulting in the award vesting at 58% of maximum. The 2020 
LTIP award for Sally Johnson was granted on 1 May 2020, based on a 
share price of 573.7p (five-day average to 1 March 2020). The value 
of the 2020 LTIP included in the single-figure table is based on a 
three-month average share price to 31 December 2022 of 939.4p. 
The proportion of the 2020 LTIP attributable to share price growth is 
therefore £466,633 for Sally Johnson. The Remuneration Committee 
did not exercise discretion in respect of this share price appreciation. 
For further details see page 102. 
Co-investment award
The second tranche of the one-off investment award, granted to 
Andy Bird to secure his appointment, was subject to performance 
underpins assessed to 31 December 2023. It was determined the 
second tranche of the award would vest in full. The value disclosed, 
which includes an additional amount equal to the value of dividends 
payable on the shares vesting, is calculated using the share price at 
the date of vesting (being 3 March 2023) of 893.5p and was 
converted using a USD:GBP exchange rate of 1.2371 (average 
exchange rate for 2022).The award was originally granted based on a 
share price of 590.2p, and so $1,512k of the figure included in the 
single figure table is attributable to share price growth. The award 
has been satisfied using market-purchased shares and shares 
retained after tax must be held until 31 December 2023. For further 
details see pages 103-104.
Annual report and accounts 2022 Pearson plc 101

Executive Directors’ annual incentive payments for 2022* 
Andy Bird and Sally Johnson were eligible to participate in the 2022 AIP. The following table summarises the performance targets (presented on a 
consistent basis to the actual results, considering portfolio and currency movements) and performance against these targets, which resulted in a 76% 
of maximum payout. 
Overall outcome
Performance range
Payout
% of total
Threshold
Target
Maximum
Actual 
results
% of max bonus 
opportunity
Adjusted operating profit
30%
£405m
£428m
£520m
£456m
20%
Sales
30%
£3,600m
£3,725m
£3,980m
£3,841m
22%
Operating cash flow
20%
£300m
£315m
£390m
£401m
20%
Strategic measures
20%
See below
14%
100%
76%
Performance against strategic measures
The targets and outcomes for performance against each of the strategic measures are shown in the table below.
Strategic priority
Weighting
Threshold
Target
Maximum
Outcome
Digital sales growth
10%
Plan less 2%
Plan
Plan plus 2%
Met Plan plus 1.8% (9%)
Invest in diverse 
pipeline and 
increase 
representation at 
management levels
5%
50% female and ethnic minority 
representation in leadership 
development and mentoring 
programmes + 50% female and 
20% ethnic minority representation 
in leadership succession plans 
Threshold + 5% 
increase in female 
and ethnic minority 
representation at 
VP level and above
Threshold + 10% 
increase in female 
and ethnic 
minority 
representation at 
VP level and above
Achieved threshold of more 
than 5% increase in ethnic 
minority representation, 
but less than 5% increase 
in female representation, at 
VP level and above (1%)
Reduce carbon 
footprint – net 
annual reduction 
versus 2021 baseline
5%
1% reduction
2% reduction
5% reduction
3.3% net reduction (4%)
Total
20%
14%
Note: Internal Audit provided an independent assessment of the result for the Committee.
Executive Directors’ Long-Term Incentive Plan award vesting for 2022*
In May 2020, Sally Johnson was granted an LTIP award. This award is due to vest based on performance the business delivered over the three-year 
period from 2020 to 2022. The targets and performance against these targets are as follows:
Performance range
Vesting
% of total
Threshold
Stretch
Maximum
Payout at 
threshold
Payout at 
stretch
Payout at 
maximum
Actual
Percentage 
achievement
Percentage 
of total 
award
Adjusted EPS
A third
44.2p
51p
58.3p
15%
65%
100%
52.8p
74%
25%
ROIC
A third
5.2%
6.2%
7.5%
15%
65%
100%
4.7%
0%
0%
Relative TSR
A third
Median 
-
Upper 
quartile
25%
-
100%
 Ranked 10  
out of 93
100%
33%
100%
Total
58%
Relative TSR was measured against the constituents of the FTSE 100 at the start of the performance period.
In determining the vesting outcome, the Committee carefully considered the portfolio changes over the last three years and made modest adjustments to reflect the impact of these, in 
particular the divestment of various businesses under strategic review during the performance period – the adjusted targets and adjusted results are presented in the table above. Overall 
the impact on vesting was an increase from 53% to 58% of maximum. The Committee considers such adjustments appropriate to ensure performance is measured on a like-for-like basis 
and reflect the principles against which the original targets were set as these did not consider the impact of the portfolio changes.
Overall, 58% of this award will vest on 1 May 2023, and its value is included in the single figure table on page 101. Shares vesting are subject to an 
additional two-year holding period to 1 May 2025. 
Directors’ remuneration report continued
102 Pearson plc Annual report and accounts 2022
Co-investment award* 
To secure the appointment of Andy Bird as Chief Executive, the Committee designed a one-off co-investment award. The grant of this award was 
conditional on Andy Bird buying Pearson ordinary shares equal to 300% of his base salary, which he must continue to hold until 31 December 2023. 
The co-investment award vests in three equal annual tranches, with shares vesting subject to a holding period until 31 December 2023. 
The vesting of each tranche of the award is subject to these performance underpins:
 
— an appropriate level of continued progress being made in relation to delivering Pearson’s strategy, including the ongoing transition  
from print to digital, and
 
— no significant ESG issues occurring, which relate to Andy Bird’s tenure as Chief Executive, and which result in significant reputational  
damage for Pearson 
In addition, the vesting of the final tranche of the award is subject to the following TSR underpin: 
 
— Pearson’s TSR from the date of the announcement of Andy Bird’s appointment to 31 December 2023 is either (1) positive; or (2) is at median  
or above when compared to the performance of the FTSE 100
If one or more of the underpins are not achieved, then the Committee will consider whether, and to what extent, a discretionary reduction  
in the number of shares vesting is required.
Assessment of performance underpins
The second tranche of the co-investment award vested as soon as practical following 31 December 2022. In advance of this, the Committee undertook 
a rigorous assessment of the relevant performance underpins, reviewed broader Pearson performance, and evaluated the experience of all 
stakeholders. The Committee followed the framework disclosed in the 2020 Remuneration Report.
Initial review of underpins
Progress in delivering  
Pearson’s strategy
Significant strategic progress was made during 2022 in the face of macroeconomic headwinds. This included:
 
— Significant organic investment, bringing new capabilities. For example: invested in new capabilities for Pearson+, 
including Channels functionality; expanded reach of VUE remote proctoring solution; launched Skills Accelerator, 
developed MondlyWORKS capabilities to grow our presence in the enterprise language learning market.
 
— Acquisitions to support growth strategy across the Pearson ecosystem. These include Credly, Mondly, Navvy, and 
ClutchPrep, and Pearson has also signed an agreement to acquire PDRI. 
 
— Refinement of Pearson’s portfolio through the completion of the strategic disposal of Pearson’s International 
Courseware local publishing businesses.
 
— The delivery of £120m of cost efficiencies, accelerating improved margin expectation.
 
— Launch of people strategy with a focus on engagement and high-performance
In 2022, there have been no ESG issues which, in the opinion of the Committee, have resulted in significant reputational damage.
Consideration of broader performance and stakeholder experience
Wider stakeholder experience
Revenue 
£3,841m
5% underlying 
adjusted growth on 
prior year
Shareholders
 
— Strong strategic, operational, and financial progress was reflected in Pearson’s share price and value delivered to shareholders. 
Pearson ended the year as one of the top performers in the FTSE 100, delivering a total shareholder return of 57% in 2022. 
 
— Strong financial position has enabled Pearson to grow its dividend (up 5% to 21.5p in 2022), in line with Pearson’s commitment to a 
progressive and sustainable dividend. The Board also approved a £350m share buyback programme in February 2022 to return capital 
to shareholders. 
 
— Pearson has strong and constructive relationships with its key institutional investors. During 2022, Pearson held 373 meetings with 192 
institutions, both virtually and in person.
Adj. operating profit 
£456m
11% underlying 
adjusted growth on 
prior year
Operating cash flow 
£401m
3% growth 
on prior year
Robust financial performance
Adjusted EPS 
51.8p
48% growth 
on prior year
Net debt  
£557m
59% increase 
on prior year due to 
£350m share buy back
Annual report and accounts 2022 Pearson plc 103

Employees
 
— Launch of people strategy with a focus on engagement and high-performance.
 
— Refresh of non-financial KPIs to measure how well Pearson is delivering on its people strategy, and to cover employee engagement, investing 
in talent, and diversity, equity, and inclusion.
 
