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Perspectives
On the Board's Agenda
Top of mind topics for board members
Board-briefing articles that examine a single topic in detail with perspectives from Deloitte subject matter specialists.
2025 board agenda trends, challenges, and opportunities
January 2025
In 2025, boards should consider being alert to the many challenges and opportunities that the year may bring—and agile enough to enable their companies to address those challenges and make the most of those opportunities. This edition of On the Board’s Agenda explores some of the more critical challenges and opportunities and how they may affect companies and their boards.
Looking back at a look forward
December 2024
This edition of On the Board’s Agenda reviews the key risks and opportunities that boards faced in 2024, emphasizing the importance of an enterprise risk management approach. As we end this year, we expect the array of risks and opportunities faced by boards in 2025 will resemble what they confronted in 2024. However, due to the dynamic governance landscape, we also expect the nuances around these issues will evolve. The developments of 2024 highlight those risks—whether they be geopolitical, technological, or regulatory—may not always fit into distinct categories. For boards, there could be value in keeping the interconnected relationships of these issues top of mind. Boards that adopt a more integrative oversight approach could be better positioned to navigate the increasingly complex business landscape.
Brand and reputation stewardship
September 2024
As stewards of long-term value for shareholders and other stakeholders, boards that effectively oversee the enterprise’s brand and reputation could see outsized benefit. This edition of On the Board’s Agenda offers strategies for boards to effectively navigate this aspect of their oversight responsibilities. When considering a strategic approach, directors will likely have to contend with a diverse array of factors—some of which may extend far beyond traditional board concerns. Because the impact of brand and reputation can affect the whole enterprise, these elements are interconnected. That’s one reason why a cross-functional oversight approach may offer outsized value.
Variance in succession strategy and transition processes
July 2024
Succession planning can vary greatly from one company to the next. In this abbreviated edition of On the Board’s Agenda, we combine survey data on succession planning strategies to explore variance in responses provided by CEOs and corporate secretaries. They were separately asked to identify who was involved in 1) crafting a succession strategy and 2) then using it for a CEO transition. They then indicated whether the board of directors and/or CEO were involved in each step of the succession planning process.
Embracing disruption: The board’s role in championing innovation to capture potential
June 2024
In today's rapidly evolving business landscape, innovation powers the heartbeat of progress. As new technologies disrupt traditional industries and consumer preferences shift seemingly overnight, organizations that thrive are those that embrace change.
Yet, corporate boards may underestimate their strategic role in fostering these crucial adaptations. Conversations on technology disruption are often initially focused on backend operations (and efficiency), rather than proactive forces to drive seismic organizational shifts, catalyzing profound innovative transformation.
Governance of transformation amid an uncertain business climate
April 2024
Volatility wrought by a pandemic, economic upheavals, and geopolitical conflict—to name just a few challenges of late—have added a suite of new risks for boards to navigate. Finding a way through such turbulent waters isn’t easy. But according to Deloitte’s MarginPLUS 2024 Survey, a growing number of companies are charting a course with the help of transformation initiatives focused on margin improvement programs.
Regardless of form, transformation initiatives may involve large-scale changes that aim to bolster efficiency, reduce manual processes, and otherwise modernize business operations. Their scale and scope can be different across industry as can the governance processes.
Questioning technology governance orthodoxy
March 2024
Formerly a siloed and specialized topic, technology has become interwoven throughout many facets of governance. Yet even for the tech-savvy, strategizing around the increasingly rapid pace of advancement could prove challenging.
Deloitte’s Tech Trends 2024 may be useful for boards looking to separate the signal from the noise of current technology dialogues. According to the report, upcoming technology advancements are poised to fundamentally change how humans and machines interact in the workplace (and beyond). The board’s technology oversight processes may not be prepared for that kind of potential shift, but steps can be taken to reassess technology governance.
Living in "interesting" times: The 2024 board agenda
January 2024
Over the course of the next year, board members could find themselves living in interesting times. The Oxford English Dictionary defines interesting as “having the qualities which rouse curiosity or engage attention,” which seems an apt characterization for 2024.
At present, the world continues to grapple with macro-level issues such as geopolitical risks and economic volatility. Advances in technology and other business processes continue to open the door to numerous new opportunities and risks. And because of these forces, to reiterate the point: Governance seems poised to become even more interesting.
