This month I had the pleasure of speaking with TK Kerstetter, editor-at-large for Corporate Board Member and former chairman at the NYSE, to dive into the details of the latest What Directors Think study. Grant Thornton and Corporate Board Member teamed up to survey hundreds of U.S.-based directors at publicly traded companies on overarching issues such as risk oversight, board composition, shareholder engagement and financial considerations. The findings show a recent shift in business strategy and where corporate boards want to devote more time and effort.
Top Issues
When asked what they wanted more time to focus on, historically, directors’ highest rated answer was long-term strategic planning. This year, 23 percent of respondents want boards to spend more time on disruptive technologies and innovations, followed by growth strategy, cyber risk, CEO succession and merger & acquisition opportunities; long-term strategic planning is no longer in the top five. Given the rapid scale of A.I. solutions, companies are integrating technologies and forming partnerships to become industry leaders, diversify their business strategies and create more customer-centric organizations.
Technology Innovation and Cyber Risks
We’re seeing boards become more concerned about cyber-resilience – the ability to continuously function as expected despite a cyber threat or infiltration. While technology drives innovation, it also correlates strongly to security threats. We have these conversations on a daily basis with companies across a wide range of industries:
- What steps are you taking to be resilient? Do you need additional funding, a change in culture, company-wide education efforts?
- How are you seeing A.I. contribute to becoming more cyber resilient? It’s not uncommon to work with board members who only know A.I. as a buzzword but don’t understand specific solutions. Boards need to identify gaps in their business strategy, then decide what A.I. solutions can (and equally as important, cannot) do for their organization.
- Who has oversight responsibility? Is there a specific risk committee? Maybe it’s the audit committee that has the responsibility, or perhaps the full board? Regardless of who it is, it needs to be clearly communicated who has oversight and what the responsibilities are.
There is an unfortunate yet obvious problem most mid-market companies face: boardrooms don’t have a deep bench of cybersecurity experts. If cyber isn’t a priority, it needs to be. On the next board agenda, invite experts who aren’t typically in the room. This could be tapping into experts inside your company, or looking at outside sources like a trusted advisor. The truth is, there is no way to be resilient without being up to speed on the threats and opportunities at play.
A copy of the What Directors Think study can be viewed at boardmember.com/whatdirectorsthink. What are the initiatives you want to see your board spend more time on this year? As always, it would be my pleasure to collaborate to keep your business’ leaders apprised of trends and future-focused.
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