A survey of 83 general advisors (GCs) conducted by Gartner in February 2021 revealed that their key corporate governance and board leadership objectives relate to environmental, social and governmental (ESG) issues, the second most common choice was board training followed by board training.
“GC is often the voice of various corporate stakeholders on the board. ESG topped their list because different stakeholders had increased expectations. and ESG has indeed become a process to take into account the expectations of different stakeholders, “said Drew Tanenbaum, Gartner’s Director of Legal and Compliance Practices.
Gartner predicts that transformation will affect organizations. the next wave will be socially focused, which means that in the future, companies will need to should focus on society. This is driven by a number of overarching geopolitical themes and stakeholder expectations around issues such as diversity, equity and inclusion, and sustainability.
“Most organizations make some attempt to assess the strategic impact of the ESG. But far fewer take it to the next level by setting clear ESG-related operational goals or otherwise embedding ESG in corporate decision-making, ”said Tanenbaum.
While GCs they are generally successful in providing new information to the board, they themselves declare less effective in encouraging action. However, as organizational transformation becomes more socially focused, the board should take steps to ensure that directors have the skills, knowledge, experience, and processes to oversee this change. The GC is often the most appropriate leader to provide assistance.
Board education and director training were the second and third most common priorities for the GC, respectively. This reflects the fact that GCs feel that their board lacks the skills they would be best placed to navigate in their organization’s current environment. “It’s an intuitive solution to the problem: we need more or different skills, we train ourselves. But in reality, the GC and the board in general should see skills gaps as a major lifecycle problem rather than just a lack of training,” Tanenbaum explained.
In their current form, board evaluations often do not assess the abilities of individual board members, making it difficult to identify exactly where the greatest shortcomings are. This is difficult to remedy with training, as more than half of the organizations do not require annual director training.
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