Holistic governance through technology transformation
September 2023
In the age of artificial intelligence (AI) and similar innovations, the board’s governance of technology has garnered increasing levels of attention. But the rapid pace of advancement has brought a shifting set of new (and often unfamiliar) opportunities and risks.
This edition of On the board’s agenda features a conversation with Joanna Burkey, chief information security officer at HP Inc. and board member at Overstock.com/Bed Bath & Beyond, and Irfan Saif, Deloitte’s US chief information officer and member of Deloitte US Board of Directors and Deloitte Global Board of Directors, on how to govern holistically through transformative technological change.
The never-ending story: CEO succession planning
May 2023
The CEO is usually the most visible and prominent position within a company. The board’s role in CEO succession planning is a unique role and one of the highest-priority activities in which they engage. When things go well, an effective succession planning strategy can result in a CEO with transformative leadership potential who executes on the company’s long-term vision and adds value for shareholders and other stakeholders.
Board governance and strategy in a changing global economic landscape
April 2023
The recovery from the pandemic has been uneven at best, and it brought its own challenges—chief among them inflation. Board-level strategy around such issues often requires weighing a proverbial constellation of economic data. While cost cutting is often the “standard playbook” response in this area, there is value in weighing all the options available to promote economic resiliency. Periods of volatility are also an opportunity for boards to reaffirm their stewardship commitments. Such actions can pay dividends in social capital – a return on investment that, while not measured in dollars, can be just as valuable.
Rethinking how tech trends shape governance and oversight
February 2023
Deloitte’s 2023 Tech Trends report offers a navigational framework for boardroom conversations in this area and specifically suggests a holistic governance approach where leverage of technology is based on the business use case rather than its perceived novelty or innovativeness.
The 2023 board agenda
January 2023
In this edition of On the board's agenda, we discuss some of the critical topics like board composition, technology, workplace, climate, organizational strategy and risks, and finally the board itself, that have remained relatively constant in the past five years, as well as new and emerging topics that will likely be on the board’s agenda in 2023.
Archived editions
Prioritizing human capital—modern challenges and the board’s role
November 2022
Many corporate boards are devoting increasing amounts of time to one of their most important assets, their workers. Profound, disruptive shifts in the marketplace and worker expectations coupled with growing demands for transparency and action on environmental, social, and governance issues, are elevating a variety of human capital risks and opportunities to boardroom discussions.
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Supply chain strategies: For many companies, the traditional balance is shifting
October 2022
The path to a new equation for supply chain management is an important balancing act for boards to understand and oversee. With its deep understanding of strategy and risk spanning the enterprise, boards are in the optimal position to hold C-suite leaders accountable for considering the company’s mission and strategy and synchronizing a supply chain ecosystem that balances a multitude of sensitive factors.
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In M&A, how can boards help companies avoid the synergy trap?
September 2022
Mergers and acquisitions offer one way that shareholder value can be increased. By exercising their responsibilities and providing advice and perspective, boards can help increase shareholder value, reduce tension within the organization, and ultimately improve the odds of success in M&A efforts.
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The private company board: A director’s perspective
August 2022
Lynn Nowicki Clarke, an experienced private company board member, shares her views on how private company boards face many of the same growing and seemingly endless array of new and long-standing challenges as public companies.
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Leading practices in board interviews
July 2022
An important early step in pursuing a new board opportunity—whether new to board service or a seasoned director—is preparing for the interview process. In the current environment, what can candidates expect, and how can they prepare?
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A new chapter in cyber
June 2022
An SEC proposal issued in March 2022 to enhance and standardize disclosures regarding cybersecurity risk management, strategy, governance, and incident reporting has sparked increased discussions about cyber risk in many corporate boardrooms. The importance of the board’s role in promoting a cyber-focused mindset and a cyber-conscious culture throughout the organization cannot be overstated. The board’s oversight role is a fundamental aspect of governance, which includes defined strategies, policies, and procedures to mitigate cyber risk.
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Amid geopolitical complexity, uncertainty persists
May 2022
As corporate boards carry out their responsibility to oversee management’s execution of operational, growth, and strategic objectives, they need to consider the many geopolitical and economic issues on the horizon and the possible consequences for their companies. A strategic approach to risk intelligence that leverages scenario planning and advanced risk-sensing techniques may become important for helping companies navigate significant uncertainty.