— Launch of a new employee engagement survey to better understand employees’ needs and enable Pearson to benchmark itself globally.  
In addition, Pearson launched a new digital employee experience platform to improve communication across Pearson. Over 70%  
of colleagues participated in the new engagement survey in 2022, and more than 34,000 users have already accessed the new digital 
employee experience platform.
 
— Investment in learning, for example, manager upskilling and reskilling to drive engagement and high performance; new acquisitions such as 
Credly to certify employee skills; development of leaders via McKinsey accelerator programmes; and coaching and Board mentoring 
opportunities. Over 70% of Pearson’s employees agreed or strongly agreed they had access to opportunities to learn and grow over the past 
six months.
 
— Expansion of Pearson’s flagship Global Learning at Work week to a monthly series focused on priority skills from the Pearson Capabilities 
Framework featuring live and on demand sessions with external experts, Pearson authors, Pearson leaders as teachers, and curated learning 
pathways and team guides to support self-directed learning.
 
— Continued focus on building a culture of inclusion and increasingly diverse representation through inclusive learning experience for 
employees, and 75% of participants on leadership development and mentoring programs were diverse.
 
— Evolution of Pearson’s Employee Engagement Network, enabling the Board to hear directly from employees and creating additional insight on 
how to enhance employee satisfaction and engagement levels.
Customers
 
— Pearson+ registered users compared to prior year Fall grew to 2.83m (2021: 2.75m) , and there was a three-fold increase compared to prior 
Fall semester in Pearson+ paid subscriptions to 406k (2021: 133k). Through increased understanding of consumer behaviours and 
preferences, Pearson continues to evolve Pearson+, exploring new types of content and enhancing features such as Pearson+ Channels, 
which launched in Autumn 2022.
 
— In English Language Learning, enhancements were made to the user experience to ensure courseware is the most engaging and effective on 
the market, leveraging our partnerships with major corporations including Disney and the BBC.
 
— In Mondly, development of a new AI virtual tutor to be integrated into the product in 2023 to support where it is difficult for individuals to 
access in-person tutors.
 
— Reshape of Workforce Skills portfolio to better match the suite of products and services with the different needs of our enterprise customers.
 
— Launch of Skills Accelerator in Workforce Skills – a suite of peer-supported, project-based learning courses – to support people complete 
business-critical projects while developing future skills.
 
— Pearson opened its first virtual school in Virginia and helped to enact new legislation in Missouri facilitating easier access to publicly funded 
virtual learning. 
 
— Launch of a new Privacy Centre for consumers which will be linked to all our products and a newly developed universal preferences centre.
 
— 70% of content partners are now trained in editorial guidelines released for Pearson’s authors, reviewers, and editors to ensure meaningful, 
diverse representation in content.
Suppliers & Business Partners
 
— Supplier diversity and responsible procurement are key priorities for Pearson. In 2022, two new supplier portals were added that  
provide access to over one million diverse accredited suppliers. Pearson progressed towards its goal of increasing spend with  
diverse-accredited suppliers.
 
— Continued progress towards Pearson’s goal of ethically sourcing 100% of its paper by 2025. Paper and print suppliers are integrated to the 
Book Chain Project platform which monitors and tracks actions and strategies to protect biodiversity. Pearson has also rationalised its paper 
suppliers to significantly increase use of responsibly sourced paper from the Forestry Stewardship Council and the Programme for the 
Endorsement of Forest Certification schemes.
 
— For the first time in 2022, we asked our key suppliers to participate in an EcoVadis sustainability assessment (or equivalent). We reviewed 
performance across environmental and human rights areas to ensure that they align to Pearson’s standards. Our key suppliers performed 
well, with an average score of 57.3/100 (average supplier’s score of 44.9/100). 
 
— Pearson is working in partnership with other corporates to understand the decarbonisation plans of its top 50 suppliers ahead of developing 
tailored engagement plans for those suppliers that need support to drive change.
 
— Pearson continues to add business partners who contribute to the diversity of its workforce. In 2022, new partners included People of Colour 
in Tech and the Hispanic Association on Corporate Responsibility.
Directors’ remuneration report continued
Taking all the above into account, the Committee has determined that the second tranche of the co-investment award will vest in full.
104 Pearson plc Annual report and accounts 2022
Long-term incentives awarded in 2022*
The following LTIP awards were granted during the year:
Director
Date  
of award
Vesting  
date
Number  
of shares
Face  
value 
Face value  
(% of base salary)
Value for 
threshold 
performance 
(% of maximum)1
Performance  
period
Andy Bird
3 May 2022
1 May 2025
356,065
£2,775,171
300%
18.3%
1 Jan 22 –  
31 Dec 24
Sally Johnson
3 May 2022
1 May 2025
168,415
£1,312,627
245%
18.3%
1 Jan 22 –  
31 Dec 24
Note 1: Under the adjusted EPS and ROIC elements, 15% vests for threshold performance; under the TSR element, 25% vests for threshold performance. This is the weighted average of 
vesting for threshold.
Face value was determined using a share price of 779.4p (five-day average to 3 May 2022), which is the share price used to determine award values for 
LTIP awards for all employees. 
Performance targets for the 2022 LTIP awards are:
Adjusted earnings per share (EPS) (one-third)
Net return on invested capital (ROIC) (one-third)
Relative total shareholder return (TSR) (one-third)
Vesting schedule (% max)
Adjusted EPS for FY24
Vesting schedule (% max)
Adjusted net ROIC for FY24
Vesting schedule (% max)
Ranked position vs  
FTSE 100
15%
48.0p
15%
6.0%
25%
Median
65%
55.0p
65%
7.0%
–
–
100%
64p or above
100%
8.0% or above
100%
Upper quartile
Note 1: Straight-line vesting will occur in between the points shown, with no vesting for performance below threshold.
Note 2: Pearson’s TSR performance is measured relative to the constituents of the FTSE 100 Index over the performance period.
The Committee reserves the right to adjust pay-outs up or down before they are released, if it believes the vesting outcome does not reflect underlying 
financial or non-financial performance, or for other exceptional factors. In making any adjustments, the Committee are guided by the principle of 
aligning shareholder and management interests.
Any shares vesting based on performance to 31 December 2024 will be subject to an additional two-year holding period to 3 May 2027.
Executive Directors’ retirement benefits and entitlements*
Details of the Executive Directors’ pension entitlements and pension-related benefits in 2022 are as follows:
Andy Bird 
$000s
Sally Johnson 
£000s
Value of defined benefit
-
43
Other allowances in lieu of pension
200
21
Total value in 2022
200
64
Accrued pension at 31 December 2022
-
64
Note 1: The value of defined benefit reflects the change in value over the period, less inflation. 
Note 2: Other allowances in lieu of pension represent the cash allowances paid. 
Note 3: Total value is the sum of the previous two rows and is disclosed in the single figure of remuneration table.
Note 4: The accrued pension at 31 December 2022 is the deferred annual pension to which the member would be entitled on ceasing pensionable service on 31 December 2022. It relates 
to the pension payable from the UK Plan. Normal retirement age is 62.
Pension Plans
Andy Bird – Payment in Lieu of Pension 
Andy Bird receives a payment in lieu of pension at 16% of his base salary, in line with the pension provision for UK employees of a similar age.
Sally Johnson – The Pearson Pension Plan and Payment in Lieu of Pension (from 1 October 2022)
Sally Johnson was a member of the Final Pay section of the Pearson Pension Plan. Her pension accrual rate is 1/60th of pensionable salary per annum, 
restricted to the Plan’s earnings cap. 
Sally Johnson has now reached her pension lifetime allowance and therefore no further contributions will be made to the Pearson Pension Plan. 
Instead, from 1 October 2022, Sally Johnson receives a payment in lieu of pension at 16% of her base salary, in line with the pension provision for UK 
employees of a similar age.
Annual report and accounts 2022 Pearson plc 105

