On the board’s agenda
Top of mind topics for board directors
Explore our regular global publication, on the board’s agenda, highlighting current focus areas for directors
Trust: A critical asset
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 – from expanding stakeholder and shareholder considerations, to addressing the changing role of the corporation on matters such as racial justice and climate. 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.
Incorporating ESG measures into executive compensation plans
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. Many companies now recognise 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.
Get ready: How boards can prepare for activism’s next wave
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 (M&A) 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?
The 2021 boardroom agenda: Never let a good crisis go to waste (and more)
It seems likely that 2020 will be viewed as one of the most consequential years in recent memory. 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.
Time to act: Applying discretion to outstanding incentive awards in the era of COVID-19
When COVID-19 first hit, 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. Now, companies nearing their fiscal year-ends must “act” by determining whether incentive plan designs and performance targets established before the pandemic will reasonably reward executives and employees for their contributions, especially given the many challenges posed by COVID-19.
Cyber: New challenges in a COVID-19 - disrupted world
The pandemic and the many disruptions it has caused have created new challenges for boards to consider. In addition, an increasing focus on areas such as the use of data, privacy, and artificial intelligence (AI) ethics has further expanded the areas that boards need to address. This On the board’s agenda discusses the nature of those changes and how boards can adapt to the new environment, supporting a resilient response to the new challenges and opportunities of cyber.