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From next-generation to now: Digital assets
April 2022
An incremental movement into cryptocurrencies can help a company develop a road map for broader adoptions that support the company’s strategy and growth objectives. Adoption will require new processes and controls that span departments. A collaborative effort of the board and its committees with management leaders across the enterprise is critical to help each company prepare for the journey.
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What’s all the buzz about the metaverse?
March 2022
The metaverse is a hot topic of discussion in technology circles, and a growing number of consumers and consumer brands are getting on board. Some major companies are placing big bets on the metaverse, or unlimited reality, to fundamentally change the way people interact. As a result, the metaverse is escalating quickly to a topic for boards to address as they consider their companies’ growth and talent strategies, opportunities, and risk profiles.
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Tech-savvy board members: A common language for transformation and the impact on performance
February 2022
While it seems reasonable to consider whether a board has the requisite technology skill sets, there has been little, if any, data concerning the impact of having a tech-savvy board on the company’s performance. A study completed by Deloitte Consulting LLP in 2021 analyzed how the “techcentricity” of the board impacts the company’s performance. There may also be an opportunity for a common language around transformation and technology.
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Director survey: How the pandemic has set new M&A priorities
December 2021
The latest survey, conducted jointly between the National Association of Corporate Directors (NACD) and Deloitte, found that boards are giving M&A activity greater attention earlier in the process, ensuring that a company’s deal strategy is right and that diligence is done properly. The flip side is that they are giving less granular attention to integration planning and to longer-term efforts to assess deal success. Directors also are putting new emphasis on environmental, social, and governance (ESG) considerations in M&A, responding to growing demands from diverse stakeholders and the increased attention management teams are giving these issues.
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Considerations and priorities for boards in governing, monitoring, and measuring sustainability
November 2021
The board’s role in governing, monitoring, and measuring sustainability has become increasingly necessary and complex. Deloitte US Sustainability and Climate Change leader Scott Corwin and Center for Integrated Research senior manager Derek Pankratz sit down with accomplished sustainable business scholar, Tensie Whelan to discuss considerations and priorities for boards.
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Business not as usual: How the Breakthrough Manifesto and Business Chemistry® can help boards navigate uncertainty
September 2021
Just as we all were ready to shelve terms like “unprecedented times,” the human-centered world is seemingly shifting on its axis again. Continued pandemic hurdles, an increasingly hybrid workforce, and the increasing complexity of the board’s role all mean boardroom dynamics are more critical than ever. As they grapple with ongoing uncertainty, some boards are challenged by tensions with management, or even factions within the boardroom, while others are looking to achieve greater effectiveness by better tapping into their diverse viewpoints and styles. When thorny problems arise, a few principles from the Deloitte Greenhouse may help boards prevail, offering some key tools that could be differentiators for the enterprise.
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An alternate universe: The small, young company board
July 2021
Corporate law treats all directors alike; the same standards apply to all directors, regardless of the size, maturity, or other characteristics of the companies on whose boards they serve. All directors have the same fiduciary duties of due care and loyalty, are protected by the business judgment rule, and are expected to engage in rigorous oversight.
However, all companies are not created equal. Size and maturity are among several significant differentiating factors among companies. There are many ways in which small, young companies differ from large, mature ones. Small companies have far fewer resources and may therefore find it harder to be resilient when faced with regulatory, economic, and other challenges. In addition, small companies—particularly those in early stages of growth—may need ongoing infusions of capital to stay alive, much less to grow and thrive. And they may also have less mature and robust systems and processes, including those relating to internal controls.
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Trust: A critical asset
May 2021
The responsibilities of boards of directors continue to evolve and increase, particularly given the events of the past year. In addition to perennial topics such as strategy, succession, financial reporting, compliance, and culture, boards are experiencing broader demands on their oversight from expanding stakeholder and shareholder considerations; continuing challenges of the ongoing global pandemic and its aftermath; and addressing the changing role of the corporation in society at large on matters such as racial justice and climate. The growth in the number and complexity of board responsibilities is taking place in an environment of growing skepticism towards our various institutions.
Against that background, companies and their boards can help to address these multiple challenges by considering one of the most critical assets not on their balance sheets―trust.
