Unlike the directors' report, the strategic report is not prescribed by the relevant legislation and, as a result, it may not be suitable; in which case it can be turned off and a custom section imported in Sections setup.

The 'Section 172(1) statement' must explain how the directors have complied with the requirements of Section 172(1) of the Companies Act 2006 (United Kingdom).

The statement is applicable to an entity that meets at least 2 out of 3 of the following criteria:

  • More than £36m turnover
  • More than £18m total assets
  • More than 250 employees

Whilst there is no set structure for the statement, it should cover three broad areas:

  • Identify the issues, factors and stakeholders considered relevant
  • Describe how the directors have ensured they understand the issues (for example by stakeholder engagement)
  • Explain how the directors principal decisions have had regards to this

Refer to the Examples menu for examples of a 'Section 172(1) statement'.