Growth from all directions
This survey, now in its third consecutive year of publication, provides a unique perspective on the concerns that boards of directors face around the world, on a variety of corporate governance matters, ranging from board composition and risk oversight, to the directors’ role in strategy. In addition, this year’s survey expanded to include topics such as regulatory trends and associated perceptions, cyber security, internal audit, compliance, and anti-corruption regulations—among others.
What areas of oversight will boards focus on in the next 12 to 24 months? How do they view the regulatory regimes in their countries? How do directors approach evaluation and improvement of their performance? What new challenges are impacting directors, and do current practices enable boards to address them? Director 360°: Growth from all Directions aims to provide answers to these questions and others, including how the roles of directors in organizations around the world will continue to evolve.
In Sweden, none of the directors surveyed viewed the regulatory system for governance as ineffective. Almost 90 percent of the directors stated that the Swedish regulatory system strikes an appropriate balance between intervention and flexibility via a principles based approach or allows a good degree of flexibility via the ‘comply or explain’ approach. In summary, it seems that the Swedish respondents are rather satisfied with the regulatory system for governance.
“In light of all the recent news surrounding security incidents and data breaches, it is surprising that we are not seeing an increased number of boards discuss the security risks facing their company. Failure to take preventative measures to protect against breaches in security poses a huge risk to organizations. Such risks can adversely expose organizations to internal control deficiencies and reputational risks; that may ultimately result to in lost revenue.”
- Dan Konigsburg, DTTL Managing Director, Global Center for Corporate Governance
Highlights from the survey
Diversity in the boardroom - Almost two-thirds (63 percent) of global boardroom directors have not introduced diversity policies for board composition in their organizations, In addition, sixty-two percent of the directors surveyed stated that their boards have not implemented age or term limits, or that they were unsure of such limits. “The survey results reveal that while good progress is being made in improving diversity in the boardroom; there is still a long way to go before we see significant change in terms of the numbers,” said Konigsburg.
Interaction between shareholders and boards expected to increase - Nearly 70 percent of respondents expect the level of interaction between shareholders and boards to increase over the next few years. However, despite acknowledging the increasing levels of shareholder scrutiny, 61 percent of directors do not have a shareholder engagement policy in place.
Social media not utilized by majority of board directors - Nearly two-thirds of all directors surveyed stated that their board does not use social media. “I was surprised by this result. As the world moves to an increasingly digitized environment, board members should begin to leverage social media to identify potential business and reputational risks facing their organizations,” said Konigsburg.
Global financial crisis no longer a key concern – Based on the survey responses, boards are becoming more confident that markets are emerging from the global financial crisis.
Performance moves up the agenda– The survey found 20 percent more directors stating performance as an issue on their boardroom agendas. Performance is now the second-most discussed issue, behind strategy (18 percent increase), followed by growth (13 percent increase) and shareholder value/ investors (11 percent increase). “These results may indicate that boards are moving away from austerity policies and are focusing more on company performance/operations and the creation of long-term sustainable growth,” said Konigsburg.
Participating countries/ regions
- Czech Republic
- The Middle East
- The Philippines
- United States