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Incorporating ESG measures into executive compensation plans
April 2021
With the 2021 proxy season underway, environmental, social, and governance (ESG) topics are dominating the conversation. While dialog between companies, investors, and other stakeholder groups has accelerated on a variety of ESG topics, the role of ESG in long-term value creation had already been steadily increasing. According to a recent study, investors that collectively manage $17.1 trillion in US-domiciled assets have adopted sustainable investing strategies, which integrate ESG criteria within investment decisions. Sustainable investing has increased nearly 43% since 2018, demonstrating that the incorporation of ESG considerations into investment decisions has gained significant traction. Many companies now recognize that developing and implementing an ESG strategy is more the norm than an exception and are evaluating how best to demonstrate progress through robust measures and enhanced disclosures.
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Get ready: How boards can prepare for activism’s next wave
February 2021
As we begin to see the light at the end of the tunnel of a pandemic that upended all of our lives and disrupted almost every business, activist investors are getting in gear, and the pieces are expected to be in place for continued growth in merger and acquisition activity through 2021. Political unrest, accelerating social change, and renewed emphasis on corporate purpose beyond shareholder primacy will continue to shape the future and inject uncertainty. Our world is literally changing before our eyes, and we have to ask ourselves, how will this affect shareholder activism in 2021 and beyond, and what will the impact be on M&A activity? And how have the events of 2020 changed what board directors need to do to be prepared for M&A generally and to deal with activists that might emerge?
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The 2021 boardroom agenda: Never let a good crisis go to waste (and more)
January 2021
It seems likely that 2020 will be viewed as one of the most consequential years in recent memory. In addition to dealing with an ongoing global pandemic and the massive economic and social dislocations it caused, the United States has had to address natural disasters such as major hurricanes and wildfires, racial unrest, and a lengthy and challenging political campaign, among other things. While the challenges of any year often influence boardroom agendas for the following year, the impact of 2020 on 2021 board agendas will almost certainly be extraordinary. At the same time, boards will need to deal with many perennial areas of board oversight, including strategy, financial reporting, compliance, and culture. This On the board’s agenda discusses some of the many issues, old and new, that boards will likely have to contend with in the coming year.
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Time to act: Applying discretion to outstanding incentive awards in the era of COVID-19
December 2020
When COVID-19 first began impacting the US economy, many companies faced unclear financial forecasts and uncertainty on whether incentive plans would appropriately reward executives and employees for their contributions, pre– and post–COVID-19. Rather than overhaul in-flight incentive plans at a time of great uncertainty, many companies decided to take a “discuss now, act later” approach.
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Cyber: New challenges in a COVID-19 - disrupted world
November 2020
Cyber, and the challenges it presents to businesses of all types and sizes, was on the board’s agenda well before the onset of the COVID-19 pandemic. Many boards, including their committees, engaged in a wide range of activities to stay informed and vigilant on the topic. As a result, these boards had reason to believe that they were exercising an appropriate degree of oversight regarding cyber
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The workforce takes center stage: The board’s evolving role
September 2020
As organizations respond to recent events related to COVID-19 and social justice movements, many strategic business, operating, and investment plans for 2020 and beyond have become irrelevant, impracticable, or both. These events have challenged the status quo. As a result, for boards and managements, the ability to lead in highly adaptable and decisive ways is now on the front burner.
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ESG and corporate purpose in a disrupted world/h3>
July 2020
Even before the world was disrupted by COVID-19 and current events calling for a greater focus on social justice, corporate America was already at an inflection point with respect to its role in society, facing louder and more widespread calls for businesses to consider a broader range of stakeholders.
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The board’s role in guiding the return to work in the future of work
July 2020
We began discussing this publication in January 2020, before global pandemic and social unrest became central topics of everyday conversation. The impact of COVID-19 is devastating at the individual, local, national, and global level. It has created huge immediate changes to how and where people interact, and how business is done. For many organizations, it has also thrust the future of work (FOW) to the forefront, as management and workers grapple with changes today and prepare for a different and uncertain tomorrow.
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What the board needs to know about blockchain technology
June 2020
Now more than ever before, there has been an increased focus on how new technologies can improve existing business processes. Blockchain is one such technology. The unique capabilities of a blockchain can increase the transparency, record integrity, efficiency, and effectiveness of transaction processing and recording.
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Governing through the pandemic
May 2020
It is too soon to know whether, how, and to what extent the COVID-19 pandemic will lead to permanent changes—the “next normal”—in how companies are governed or if, post-pandemic, we will go back to the way things were just a few short months ago. In the meantime, governing through the pandemic and the post-pandemic recovery raises a host of new challenges, while also offering potential opportunities.
