It's a setting that AFAICT only shows up in facetime. When I'm in a facetime call, in the control center there's a new "mic mode" tile (next to the also-facetime-only "video effects" tile that toggles portrait mode). In the mic mode panel there's three options "Standard", "Voice Isolation", and "Wide Spectrum".

I use the voice isolation one and people I've talked to say that it's drastically improved the call quality, particularly while I'm walking next to a busy street.

edit: you can see the setting without actually starting a call, just go into the facetime app and hit "New FaceTime". It will show you a blurred front view camera and let you pick a contact to call, but at that moment you can drag the control center down and they'll be there.

Yeah so when I start a call, I swipe down from the top right and there's a tile that lets you select the mic mode.

This tile shows up when any calling app is active. So it works for FaceTime or even third party apps like Google Meet. Good luck!

It's one of those things hidden in the menu you get when you drag down from the upper right (during a call). I think. I found it once on a video call to my mom, but like the lost city of Atlantis, it seems to have disappeared for me again now that I'm trying to find it again. I hate the iPhone UI, but they work so well most of the time...