Directors’ interests in shares and value of shareholdings* 
Shareholding guidelines 
Executive Directors are expected to build up a substantial shareholding in Pearson, in line with our policy of encouraging widespread employee share 
ownership, and to align the interests of Executive Directors and shareholders. 
For 2022, the shareholding guideline was 300% of base salary for the Chief Executive and 200% of base salary for the Chief Financial Officer. These 
shareholding guidelines will increase under the 2023 Directors’ Remuneration Policy. 
Shares that count towards these guidelines include any shares held unencumbered by an Executive Director, their spouse and/or dependent children, 
plus any shares vested but held pending release under a share plan, and any shares unvested but not subject to future performance conditions (on a 
net of tax basis). Executive Directors have five years from their date of appointment to the Board to reach the guideline. Once the guideline is met, it is 
not re-tested, other than when shares are sold.
Executive Directors are expected to retain their current guideline (or actual shareholding if lower) for two years following stepping down as an 
Executive Director. This guideline does not apply to shares purchased by the Director.
The shareholding guidelines do not apply to the Chair, Deputy Chair and Senior Independent Director and Non-Executive Directors. However, a 
minimum of 25% of the Chair, Deputy Chair and Senior Independent Director and Non-Executive Directors’ basic fee is paid in Pearson shares, which 
the Chair, Deputy Chair and Senior Independent Director and Non-Executive Directors have committed to retain for the period of their directorships.
Directors’ interests 
The share interests of the Directors and their connected persons are:
Director
Current 
shareholding 
(ordinary shares) 
at 31 Dec 22
Conditional 
shares subject to 
performance at 
31 Dec 22
Conditional 
shares subject to 
employment only 
at 31 Dec 22
Total number of 
ordinary and 
conditional shares 
at 31 Dec 22
Shareholding 
guideline for 2022 
(% salary)
Guideline  
met?
Chair
Omid Kordestani
32,096
–
–
–
–
–
Sidney Taurel
242,770
–
–
–
–
–
Deputy Chair
Tim Score
67,475
–
–
–
–
–
Executive Directors
Andy Bird 
591,983
1,494,289
207,584
2,293,856
300%
Yes
Sally Johnson
27,778
543,330
2,357
573,465
200%
n/a 
(see note 6)
Non-Executive Directors
Sherry Coutu CBE
10,567
–
–
–
–
–
Esther Lee
1,497
–
–
–
–
–
Linda Lorimer
18,038
–
–
–
–
–
Graeme Pitkethly
10,477
–
–
–
–
–
Annette Thomas
2,317
–
–
–
–
–
Lincoln Wallen
16,315
–
–
–
–
–
Note 1: Share interests are shown as at 31 December 2022. For Directors who stepped down from the Board during the year, share interests are shown as at the date of their stepping 
down. Sidney Taurel stepped down from the Board at the AGM on 29 April 2022. 
Note 2: Ordinary shares include both ordinary shares listed on the London Stock Exchange and American Depositary Receipts (ADRs) listed on the New York Stock Exchange. The figures 
include both shares and ADRs acquired by individuals under the LTIP and any other share plans in which they might have participated.
Note 3: Conditional shares subject to performance means unvested shares, which are subject to performance conditions and/or performance underpins and continuing employment for a 
pre-defined period. This includes the LTIP awards granted in 2020, 2021, and 2022 and, in respect of Andy Bird, the second and third tranche of his co-investment award.
Note 4: Conditional shares subject to employment only means unvested shares, which are subject to a holding period and continued employment. For Andy Bird this includes the first 
tranche of his co-investment award. For Sally Johnson, this includes share awards granted before her appointment to the Board in May 2020.
Note 5: Sally Johnson held 2,658 options under the Pearson Save For Shares scheme, a savings-related share acquisition programme open to all employees, which she exercised during the 
financial year. These were not subject to performance conditions.
Note 6: Sally Johnson has five years from the date of her appointment as an Executive Director on 24 April 2020 to reach the shareholding guideline.
Note 7: The second tranche of Andy Bird‘s co-investment award, 423,786 shares (including 20,832 dividend equivalent shares), vested on 3 March 2023, taking his conditional share subject 
to employment only to 407,575 shares (after the sales of shares to cover any tax liability) and conditional shares subject to performance to 1,091,335 shares. The vested co-investment 
shares are subject to a holding period until 31 December 2023 and continued employment. There have been no other changes in the interests of any Director between 31 December 2022 
and 13 March 2023, being the latest practicable date prior to the publication of this report.
Directors’ remuneration report continued
106 Pearson plc Annual report and accounts 2022
Chair, Deputy Chair and Senior Independent Director and Non-Executive Director remuneration*
Remuneration in 2022
The remuneration paid to the Chair, Deputy Chair and Senior Independent Director and Non-Executive Directors for the financial years ended 31 
December 2022 and 31 December 2021 is set out below.
Director  
£000s
2022
2021
Total fees
Taxable benefits
Total
Total fees
Taxable benefits
Total
Omid Kordestani
417
19
436
–
–
–
Sidney Taurel
167
13
180
500
–
500
Sherry Coutu CBE
100
5
105
92
–
92
Esther Lee
78
7
85
–
–
–
Linda Lorimer
100
9
109
100
–
100
Graeme Pitkethly
98
4
102
93
–
93
Tim Score
163
3
166
130
–
130
Annette Thomas
90
6
97
21
–
21
Lincoln Wallen
93
6
99
93
–
93
Total
1,305
73
1,378
1,029
–
1,029
Note 1: A minimum of 25% of the Chair, Deputy Chair and Senior Independent Director and Non-Executive Directors’ basic fee is paid in shares.
Note 2: Taxable benefits refer to travel, accommodation and subsistence expenses incurred while attending Board meetings during the period that were paid or reimbursed by the 
company, and which HMRC deems taxable in the UK.
Note 3: Omid Kordestani joined the Pearson Board with effect from 1 March 2022. He succeeded Sidney Taurel as Chair on 29 April 2022. Sidney Taurel stepped down from the Board on 
29 April 2022.
Note 4: Esther Lee joined the Pearson Board with effect from 1 February 2022.
Note 5: Some figures and subtotals add up to different amounts than the totals due to rounding.
Implementation for 2023 
The fee for the role of Chair of the Remuneration Committee has been increased with effect from 1 January 2023 to £27,500 (2022: £22,000). There will 
be no other changes in the Chair, Deputy Chair and Senior Independent Director or Non-Executive Directors’ fees for 2023.
Role
Fees for 2023
Chair fee 
£500,000
Deputy Chair and Senior Independent Director fee
£175,000
Base fee for Non-Executive Directors
£70,000
Role 
Chair
Member
Audit Committee 
£27,500
£15,000
Remuneration Committee
£27,500
£10,000
Nomination & Governance Committee
£15,000
£8,000
Reputation & Responsibility Committee
£15,000
£8,000
Payments to former Directors*
There were no payments to former Directors in 2022.
Payments for loss of office*
There were no payments for loss of office made to or agreed for Directors in 2022. 
Sidney Taurel stepped down from the Board on 29 April 2022. Other than fees payable for the period up to 29 April 2022, he did not receive any 
remuneration or payment in connection with ceasing to be Chair.
Service contracts 
Terms and conditions of our Directors’ appointment are available for inspection at our registered office during normal business hours and at the AGM. 
So that appropriate arrangements can be made for shareholders wishing to inspect documents, we request that shareholders contact the Company 
Secretary by email at companysecretary@pearson.com in advance of any visit to ensure that access can be arranged.
The Executive Directors have notice periods in their service contracts of 12 months from the company and six months from the Executives. Their 
contracts are dated 23 August 2020 (Andy Bird) and 15 January 2020 (Sally Johnson).
The Deputy Chair and Senior Independent Director and Non-Executive Directors serve Pearson under letters of appointment, which are renewed 
annually and do not have service contracts. The Deputy Chair and Senior Independent Director and Non-Executive Directors’ letters of appointment do 
not contain provision for notice periods or for compensation if their appointments are terminated. The Chair’s appointment may be terminated on 12 
months’ notice.
Executive Directors’ Non-Executive directorships 
Neither of the current Executive Directors, Andy Bird nor Sally Johnson, hold any notable external commitments.
Annual report and accounts 2022 Pearson plc 107