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The atmosphere for climate-change disclosure
March 2020
Discussions and debates regarding the importance of environmental, social, and governance (ESG) disclosure have continued their fastpaced trajectory over the past several months. In January 2020, the CEO of the world’s largest asset manager stated, “... we will be increasingly disposed to vote against management and board directors when companies are not making sufficient progress on sustainability-related disclosures and the business practices and plans underlying them.”1
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1Larry Fink, CEO, BlackRock, CEO letter: A fundamental reshaping of finance, January 14, 2020
The strategic audit committee: A 2020 preview
January 2020
To anyone familiar with the role and responsibilities of audit committees, it will come as no surprise that the audit committee is sometimes called the “kitchen sink” committee. That is because at many companies, any topic that isn’t clearly the responsibility of another committee or the full board frequently ends up on the audit committee agenda.
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The 2020 boardroom agenda: More topics, more oversight
January 2020
The role of the board of directors and its committees is rapidly and constantly expanding. New matters seem to arise all the time, and the board is viewed, in the court of public opinion if not in courts of law, as being responsible for everything the company does or does not do. As both a result and an example of this perception of the board’s role, it is not surprising that when anything negative happens to a company, the first question asked is often “Where was the board?”
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International taxes: Seismic changes may be coming
December 2019
After decades of operating within a generally stable international tax regime, multinational companies have more recently seen a flurry of activity, thanks to a global focus on profit shifting and the US 2017 tax overhaul. With the potential for international tax rules to undergo seismic shifts in the next several years, board members would do well to keep an eye on the work being performed at the Organisation for Economic Co-operation and Development, or OECD.
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What the board needs to know about the future of mobility
December 2019
The transformation to a new mobility ecosystem—the "future of mobility"—is being driven by a series of converging technological and social trends: the rapid growth of shared mobility, including carsharing and ridesharing; the increasing viability of electric and alternative powertrains; new modes of transportation like e-scooters; and the growth of connected and, ultimately, autonomous vehicles (AVs). The result is a new ecosystem of mobility that can offer faster, cheaper, cleaner, safer, more efficient, and more customized travel.
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Outside the four walls: The board’s role in extended enterprise management
November 2019
Companies, including their boards and managements, have long understood that they do not function in a vacuum and that their success depends, at least in part, upon customers, suppliers, employees, and other constituencies. However, there is a growing realization that in the 21st century, companies operate in a greatly expanded and more complex ecosystem with numerous components, many outside their control, that create opportunities and pose risks. As a result of the expansion of their ecosystems, companies increasingly need to think outside the four walls—to reset their front lines—to effectively manage and grow their businesses.
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Stepping in: The board's role in crisis management
September 2019
There are actions boards can take now—and questions they can ask—to give themselves comfort that the organization is prepared to manage a crisis. When the stakes are high and scrutiny is intense, the board has a unique role.
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Board oversight of corporate compliance: Is it time for a refresh?
September 2019
Nearly 25 years have passed since a landmark decision of the Delaware Chancery Court involving the board’s role in compliance oversight. The case was based upon claims that the board in question had breached its fiduciary duty regarding compliance with legal requirements applicable to health care providers, leading to an extensive federal investigation, an indictment charging multiple federal felonies, and fines, penalties, and damages approximating $250 million.
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The tech-savvy board — A director's perspective
September 2019
With the ever-increasing focus on technology—as both a risk and a driver of success—the board’s role in technology oversight is one of the hottest topics in corporate governance today. Bob Lamm, independent senior advisor to Deloitte’s Center for Board Effectiveness, recently spoke with Sherry Smith, an experienced board member with a passion for technology, to get her take on this critical area.
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Trends in executive compensation
September 2019
The 2019 proxy season is largely over for calendar year-end companies, so it is a good time to reflect on a couple of key themes in executive compensation that emerged during the season.Achieving significant shareholder support for “Say on Pay” remains a top priority for issuers.
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2019 Proxy Review
July 2019
In recent years, the role of the audit committee—and, in particular, its oversight of the independent auditor—has been subject to increased scrutiny from regulators, investors, and other stakeholders. The independent auditor is critical to maintaining confidence in the reliability of financial information and, ultimately, in the proper functioning of the capital markets.
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CEO pay ratio: Leading indicator of broader human resource matters?
