To better understand how directors are thinking about the mix of skills, backgrounds, experience and perspectives in the boardroom – and tools and approaches to achieve the right mix – KPMG surveyed more than 2,300 directors and senior executives across 46 countries. While the views and practices related to board composition vary by country (as detailed in the survey report), key global trends include:
- Board composition – and alignment with strategy – is a key priority. Survey respondents identified several reasons for the intense focus on board composition, including the need for directors with an understanding of the competitive environment, greater diversity of viewpoints and backgrounds, and understanding the pace of technology change and the potential disruptors of the company’s business model.
- Significant barriers exist to building a high-performing board. The barrier most frequently cited by survey respondents was ‘finding directors with both general business experience and specific expertise needed by the company’ (Global: 69%; China/Hong Kong: 63%). ‘Identifying the board’s future talent needs’ ranked second (Global: 55%; China/Hong Kong: 46%), followed by resistance to change due to ‘status quo’ thinking (Global: 43%; China: 55%).
- Despite wide recognition of the importance of succession planning in achieving optimal board composition, many boards lack a formal succession plan. While the vast majority of survey respondents said that a formal board succession plan is a key mechanism to achieving the right board composition, only 14% (Global; China/Hong Kong: 15%) reported having either a ‘formal succession plan in place that aligned with the company’s future needs’, or ‘robust discussions and succession planning in process’ (Global: 17%; China/Hong Kong: 11%).
KPMG ACI Global Pulse Survey