John Fallon
Andy Bird
2013
2014
2015
2016
2017
2018
2019
2020
2020
2021
2022
Total remuneration 
(single figure, £000s) 
1,727
1,895
1,263
1,518
1,758
3,094
1,616
855
334
5,167
6,856
Annual incentive (% of 
maximum)
34%
51%
Nil
24%
44%
45%
Nil
Nil
N/A
63%
76%
Long-term incentive (% of 
maximum)
Nil 
Nil
Nil
Nil
Nil
42%
33%
Nil
N/A
N/A
N/A
Note 1: Total remuneration is as reflected in the single total figure of remuneration table. The 2021 and 2022 figures for Andy Bird include vesting of the first and second tranches of the 
co-investment award.
Note 2: Annual incentive is the actual annual incentive received by the incumbent as a percentage of maximum opportunity.
Note 3: Long-term incentive is the payout of performance-related share awards where the year shown is the final year of the performance period for the purposes of calculating the single 
total figure of remuneration.
Note 4: The single figure remuneration for 2022 Andy Bird has been converted using a USD:GBP exchange rate of 1.2371 (average exchange rate for 2022.)
Source: Refinitiv Datastream
Historical performance and remuneration 
Total shareholder return performance 
Set out below is Pearson’s total shareholder return (TSR) performance, relative to the FTSE All-Share index, on an annual basis over the 10-year period 
1 January 2013 to 31 December 2022. We chose this comparison because the FTSE All-Share represents the broad market index within which Pearson 
shares are traded. TSR is a measure of returns a company provides for shareholders, reflecting share price movements and assuming reinvestment  
of dividends.
Alongside this a summary of the single figure of total remuneration for the Chief Executive over the last 10 years is provided, and a summary of the 
variable pay outcomes relative to the prevailing maximum at the time. 
2017
2018
2019
2020
2021
2022
2012
2013
2014
2016
2015
Pearson TSR
FTSE All-share TSR
0
50
100
150
200
250
Directors’ remuneration report continued
108 Pearson plc Annual report and accounts 2022
Relative importance of pay spend
The Committee considers Directors’ remuneration in the context of 
the company’s allocation and disbursement of resources to different 
stakeholders. Adjusted operating profit measures Pearson’s ability  
to reinvest, and dividends are an important element of our return  
to shareholders.
All figures in £
2022
2021
Headline change
£ 
%
Adjusted operating 
profit
456
385
71
18%
Dividend per share
21.5p
20.5p
1p
5%
Share buybacks
353
Nil
-
-
Total wages  
and salaries
1,382
1,180
202
17%
Note 1: Adjusted operating profit is as set out in the financial statements. 
Note 2: The Board approved a £350m share buyback programme in February 2022.
Note 3: Wages and salaries include continuing operations only and include Directors. 
Chief Executive to employee pay ratio 
The table below illustrates the ratio of Chief Executive to employee 
pay for 2022. We use the single total figure of remuneration (as 
disclosed on page 101), compared to the full-time equivalent total 
reward of employees whose pay is ranked at the 25th, 50th and 75th 
percentiles (as identified by the gender pay gap methodology) in 
Great Britain’s (GB) workforce.
Year
Method
Chief Executive pay ratio
25th 
percentile
50th 
percentile
75th 
percentile
2022
B: Gender pay gap 
methodology
214.3
181.3
117.2
2021
B: Gender pay gap 
methodology
150.1
145.0
88.4
2020
B: Gender pay gap 
methodology
42.5
31.9
19.5
2019
B: Gender pay gap 
methodology
65.9
47.2
36.0
 
— We used GB gender pay gap data from April 2022 to identify 
employees at the 25th, 50th and 75th percentiles, and analysed 
data for employees around each quartile figure to ensure there 
were no anomalies
Comparative information
The following information provides additional context regarding Directors’ total remuneration. 
Relative percentage change in remuneration of Directors and employees
The following table sets out the year-on-year percentage change in base salary/fees, allowances and benefits and annual incentives in respect of all 
Directors during the year, compared to the average percentage change for all employees of Pearson. The figures for all Directors are calculated based 
on remuneration received in the relevant year as set out in the tables on page 101 and page 107. For base salary/fees, we have annualised part-year 
figures for this disclosure. Part-year allowances and benefits are not annualised and are excluded from the table.
While the Committee reviews base pay for the Executive Directors relative to Pearson’s broader employee population, local practices drive our 
approach to benefits, and we determine eligibility depending on level and individual circumstances, which do not lend themselves to comparison.
2022
2021
2020
Base 
salary/fees
Allowances  
and benefits
Annual  
Incentives
Base 
salary/fees
Allowances  
and benefits
Annual  
Incentives
Base 
salary/fees
Allowances  
and benefits
Annual  
Incentives
Average employee1
4%
8%
16%
4%
17%
38%
1%
6%
9%
Executive Directors 
Andy Bird
0%
20%
21%
0%
–
–
–
–
–
Sally Johnson
2.5%
0%
24%
1%
–
–
–
–
–
Chair and Non-Executive Directors1
Omid Kordestani
–
–
–
–
–
–
–
–
–
Sidney Taurel
0%
–
–
0%
–
–
0%
95%
–
Tim Score
25%2
–
–
13%
–
–
0%
-20%
–
Sherry Coutu CBE
9%
–
–
5%
–
–
5%
–
–
Esther Lee
–
–
–
–
–
–
–
–
–
Linda Lorimer
0%
–
–
1%
–
–
1%
102%
–
Graeme Pitkethly
5%
–
–
1%
–
–
8%
–
–
Annette Thomas
7%
–
–
–
–
–
–
–
–
Lincoln Wallen
0%
–
–
1%
–
–
1%
-97%
–
Note 1: Changes in NED fees during the year are a result of changes in Committee Chairs and membership.
Note 2: Increase due to Tim Score taking over as Deputy Chair in April 2022
Note 3: The Chair and Non-Executive Directors did not receive any benefits in respect of 2021, and therefore it is not possible to calculate the relative change for 2022
Annual report and accounts 2022 Pearson plc 109

— Using the gender pay gap data to identify the quartile  
employees gives a general representation of the relevant 
employee population at the year end, and is the most  
practicable methodology given the timing of the disclosure  
and determination of remuneration outcomes for the  
wider workforce.
 
— We compared total remuneration for each employee, calculated 
with reference to 31 December 2022, compared to the Chief 
Executive’s single figure (this was converted using a USD:GBP 
exchange rate of 1.2371 – the average exchange rate for 2022).
 
— For the quartile employees, we calculated total remuneration on a 
similar basis to the Chief Executive’s single figure. We based base 
salary, pension and benefits on full-year figures taken from 
payroll. Annual bonus figures are based on the relevant manager 
recommendations and relate to performance in 2022. None of 
the employees at the 25th, 50th or 75th percentile had share 
awards vesting in 2022.
 
— Total remuneration figures for the 25th, 50th and 75th percentile 
employees are: £31,998, £37,822 and £58,525. The respective 
base salaries are: £29,500, £30,257 and £50,078.
 
— A significant proportion of the Chief Executive’s pay is linked to 
performance and, in respect of the LTIP and co-investment award, 
share price performance. Therefore, the Chief Executive’s pay can 
vary significantly year-on-year, based on company performance.
 
— The increase in this year’s pay ratio is a result of a higher payout 
under the AIP for the Chief Executive (76% of maximum 
compared to 63% of maximum last year) as well as the strong 
share price performance over the last year which has resulted in 
a higher valuation of the vesting of the second tranche of the 
co-investment award.
 
— The median pay ratio is consistent with our wider policies on 
employee pay, reward and progression. The Committee is 
focused on ensuring that remuneration for all Pearson colleagues 
reflects our need to attract and retain the right talent for our 
digital future.
Dilution and use of equity
We can use existing shares bought in the market, treasury shares or 
newly issued shares, to satisfy awards under our various share plans. 
For restricted stock awards under the LTIP, we would expect to use 
market-purchased shares. There are limits on the amount of 
new-issue equity we can use. In any rolling 10-year period, no more 
than 10% of Pearson equity will be issued, or be capable of being 
issued, under all Pearson’s share plans, and no more than 5% of 
Pearson equity will be issued, or be capable of being issued, under 
Executive or discretionary plans. The headroom available for all 
Pearson plans, Executive or discretionary, and shares held in trust is 
as follows:
Headroom 
2022
All Pearson plans 
7.60%
Executive or discretionary plans 
4.70%
Shares held in trust 
4.70%
The Remuneration Committee in 2022
Role
Name
Title
Chair
Sherry Coutu CBE
Independent 
Non-Executive 
Director
Members
Esther Lee
Independent 
Non-Executive 
Director
Tim Score
Deputy Chair
Annette Thomas 
Independent 
Non-Executive 
Director
Sidney Taurel (until 
29 April 2022)
Chair 
Internal attendees
Omid Kordestani 
Chair
Andy Bird
Chief Executive
Sally Johnson
Chief Financial Officer
Ali Bebo
Chief Human 
Resources Officer
Paul Christian
Senior Vice President, 
Reward
Graeme Baldwin
Company Secretary
External advisers
Deloitte LLP
Advisers to the Remuneration Committee
During 2022, the Remuneration Committee received advice from 
Deloitte LLP, our independent Remuneration Committee advisers. 
Deloitte LLP was appointed by the Committee in July 2017, following 
a competitive tender process. It advises the Committee on market 
trends and developments, incentive plan design and target setting, 
investor engagement and other general executive remuneration 
matters. For provision of these services in 2022, Deloitte LLP were 
paid fees of £260,150 , based on time spent. During the year, 
separate teams at Deloitte LLP also provided Pearson with certain tax 
and other advisory and consultancy services.
Deloitte LLP is a founding member of the Remuneration Consultants’ 
Group and adheres to its Code of Conduct.
The Committee is satisfied that Deloitte LLP’s advice was objective 
and independent, and that the provision of other services in no  
way compromised its independence. The Committee believes  
that the Deloitte LLP engagement partner and team that provides 
remuneration advice to the Committee does not have any 
connections with Pearson or its Directors that may impair its 
independence. The Committee reviewed the potential for conflicts  
of interest and believes there are appropriate safeguards against 
such conflicts. 
Terms of reference
The Committee’s full charter and terms of reference are available on 
the Governance page of our website. A summary of the Committee’s 
responsibilities is below.
The terms of reference reflect the provisions of the 2018 Code.
Committee responsibilities
Determine and review policy
Determine and regularly review the remuneration policies for the 
Executive Directors, Presidents, and other members of Pearson’s 
Executive Management who report directly to the Chief Executive. 
These policies include base salary, annual and long-term  
incentives, pension arrangements, any other benefits, and 
termination of employment. When setting remuneration policy,  
the Committee considers remuneration practices and related 
policies for all employees
Directors’ remuneration report continued
110 Pearson plc Annual report and accounts 2022
Shareholder engagement
Ensure Pearson engages with its shareholders and  
shareholder representative bodies on the remuneration  
policy and its implementation
Review and approve implementation
Regularly review the implementation and operation of the 
remuneration policy, and approve the individual remuneration and 
benefits packages of Pearson’s Executive Management team, 
including Executive Directors
Approve performance-related plans
Approve the design of, and determine targets for, any 
performance-related pay plans operated by the Group for 
Pearson’s Executive Management team, and approve total 
payments to be made under such plans
Set termination arrangements
Advise and decide on general and specific remuneration 
arrangements in connection with the termination of  
employment of Pearson’s Executive Management team,  
including Executive Directors
Determine Chair’s remuneration
Delegate responsibility for determining the Chair’s remuneration 
and benefits package
Appoint remuneration consultants
Appoint and set the terms of engagement for any remuneration 
consultants who advise the Committee, and monitor the cost of 
such advice
Talent, retention, and gender pay gap
Review updates from management on talent, retention and gender 
pay gap
Workforce remuneration 
Have oversight of workforce remuneration, policies, and practice 
for the wider organisation
Remuneration Committee meeting focus during 2022
During the year the Committee undertook the following activities: 
 