July 2019
Now that the CEO pay ratio disclosure requirement has been in place for two proxy seasons, it has demonstrated to be less impactful than some proponents and others may have expected. However, pay ratio disclosure may just be the opening salvo in an employee, shareholder, media, and regulators’ demands for additional employee and compensation data.
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Business Chemistry®: A path to a more effective board composition
June 2019
The average board member spends about 245 hours on board matters over the course of a year, according to the 2018–2019 NACD Public Company Governance Survey. However, less than one-third of this time, 74 hours, consists of board member interactions, such as telephonic and in-person board and committee meetings and a handful of board dinners.
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What to expect from auditor reporting of critical audit matters
April 2019
Audit reports for large accelerated filers will include a new section addressing CAMs beginning for audits of fiscal years ending on or after June 30, 2019, and for other public companies in 2020. This will be a dramatic change in auditor reporting and is expected to generate significant media attention, particularly in the first year of adoption. What is the board’s role with respect to CAMs? How are CAMs identified? What is being done to prepare for CAMs and what might boards expect? This edition discusses these questions and highlights considerations for boards in advance of the first auditor reporting of CAMs this summer.
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International taxes: Seismic changes may be coming
December 2019
After decades of operating within a generally stable international tax regime, multinational companies have more recently seen a flurry of activity, thanks to a global focus on profit shifting and the US 2017 tax overhaul. With the potential for international tax rules to undergo seismic shifts in the next several years, board members would do well to keep an eye on the work being performed at the Organisation for Economic Co-operation and Development, or OECD.
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Crisis resilience and the board—Taking risk oversight to the next level
March 2019
Companies seek to anticipate and avoid or proactively mitigate crises that pose risk to their business. As part of their oversight responsibility, boards seek to assist management in carrying out these responsibilities. However, no matter how prepared a company is, and regardless of the levels of management attentiveness and board oversight, crises will happen; they are a matter of when, not if. Because of this reality, it is important for companies, including their management and board, to build resilience.
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Social media and the board
February 2019
No one should be surprised that companies are extensive users of social media. A quick look at nearly any company website, marketing literature, or email signature reveals a group of icons showing the social media platforms on which the company has a presence.
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The 2019 boardroom agenda: Something old, something new?
January 2019
The end of an old year may cause some to heave a sigh of relief—another year is in the rearview mirror. However, board members and those who work with boards may be looking toward the horizon and wondering what challenges may arise in the coming year. Some challenges never seem to go away, and new ones seem to pop up all the time. Even challenges presumed to be over and done with can return, sometimes in a different guise or with a new twist.
A conversation on blowing up best practices
November 2018
Detonate: Why—And How—Corporations Must Blow Up Best Practices (And Bring A Beginner’s Mind) To Survive, was published in 2018 (Wiley). Bob Lamm, an independent senior advisor to Deloitte’s Center for Board Effectiveness, recently sat down with one of its authors, Geoff Tuff, a Deloitte Consulting LLP principal and senior leader in the Innovation and Applied Design Practice, to address key concepts and practical approaches outlined in the book.
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Not if, but how: Evaluating the soundness of your digital transformation strategy
September 2018
Often for businesses to survive in today’s world, the question is no longer whether to consider a digital transformation strategy. Rather, as board members oversee management’s strategy, a more appropriate question may be how: How can our unique organization evolve and work differently to meet the demands of an ever-evolving marketplace?
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Audit committee disclosure in proxy statements—2018 trends
July 2018
Deloitte’s analysis of the 2018 S&P 100 proxies helps to provide transparency into audit committee oversight activities and performance provide a better understanding for investors. Investors and other stakeholders continue to push for greater proxy statement disclosure of both new and existing topics.
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The board’s role in corporate social purpose
July 2018
Corporate social purpose is broader than traditional corporate social responsibility activities and encompasses how the core business delivers positive economic, social, and environmental impact in the world. This On the Board’s Agenda explores how social purpose strategies, programs, and investments can be important assets, and how boards might enhance their oversight of their companies’ social purpose roles and actions.
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Industry 4.0
June 2018
The integration of digital and physical technologies is accelerating, enhancing companies’ ability to increase operational excellence and grow in ways that may not have been possible just a couple of years ago. This phenomenon, known as Industry 4.0, suggests a new revolution that enables smart, connected technologies to transform organizations, operations, and the workforce by increasing information flow, creating new insights, and revolutionizing business models.
