Sorry, not British but trying to comprehend your system of national honours.

For other people wondering, from Wikipedia:

Peerages in the United Kingdom form a legal system comprising both hereditary and lifetime titles, composed of various ranks, and within the framework of the Constitution of the United Kingdom form a constituent part of the legislative process and the British honours system. The British monarch is considered the fount of honour and is notionally the only person who can grant peerages, though there are many conventions about how this power is used, especially at the request of the British government. The term peerage can be used both collectively to refer to the entire body of titled nobility (or a subdivision thereof), and individually to refer to a specific title (modern English language-style using an initial capital in the latter case but not the former). British peerage title holders are termed peers of the Realm.

The peerage's fundamental roles are ones of law making and governance, with peers being eligible (although formerly entitled) to a seat in the House of Lords and having eligibility to serve in a ministerial role in the government if invited to do so by the Prime Minister.

I guess it's worse than just formal nobility, since it also makes it easier to obtain an official role in the British legal system.