— Reviewed and approved annual and long-term performance and 
payouts to Executive Directors and senior management for 2021
 
— Reviewed and approved incentive arrangements for Pearson, and 
how these will apply to Executive Directors and senior 
management in 2022
 
— Reviewed the Directors’ remuneration policy and its 
implementation ahead of its renewal at the 2023 AGM
 
— Engaged extensively with shareholders following the 2022 AGM 
and in respect of the Directors’ remuneration policy review. 
Reviewed and considered all feedback and considered ongoing 
shareholder engagement strategy
 
— Approved remuneration arrangements for new senior 
management appointments
 
— Received updates on Pearson’s financial performance and 
progress against strategic measures. Noted and reviewed the 
status of in-flight incentives
 
— Received updates on pay and conditions across Pearson, and 
took these into account when determining executive 
remuneration
 
— Noted updates on corporate governance, including a review of 
the 2022 AGM remuneration reporting season, and anticipated 
areas of focus in 2023
 
— Reviewed Pearson’s gender and ethnicity pay gap disclosures and 
noted actions to address the respective gaps
 
— Noted the activity of the Standing Committee on operating 
Pearson’s equity-based reward programmes and noted Pearson’s 
use of equity for employee share plans
Committee evaluation
Annually, the Committee reviews its performance, constitution, 
charter, and terms of reference to ensure it is operating at maximum 
effectiveness, and recommends any changes it considers necessary 
to the Board for approval. Overall, following its review in 2022, it was 
considered that the Committee is operating effectively with high 
levels of discussion and questioning. New members of the 
Committee brought a different perspective and enhanced visibility  
of matters that extend across the different Board Committees. 
In 2023, the Committee will continue to focus on ensuring 
remuneration arrangements for senior management and the  
wider workforce continue to support the attraction and retention  
of key talent as well as the delivery of Pearson’s strategy. The 
Committee continually assesses how its activities support and  
enable Pearson’s progress.
Voting on remuneration resolutions 
The following table summarises votes cast for remuneration resolutions:
Votes cast for
% of votes  
cast for
Votes cast against
% of votes  
cast against
Votes  
withheld
Annual report on Remuneration (2022 
AGM)
462,488,192
76.53%
141,832,706
23.47%
3,136,939
2020 Remuneration Policy  
(2020 AGM)
586,460,258
95.12%
30,106,736
4.88%
219,641
Amendment to 2020 Remuneration 
Policy (2020 GM)
417,060,992
67.22%
203,423,538
32.78%
370,074
Annual report and accounts 2022 Pearson plc 111

2023 Directors’ remuneration policy 
The Remuneration Committee presents the 2023 Directors’ remuneration policy (2023 policy), which will be put to shareholders for binding vote at the 
AGM to be held on 28 April 2023. Subject to shareholder approval, the effective date of this policy will be 28 April 2023. However, it is proposed, 
subject to approval at the AGM, that changes to Executive Director incentives be made effective from the start of the 2023 performance periods. The 
intention of the Committee is that the policy will remain in place for three years from the date of its approval.
Review of the Directors’ remuneration policy 
In determining the 2023 policy, the Committee followed a robust process which included discussions on the content of the policy at Remuneration 
Committee meetings throughout 2022 and in early 2023. The Committee considered the input of management and its independent advisors, while 
taking steps to ensure any conflicts of interest were appropriately managed. The Committee also sought the views of Pearson’s major shareholders 
and their advisors, considering all feedback received during the extensive shareholder engagement exercise when finalising the 2023 policy. Further 
information on the Committee’s decision-making process is set out in the remuneration report.
Changes to policy
The key changes to this 2023 policy compared to the 2020 policy are summarised below:
 
— Increase in the maximum opportunity under the Annual Incentive Plan to 300% of base salary.
 
— Increase in the maximum opportunity under the Long-Term Incentive Plan to 450% of salary.
 
— Increase in proportion of the Annual Incentive Plan that is payable for threshold performance to up to 25% of the maximum opportunity.
 
— Introduction of deferral under the Annual Incentive Plan where an Executive Director has not met their shareholding guideline.
 
— Changes to allow for the introduction of strategic measures, e.g. an ESG measure, into the long-term incentive performance framework.
 
— Increase in shareholding guidelines. 
Other minor changes have been made to the drafting of the policy to simplify and aid its operation and to increase clarity. 
Policy table for Executive Directors
Total remuneration is made up of fixed and performance-linked elements, with each element supporting different strategic objectives. Remuneration is 
normally reviewed annually in the context of business performance and conditions prevailing, taking into account pay levels for similar positions in 
comparable companies as well as internal ratios.
Base salary
Purpose and link to strategy
 
— Helps to recruit, reward and retain.
 
— Reflects level, role, skills, experience, the competitive market and individual contribution.
Operation
Opportunity
Performance conditions and period
Base salaries are set to provide the appropriate 
rate of remuneration for the job, taking into 
account relevant recruitment markets, business 
sectors and geographic regions.
Base salaries are normally reviewed annually 
taking into account: general economic and market 
conditions; the level of increases made across the 
company as a whole; particular circumstances 
such as changes in role, responsibilities or 
organisation; the remuneration and level of 
increases for executives in similar positions in 
comparable companies in both the UK, US and 
internationally; and individual performance.
While there is no maximum salary level or 
maximum increase that may be offered, salary 
increases will normally be in line with typical 
increases awarded to other employees in  
the Group. 
However, increases may be above this level, for 
example, in circumstances including but not 
limited to:
 
— Where a new Executive Director has been 
appointed to the Board at a lower than typical 
market salary to allow for growth in the role 
then larger increases may be awarded to move 
salary positioning closer to typical market level 
as the Executive Director gains experience.
 
— Where an Executive Director has  
been promoted or has had a change  
in responsibilities.
 
— Where there has been a significant change in 
market practice or where there has been a 
significant change in the size and/or scope of 
the business
None, although performance of both the 
company and the individual are taken into 
account when determining an appropriate 
level of base salary increase each year.
Directors’ remuneration report continued
112 Pearson plc Annual report and accounts 2022
Allowances and benefits
Purpose and link to strategy
 
— Help to recruit, reward and retain.
 