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Sustainability and the board: What do directors need to know in 2018?
May 2018
Sustainability, which encompasses environmental, social, and governance (ESG) concerns, is increasingly positioned at the top of board agendas, and is now central to corporate competitiveness and a company’s continued ability to operate. Sustainability affects all sectors and challenges even the most progressive companies and the most thoughtful directors. There are a number of steps boards can consider and questions they can ask to gain a better command of emerging sustainability risks and changing stakeholder expectations.
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Corporate culture risk and the board
April 2018
Recent corporate scandals linked to problematic company cultures have resulted in questions such as "where was the board?" and "shouldn’t the board have known?" In some cases, board members themselves may have wondered why they were not informed of cultural problems and asked, "should we have conducted more due diligence?" These and similar questions, and the responsibility to protect both their companies’ and their own reputations, are leading directors to look for ways to better monitor corporate culture and to understand potential cultural risks and address problems before they get out of control.
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Is it time to review your board of director compensation program?
March 2018
Board compensation is on investors' radar. Unlike compensation for executives, non-employee director compensation is not subject to independent review. While shareholders must approve equity plans in which non-employee directors may participate, and while those plans frequently include limitations on individual equity grants or aggregate pay levels, shareholders are not required to approve the director compensation program as a whole.
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Cyber risk in the boardroom—Accelerating from acceptance to action
February 2018
Cyber risk is a top-level business risk that boards may find challenging to oversee and difficult to address. By using a maturity mode for board stewardship of cyber risk and understanding the actions available at each level of maturity, boards can accelerate their transition from awareness to meaningful oversight.
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The 2018 boardroom agenda—Dealing with challenges old and new
January 2018
Regardless of size, industry and other characteristics, companies frequently face a constant stream of challenges. These can include perennial challenges that require ongoing or periodic attention, as well as new challenges that seem to arise regularly. Developments in 2017 demonstrate the range and depth of the challenges faced by boards. Perennial challenges include strategy, risk, compensation, shareholder engagement, and regulatory uncertainty; evolving challenges include board composition, social responsibility, technology risk, culture risk, and the combination of innovation and disruption. It is likely that some, if not all, of these items could be on the board’s agenda in 2018.
Board oversight of algorithmic risk
November 2017
In recent years, the role of the board has grown to encompass a plethora of technology-related risks and challenges. Although directors have long had oversight responsibility for risk, that responsibility now covers a variety of emerging technology risks. One area of technology risk that has not received much attention to date is algorithmic risk. This issue of On the board's agenda is to help board members understand algorithmic risk and provide tools for overseeing and addressing it.
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Winning with digital—What boards need to know about digital transformation
October 2017
Digital technologies and related business innovations are permeating everything around us—introducing new cultures, changing society, reshaping the competitive landscape, raising customer expectations, disrupting established business models, blurring the lines between industries, and creating unprecedented challenges—and opportunities—for companies everywhere. In light of this, digital transformation is now one of the most important strategic issues on the board's agenda.
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Audit committee disclosure in proxy statements—2017 trends
August 2017
Over the past several years, investors and other governance groups have sought expanded disclosures on how audit committees execute their duties. The SEC has not yet changed audit committee disclosure requirements in response to these efforts, and there is no indication that rule changes are likely any time soon. However, Deloitte's analysis of the 2017 proxies of S&P 100 companies indicates that over the past several years companies have generally increased voluntary disclosures about the role and activities of audit committees.
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Post-merger integration
July 2017
Many mergers and acquisitions, even promising ones, can fall short of delivering anticipated results. And shareholders often rarely pause to litigate. The potential consequences of M&A activity loom large to companies and to their boards. It is commonly in the board's interest to emphasize the importance of, and to oversee, a well-thought out M&A plan, including the often-overlooked post-merger integration.
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Managing brand risk in an age of social media
June 2017
In today's transparent, always-on world, control of brand messaging has shifted from organizations into the hands of increasingly connected consumers. With the touch of a key, consumers have the power to share information about companies instantly on social channels and significantly shape brand perception.
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The role of the board in an age of exponential change
March 2017
In a time of exponential change, both risk and opportunity abound. To survive and thrive, companies need to recognize the opportunities at hand and take deliberate action. Board members have a unique role to play in guiding transformation, challenging the basic assumptions of an organization, and helping foster a positive culture of exploration and experimentation to keep the business evolving as its environment changes.
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Assessing risk in incentive compensation plans
February 2017
While incentives can be powerful tools to properly align employees with the achievement of the company's objectives, boards of directors should consider whether there is a process in place to identify and mitigate the potential risks of incentive programs. Risk assessments need to be conducted annually, comprehensively, and holistically.
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Current trends in audit committee reporting
January 2017
For the past several years, various governance groups and investors have encouraged audit committees to disclose more information on how they execute their duties. Deloitte's latest proxy statement study confirms that voluntary disclosure is increasing at a slow and steady pace. While it is not necessary, or possible, to disclose everything an audit committee does each year in fulfilling its duties, providing additional insight into the structure and key activities of the audit committee can help increase investor confidence in both the audit committee and the company as a whole.
The chief legal officer and the board: Dealing with challenges in a challenging role
November 2016
Being a CLO can pose challenges, particularly those that arise from the complex relationships among the CLO, the board of directors, and the CEO and other members of the management team. Many of the challenges associated with being a CLO stem from the fact that the CLO has two roles that can conflict with each other—an attorney and a member of management.
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Preparing for the new CEO pay ratio disclosure requirement
October 2016
In 2015, the Securities and Exchange Commission (SEC) issued a final rule requiring disclosure of the ratio of chief executive officer (CEO) pay to that of the median employee under Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The disclosure is required for the first fiscal year beginning on or after January 1, 2017, and as such, calendar-year companies will have to provide the ratio beginning with their 2018 annual proxy statement, based on 2017 compensation data. Despite this timeline, it is advisable that management consider providing the Compensation Committee with a preliminary assessment early in 2017, allowing the Committee sufficient time to understand the ratio and the underlying calculation, giving management time to develop its communication strategy (both internal and external).
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Framing strategic risk in the boardroom
September 2016
Accelerated economic cycles. Exponential technological advances. Increased competition. Changing customer demographics and preferences. Increased shareholder activism. New industry and regulatory requirements. Geopolitical uncertainty. The world is rapidly changing at an accelerating pace and these factors, along with many more, pose challenges to effective strategic risk thinking.
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The results are in—A review of the 2016 proxy season
August 2016
Examine the trends that have emerged from shareholder meetings held in the first half of 2016. While some companies hold their annual meetings during the second half of the year, it is likely that the trends identified from the first half of the year represent what we can expect in the future.
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M&A: The intersection of due diligence and governance
May 2016
Merger and acquisition (M&A) activity can be an important component—even a critical one—for a company's growth strategy. A successful acquisition can help a company make a quantum leap in terms of market presence, filling in gaps in a company's product or service portfolio, and improving profitability and other performance metrics. On the other hand, transactions that don't ultimately perform as expected, including not providing positive returns or resulting in large negative surprises, can cause serious damage to companies and their boards of directors, ranging from litigation to the ouster of managements and even board members.
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Board effectiveness: A focus on behavior
March 2016
Shareholders will be voting in many director elections during the 2016 proxy season, doubtlessly including some proxy contests as well as "routine" elections in which the only candidates are those nominated by the companies. Regardless of the nature of these 2016 elections, companies, investors, and regulators collectively recognize the importance of having an effective board of directors, and ever-greater emphasis is being placed on board structure, board composition, and board refreshment by all three groups. Board composition is one of the most critical areas of focus for the board, and if done properly, may be a strategic differentiator. Having the right mix of people who bring diverse perspectives, business and professional experiences, and skills, can provide a foundation for robust dialogue, informed advice, and input in the boardroom.
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Board composition: Greater than the sum of its parts
January 2016
Boards of directors have been around for a long time. So have annual meetings, when shareholders are asked to elect directors, and proxy statements, where information about the candidates' backgrounds and qualifications is provided. Thus, it might be somewhat surprising that board composition has become a very hot topic with investors, regulators, and others in the governance community—as well as in boardrooms.
On the other hand, ongoing regulatory changes, pressure from shareholders and investors, and business model threats are pressuring many companies to examine their board composition. And board composition is extremely important, arguably one of the most critical component of a corporation's governance, so it is only fitting that this is a topic on the board agenda.
Board composition is made up of many parts. Skills and qualifications, independence, diversity, tenure, and refreshment will be outlined as topics for the 2016 board agenda.
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