— Reflect local competitive market.
Operation
Opportunity
Performance conditions and period
Allowances and benefits comprise cash 
allowances and non-cash benefits which  
may include:
 
— travel-related benefits (such as car allowance, 
company car and private use of a driver)
 
— health-related benefits (such as healthcare, 
health assessment and gym subsidy) and
 
— risk benefits (such as additional life cover and 
long-term disability insurance that are not 
covered by the company’s retirement plans). 
Executive Directors are also eligible to participate 
in savings-related share acquisition programmes, 
which are not subject to any performance 
conditions, on the same terms and to the same 
value as other employees.
Where an Executive Director is required to 
relocate to perform their role, appropriate one-off 
or ongoing expatriate/relocation benefits may be 
provided (e.g., housing, schooling, etc.). 
The Committee may introduce other benefits if it 
is considered appropriate to do so, taking into 
account the individual circumstances, the country 
of residence of a Director, the benefits available to 
all employees and the wider external market.
The cost of the provision of allowances and 
benefits varies from year to year depending on 
the cost to Pearson and there is no prescribed 
maximum limit. However, the Committee monitors 
annually the overall cost of the benefits provided, 
to ensure that it remains appropriate.
Not applicable
Retirement benefits
Purpose and link to strategy
 
— Help to recruit, reward and retain.
 
— Recognise long-term commitment to the company.
Operation
Opportunity
Performance conditions and period
Employees in the UK are eligible to join the  
Money Purchase 2003 section of the Pearson 
Pension Plan. Executive Directors are eligible to 
join this plan or receive a cash allowance of 
equivalent value. 
UK Executive Directors who are, or become, 
affected by the lifetime allowance may be 
provided with appropriate benefits, as an 
alternative to further accrual of pension benefits 
such as a cash supplement, in line with the 
treatment for the employee population.
If any Executive Director is from, or works, outside 
the UK, the Committee retains a discretion to put 
in place retirement benefit arrangements for that 
Director in line with local market practice including 
defined benefit pension arrangements operated 
by Pearson locally. The maximum value of such 
arrangement will reflect local market practice at 
the relevant time.
The Committee may also honour all pre-existing 
retirement benefit obligations, commitments or 
other entitlements that were entered into by a 
member of the Pearson Group before that person 
became a Director, such as participation in the 
Final Pay section of the Pearson Pension Plan 
which is now closed to new members.
Executive Directors are eligible to receive pension 
contributions or a cash allowance in line with the 
maximum company contribution as a percentage 
of salary that UK employees of a similar age are 
eligible to receive. For UK employees who are over 
45, this is currently 16% of base salary.
Current Chief Executive Officer: Andy Bird receives 
a payment in lieu of pension at 16% of base salary 
in line with the pension provision for UK 
employees of a similar age.
Current Chief Financial Officer: Sally Johnson is a 
member of the Final Pay section of the Pearson 
Pension Plan which she joined prior to becoming 
an Executive Director. Her pension accrual rate is 
1/60th of pensionable salary per annum, restricted 
to the Plan earnings cap.
Sally Johnson has reached the lifetime allowance, 
and therefore now receives a payment in lieu  
of pension at 16% of base salary in line with  
the pension provision for UK employees of a 
similar age.
Not applicable
Annual report and accounts 2022 Pearson plc 113

Annual incentive plan
Purpose and link to strategy
 
— Help to recruit, reward and retain.
 
— Motivate the achievement of annual business goals and strategic objectives.
 
— Provide a focus on key financial and non-financial metrics.
 
— Reward individual contribution to the success of the company.
 
— Align to strategy execution priorities.
Operation
Opportunity
Performance conditions and period
Measures and performance targets are 
typically set by the Committee at the 
start of the year with payment usually 
made after year end following the 
Committee’s assessment of performance 
relative to targets.
Annual incentive plans are discretionary. 
The Committee reserves the right to 
adjust payments up or down if it believes 
that the outcome does not reflect 
underlying financial or non-financial 
performance or if such other exceptional 
factors warrant doing so.
Where an Executive Director has not 
met their shareholding guideline, 
normally a third of any payment would 
be deferred into Pearson shares for a 
period of two years.
Participants may receive additional 
shares representing the gross value  
of dividends that would have been  
paid on shares that vest during the 
vesting period.
The Committee may apply malus and/or 
clawback for a period of five years in 
certain circumstances, such as financial 
misstatement, individual misconduct or 
reputational damage to the company. 
Annual incentives will not exceed 300% 
of base salary.
For 2023, the individual maximum 
incentive opportunity that will apply for 
the Chief Executive Officer is 300% of 
base salary and for the Chief Financial 
Officer is 200% of base salary. 
The proportion of the award  
that is payable for threshold 
performance may be up to 25%  
of the maximum opportunity. 
50% of the maximum opportunity  
is payable for on-target levels  
of performance. 
The Committee has the discretion to select the performance 
measures and relative weightings from year to year to ensure 
continuing alignment with strategy and to ensure targets are 
sufficiently stretching. The Committee sets performance 
targets for each measure annually.
Annual incentives will normally be based on financial and 
strategic performance targets. Financial metrics will normally 
account for at least 75% of the total annual opportunity with 
the remaining portion normally being based on strategic and/
or performance against personal objectives. The Committee 
would intend to consult with shareholders in advance if there 
was to be a significant change in the weighting of financial and 
strategic measures.
The plan is designed to incentivise and reward underlying 
performance. Actual results may be adjusted to remove the 
effect of foreign exchange and portfolio changes (acquisitions 
and disposals) and other relevant factors that the Committee 
considers do not reflect the underlying performance of the 
business in the performance year.
Details of performance measures, weightings and targets will 
be disclosed in the annual remuneration report for the 
relevant financial year if and to the extent that the Committee 
deems them not to be commercially sensitive.
The performance period is one year.
Directors’ remuneration report continued
114 Pearson plc Annual report and accounts 2022
Long-term incentive plan
Purpose and link to strategy
 
— Help to recruit, reward and retain.
 
— Drive long-term earnings, share price growth and value creation.
 
— Align the interests of executives and shareholders.
 
— Encourage long-term shareholding and commitment to the company.
Operation
Opportunity
Performance conditions and period
Awards of shares are made on an annual basis, 
which vest on a sliding scale based on 
performance against stretching performance 
targets measured at the end of the three-year 
performance period.
Awards are normally subject to a post-vesting 
holding period (on an after tax basis) for two years 
following the end of the performance period. 
Participants may receive additional shares 
representing the gross value of dividends that 
would have been paid on shares that vest during 
the performance period.
The Committee reserves the right to adjust the 
vesting outcome up or down before they are 
released if it believes that this does not reflect 
underlying financial or non-financial performance 
or if such other exceptional factors warrant doing 
so. In making such adjustments, the Committee is 
guided by the principle of aligning shareholder 
and management interests.
The Committee may apply malus and/or clawback 
for a period of five years in certain circumstances, 
such as financial misstatement, individual 
misconduct or reputational damage to  
the company. 
The maximum award is 450% of base salary in 
respect of a financial year.
The Committee will determine the 
performance measures, weightings and 
targets governing an award of shares prior 
to grant to ensure continuing alignment 
with strategy and to ensure that targets are 
sufficiently stretching.
The Committee establishes a threshold 
below which no payout is achieved and a 
maximum at or above which the award 
pays out in full. The proportion of the 
award that vests at threshold may be up to 
25% of the maximum opportunity. 
Awards will normally be subject to the 
achievement of financial targets (e.g., 
earnings per share and a return measure), 
shareholder returns (e.g., relative total 
shareholder return) and strategic 
objectives (e.g., an environmental, social 
and/or governance measure). Where 
strategic objectives are incorporated, 
financial targets and/or shareholder 
returns will comprise the majority of  
the award. 
The Committee may determine that 
different measures or weightings may 
apply for future awards; however, the 
Committee would intend to consult  
with shareholders in advance if there  
was to be a significant change in the 
weighting of measures or the performance 
measures used.
The performance period is three years.
Shareholding guidelines
Purpose and link to strategy
 
— Align the interests of Executives and shareholders and encourage long-term shareholding and commitment to the company.
Operation
Opportunity
Performance conditions and period
Executive Directors are expected to build up a 
shareholding in the company. 
Executive Directors are expected to reach  
the guideline within five years from the date  
of appointment. 
Post-employment shareholding: Executive 
Directors are expected to retain their 
shareholding guideline (or actual holding if  
lower) for two years following stepping down  
as an Executive Director. This provision does  
not apply to any shares purchased by the 
Executive Director.
The target holding is currently 450% of base salary 
for the Chief Executive Officer and 300% of base 
salary for other Executive Directors.
Not applicable
Annual report and accounts 2022 Pearson plc 115

Notes to the policy table
Selection of performance measures and target setting
In the selection and weighting of performance measures for the annual and long-term incentive awards, the Committee takes into account Pearson’s 
strategic objectives and short and long-term business priorities.
Annual incentive plan
For 2023, the Committee identified sales, adjusted operating profit, free cash flow and key strategic measures as being 
relevant measures of Pearson’s performance against its shorter-term strategic objectives and business priorities. Further 
details on how these performance measures align to Pearson’s strategy are set out in the remuneration report.
Long-term  
incentive plan
For 2023 LTIP awards, the Committee has judged the following to be most closely matched to sustained delivery of 
strategy and alignment with shareholders’ interests:
 
— Adjusted earnings per share (30%) rewards the delivery of the desired outcomes from our strategic growth 
objectives and is imperative if the company is to improve our total shareholder return and our return on capital.
 
— Return on capital (30%) is a measure of how efficiently Pearson generates returns from its asset base and is 
considered a fair and robust assessment of management’s performance given the current structure of the business.
 
— Relative total shareholder return (30%) is used as the Committee believes, in line with many of our shareholders,  
that part of Executive Directors’ rewards should be linked to long-term performance relative to comparable  
global companies.
 
— An Environmental, Social and Governance measure (10%) has been selected to reflect that progression of 
Environmental, Social and Governance priorities are integral to the long-term sustainable growth of the business. 
Performance targets are set to provide a careful balance between upside opportunity and downside risk and are normally set in accordance with the 
company’s operating and strategic plans, while also considering analyst consensus to reflect market expectations.
Pre-existing commitments 
The Committee reserves the right to make remuneration payments and payments for loss of office (which includes exercising related discretions) that 
are not in line with this policy if the terms of the payment were agreed:
 
— before the policy came into effect, if the payment was agreed or made in line with the policy in force at the time or was otherwise approved by 
shareholders; and
 
— at a time when the recipient was not subject to the policy, provided the Committee does not consider the payment to have been made in 
consideration of the recipient becoming subject to the policy.
For these purposes ‘payment’ means any payment that would otherwise be subject to the policy and, in relation to a share award, will not be 
considered to have been ‘agreed’ any later than the date of grant. 
Remuneration policy for other employees
Pearson has a set of remuneration principles that govern pay for the whole organisation, although how these principles are applied varies by business 
need, level and geography as required. The key difference in remuneration for Executive Directors compared to the approach to remuneration across 
the workforce is that remuneration for Executive Directors is more heavily weighted towards variable pay and linked to the delivery of Pearson’s 
strategic objectives and short and long-term business priorities.
Further details on remuneration across the workforce at Pearson are set out in the remuneration report on page 100.
Pay and performance scenario analysis
The charts below illustrate what each Executive Director could expect to receive under the 2023 policy in different performance scenarios. The relative 
weighting of fixed and performance-related remuneration and the absolute size of the remuneration packages for the Chief Executive Officer and the 
Chief Financial Officer is shown. Consistent with its policy, the Committee places considerable emphasis on the performance-linked elements (the 
annual and long-term incentives) and will continue to review the mix of fixed and performance-linked remuneration on an annual basis.
Directors’ remuneration report continued
Chief Executive (Andy Bird) $000
Chief Financial Officer (Sally Johnson) £000
100%
29%
17%
13%
29%
33%
27%
43%
50%
40%
20%
$1,949
$6,800
$11,652
$14,563
Fixed Pay
AIP
Share price appreciation
LTIP
Maximum
Maximum plus 
50% share price 
appreciation 
Minimum 
Target
100%
32%
19%
15%
27%
32%
26%
41%
48%
39%
20%
£662
£2,055
£3,449
£4,284
Maximum
Maximum plus 
50% share price 
appreciation 
Minimum 
Target
Fixed Pay
AIP
Share price appreciation
LTIP
116 Pearson plc Annual report and accounts 2022
Performance scenario
Elements of remuneration and assumptions
Maximum plus 50% share 
price appreciation
 
— Fixed pay
 
— Maximum individual annual incentive (300% of base salary for Chief Executive and 200% of salary for Chief 
Financial Officer)
 
— Maximum value of 2023 LTIP award (450% for Chief Executive and 300% of salary for Chief Financial Officer) with 
50% share price growth assumed
Maximum
 
— Fixed pay
 
— Maximum individual annual incentive (300% of base salary for Chief Executive and 200% of salary for Chief 
Financial Officer)
 
— Maximum value of 2023 LTIP award (450% for Chief Executive and 300% of salary for Chief Financial Officer) with 
no share price growth assumed
Target
 
— Fixed pay
 
— 50% of the maximum individual annual incentive
 
— 50% of the maximum value of 2023 long-term incentive award with no share price growth assumed
Minimum
 
— Fixed pay only
Note 1: Fixed pay includes 2023 base salary ($1,293,750 for the Chief Executive and £557,225 for the Chief Financial Officer); allowances and benefits are the actual amounts incurred in the 
2022 financial year. Retirement benefits for both Executive Directors are included at 16% of their base salary.
Note 2: The value of long-term incentives does not take into account dividend awards that are payable on the release of LTIP shares.
Recruitment
The Committee expects any new Executive Directors to be engaged 
on the same terms and to be awarded variable remuneration within 
the same normal limits and subject to the same conditions as for the 
current Executive Directors outlined in the policy.
The maximum level of variable remuneration which may be awarded 
(excluding any ‘buyout’ awards) in respect of recruitment is 750% of 
salary, which is in line with the current maximum limits under the 
annual and long-term incentive.
In setting the basic salary for any new Executive Director, the 
Committee will apply a level appropriate to recruit a suitable 
candidate, having regard to the factors set out in the policy table. 
The Committee recognises that it cannot always predict accurately 
the circumstances in which any new Directors may be recruited.  
The Committee may determine that it is in the interests of the 
company and shareholders to secure the services of a particular 
individual which may require the Committee to take account of  
the terms of that individual’s existing employment and/or their 
personal circumstances. The Committee may do this in the  
following circumstances:
 
— Where an individual is relocating in order to take up the role, in 
which case the company may provide certain benefits such as 
reasonable relocation expenses, accommodation and assistance 
with visa applications or other immigration issues and ongoing 
arrangements such as tax equalisation, annual flights home, 
schooling and housing allowance.
 
— Where an individual is required to forego compensation to take 
up the appointment or forfeits outstanding variable pay 
opportunities or contractual rights at a previous employer as a 
result of appointment, the Committee may offer compensatory 
payments or awards, in such form as the Committee considers 
appropriate taking into account all relevant factors including 
where applicable the form of compensation or awards, expected 
value and vesting time-frame of forfeited opportunities. The 
Committee would require reasonable evidence of the nature and 
value of any foregone or forfeited amounts and would, to the 
extent practicable, ensure any compensation was provided on a 
like-for-like basis and was no more valuable than the foregone or 
forfeited amounts.
 
— Where an individual incurs legal or other professional fees in 
connection with their appointment as an Executive Director, the 
Committee retains the discretion to compensate for these.
In making any decision on any aspect of the remuneration package 
for a new recruit, the Committee would balance shareholder 
expectations, current best practice and the requirements of any  
new recruit and would strive not to pay more than is necessary to 
achieve the recruitment. The Committee would give full details of the 
terms of the package of any new recruit in the next annual 
remuneration report.
Where an existing employee of the company is promoted to the 
Board, the company may honour all existing contractual 
commitments including any outstanding share awards and benefits, 
including retirement benefits. 
Pearson expects any new Chair or Non-Executive Director to be 
engaged on terms that are consistent with the general remuneration 
principles outlined in the relevant sections of this Policy. 
Service contracts and termination provisions
In accordance with long established policy, all Executive Directors 
have service agreements under which, other than by termination in 
accordance with the terms of these agreements, employment 
continues indefinitely.
There are no special provisions for notice or non-share-based 
compensation in the event of a change of control of Pearson.
The Chair and other Non-Executive Directors serve under letters  
of appointment.
It is the company’s policy that the company may terminate the Chair’s 
letter of appointment and the Executive Directors’ service 
agreements by giving no more than 12 months’ notice. Other 
Non-Executive Directors letters of appointment do not contain 
provision for notice periods or compensation if their appointments 
are terminated.
Payment in lieu of notice
As an alternative, for Executive Directors the company may at its 
discretion pay in lieu of that notice. Payment in lieu of notice may be 
made in equal monthly instalments from the date of termination to 
the end of any unexpired notice period. Payment in lieu of notice in 
instalments may also be subject to mitigation and reduced taking into 
account earnings from alternative employment.
For Executive Directors, payment in lieu of notice comprises 100% of 
the annual salary at the date of termination and the annual cost to 
the company of providing pension and all other benefits. For the 
Chair, payment in lieu of notice comprises 100% of the annual fees at 
the date of termination. 
The company may, depending on the circumstances of the 
termination, determine that it will not pay the Director in lieu of 
notice and may instead terminate a Director’s contract in breach and 
make a damages payment, taking into account as appropriate the 
Director’s ability to mitigate his or her loss. 
Annual report and accounts 2022 Pearson plc 117

The company may also pay an amount considered to be reasonable 
by the Remuneration Committee in respect of fees for legal and tax 
advice and outplacement support for the departing Director. The 
Committee reserves the right to make any other payments in 
connection with a Director’s cessation of office or employment where 
the payments are made in good faith, in discharge of an existing legal 
obligation (or by way of damages for breach of such an obligation) or 
by way of settlement of any claim arising in connection with the 
cessation of a Director’s office or employment.
Share awards
On cessation of employment, treatment of unvested shares awards 
will be determined based on the rules of Pearson’s share plans.
In respect of unvested deferred annual incentive awards, these will 
ordinarily subsist, except in circumstances where an individual is 
summarily dismissed. Awards would ordinarily vest on the original 
vesting date/be released in line with normal time horizons unless 
determined otherwise by the Committee. 
In respect of unvested long-term incentive awards, unless otherwise 
provided for under the rules of Pearson’s discretionary share plans, 
Executive Directors’ entitlements would lapse automatically. In the 
case of death, injury, disability, ill-health or redundancy (as 
determined by the Committee), where a participant’s employing 
business ceases to be part of Pearson, or any other reason if the 
Committee so decides in its absolute discretion:
 
— awards will stay in force as if the participant had not ceased 
employment and shall ordinarily vest on the original vesting date/
be released in line with normal time horizons subject to 
performance conditions.
 
— the number of shares that are released shall be pro-rated for  
the period of the participant’s service in the vesting period 
(although the Committee may in its absolute discretion waive or 
vary the pro-rating).
In determining whether and how to exercise its discretion under 
Pearson’s discretionary share plans, the Committee will have regard 
to all relevant circumstances distinguishing between different types 
of leaver, the circumstances at the time the award was originally 
made, the Director’s performance and the circumstances in which 
the Director left employment.
The rules of Pearson’s discretionary share plans also make provision 
for the treatment of awards in respect of corporate activity, including 
a change of control of Pearson. The Committee would act in 
accordance with the terms of the awards in these circumstances, 
which includes terms as to the assessment of performance 
conditions and time apportionment.
Annual bonus
On cessation of employment, Executive Directors may, at the 
Committee’s discretion, retain entitlement to a pro rata annual 
incentive for their period of service in the financial year prior to their 
leaving date. Such payout will normally be calculated in good faith on 
the same terms and paid at the same time as for continuing 
Executive Directors.
Other elements of remuneration
Eligibility for allowances and benefits including retirement benefits 
(other than pension payments in connection with subsequent 
retirement) normally ceases on retirement or on the termination of 
employment for any other reason.
The termination provisions described above may be varied to the 
extent necessary to comply with applicable laws, including taxation 
laws in the United States.
Individual service agreements and letters of 
appointment
Details of each individual’s arrangement are outlined in the table 
below. Employment agreements for other employees are determined 
according to local labour law and market practice.
Position
Date of letter /
agreement
Notice period
Compensation on 
termination of 
employment by the 
company without 
notice or cause
Chair
Omid 
Kordestani,
16 December 
2021
12 months 
from the 
Director; 12 
months from 
the company
Payment in lieu of 
notice of 100% of 
annual fees at the 
date of 
termination
Executive 
Directors
Andy Bird,
23 August 
2020
Sally Johnson, 
15 January 
2020
6 months 
from the 
Director; 12 
months from 
the company
Payment in lieu of 
notice of 100% of 
annual salary at 
the date of 
termination and 
the annual cost of 
pension and all 
other benefits
Note 1: Under payment in lieu of notice, the annual cost of pension for Executive 
Directors is normally calculated as the sum, where applicable, of: an amount equal to 
the company’s cost of providing the Executive’s pension under the pension plan based 
on the Future Service Company Contribution Rate for the relevant section of the 
pension plan as stated in the most recent actuarial valuation (as at the date of 
termination of employment) as limited by the earnings cap; and any cash allowance in 
lieu of pension or to take account of the fact that pension benefits and life assurance 
cover are restricted by the earnings cap. 
Executive Directors’ non-Executive Directorships
The Committee’s policy is that Executive Directors may, by agreement 
with the Board, serve as non-executives of other companies and 
retain any fees payable for their services.
Consideration of employment conditions  
across Pearson
Under the Committee’s charter and terms of reference, the 
Committee’s remit includes determining remuneration for the Chief 
Executive Officer, other Executive Directors and other members of 
the Pearson Executive Management team. In addition, the 
Committee’s remit includes oversight of certain remuneration 
matters below this level and review of remuneration policies and 
practices across the broader employee population. 
When determining remuneration for Executive Directors and other 
members of the Pearson Executive Management team, the 
Committee considers reports from the Chief Executive and Chief 
Human Resources Officer on pay and conditions for the broader 
employee population, including information on the recruitment and 
retention of talent, general pay trends in the market and the level of 
pay increases and incentives across the company as a whole. This 
helps to ensure that remuneration for senior management is 
considered in the context of the wider organisation.
There are a number of established channels for consulting with 
employees and employee representative bodies – including trade 
unions and works councils in some jurisdictions – about the 
company’s strategy, competitiveness and performance of the 
business and other matters affecting employees. The views of 
employees are also sought via the Employee Engagement Network, 
feedback from which is reported to the Board, and engagement 
surveys. These activities provide employees with the opportunity to 
express how they feel about working for Pearson, what they think 
about the work they do, the opportunities they have and the rewards 
(including pay and benefits) they get.
The Committee has not consulted directly with employees on the 
development of the Directors’ remuneration policy.
Directors’ remuneration report continued
118 Pearson plc Annual report and accounts 2022
Consideration of shareholder views
The company consults regularly with shareholders on all matters 
affecting its strategy and business operations. This includes executive 
remuneration. Over the last year, whilst developing the 2023 policy 
and considering its implementation, the Remuneration Committee 
has engaged extensively with shareholders to ensure remuneration 
for Executive Directors is set appropriately, rewards for performance 
and aligns management with the shareholder experience.
This engagement exercise included writing to and meeting with many 
of Pearson’s shareholders and their advisors, to seek their input on 
the proposed changes to the policy. We would like to thank our 
shareholders for the time they have spent with us in this regard. All 
feedback received, which reflected a significant range of opinions, 
was duly considered by the Remuneration Committee as it finalised 
the 2023 policy. Further details on the shareholder engagement 
exercise can be found in my letter on pages 90-91.
The Committee continues to monitor and respond to best practice 
guidelines published by shareholders and their representative 
bodies. Pearson remains committed to an open and transparent 
dialogue with its shareholders.
Policy table for Chair’s and Non-Executive Directors’ remuneration
The table below summarises the policy with respect to remuneration of the Chair and Non-Executive Directors.
Chair and Non-Executive Director remuneration
Purpose and link to strategy
 
— To attract and retain high-calibre individuals, with appropriate experience or industry-relevant skills, by offering market competitive fee levels
Operation
Opportunity
Performance conditions and period
The Chair and Deputy Chair are paid a single fee 
for all of their responsibilities.
The Chair and Deputy Chair fee is set at a level 
that is competitive considering similar positions in 
comparable companies.
The Non-Executive Directors are paid a basic fee. 
The Committee Chairs, members of the main 
Board Committees and, if relevant, the Senior 
Independent Director are paid an additional fee to 
reflect their extra responsibilities. Fees for 
Non-Executive Directors are determined by the 
full Board having regard to market practice.
Additional fees or other payments may be paid to 
reflect additional responsibilities, roles or 
contribution, as appropriate.
The Chair, Deputy Chair and Non-Executive 
Directors are not eligible to participate in any 
annual or long-term incentive, nor are they 
entitled to any retirement or other employee 
benefits. Selected benefits may be introduced, if 
considered appropriate.
The company reimburses travel and other 
business expenses and any tax incurred thereon, 
if applicable. 
Normally a minimum of 25% of the Chair’s, Deputy 
Chair’s and Non-Executive Directors’ basic fee is 
paid in Pearson shares that they have committed 
to retain for the period of their directorships. 
Shares are normally acquired quarterly at the 
prevailing market price with the individual’s 
after-tax fee payments.
Fee levels are reviewed on a periodic basis.
The total fees payable to the Non-Executive 
Directors (excluding the Chair) are subject to the 
limit set out in the Articles of Association of the 
company (currently £750,000) and as increased by 
ordinary resolution from time to time.
None.
The Directors’ Remuneration Report was approved by the Board on 15 March 2023 and signed on its behalf by: 
Sherry Coutu CBE
Chair of Remuneration Committee
Annual report and accounts 2022 Pearson plc 119