London, 14 July 2014 – The perception of cyber security as a major business risk has increased, with more companies taking active steps to mitigate it, but social media policy and strategy is not yet seen as important. These are just two of the findings of the fifth FT-ICSA Boardroom Bellwether survey, the bi-annual survey produced by ICSA (Institute of Chartered Secretaries and Administrators) and the FT (Financial Times).
The survey, which canvasses the views of FTSE 350 company secretaries to determine UK boardroom sentiment on a range of business issues, found that 86% of respondents consider cyber risk as a major business risk, up from 76% in December 2013. Companies have also been more active in mitigating the risk, with the number that have rising to 44% from 31%, with a further 25% having identified that external assistance is needed. Furthermore, 63% of respondents report that their board has actively discussed the Government’s ‘Ten Steps’ guidance (up from 21% a year ago), with two-thirds of those having acted upon it.
It is surprising, therefore, that 47% of respondents admit that their board has never discussed a social media policy and a mere 7% have discussed social media policy more than three times in the past twelve months. Only 26% describe a social media strategy as important to the board. “Given the reputational risk that can be associated with social media, it is astonishing that boards are not taking the issue more seriously,” says Peter Swabey, Policy & Research Director at ICSA.
Other key findings are as follows:
81% of respondents anticipate an improvement in global economic conditions over the coming twelve months, a significant increase from 69% in December 2013, and a huge leap from March 2012 when it was just 36%.
Businesses are bullish about the UK economy with 84% anticipating improvement in the next twelve months (up from 80% in December) and no-one predicting a decline. In March 2012, only 28% predicted an improvement and 40% thought things would get worse.
54% of respondents view the Government as business-friendly compared to 33% in December 2013; the Opposition, on the other hand, is viewed by just 4% as business-friendly.
EU membership brings business benefits, whilst Scottish independence is unlikely to significantly affect business.
Despite the pro-business stance of the Government, the survey points to some dissatisfaction with legal and regulatory requirements. “UK boardrooms have expressed an interest in decreasing regulation and reporting requirements,” comments Peter Swabey. “It is clear that there is some desire for certainty rather than constant fluctuation. In particular, 52% of respondents found the new remuneration reporting requirements difficult to comply with.”
The survey also reveals that gender diversity is on the increase with 67% of those surveyed believing their boards to be diverse or very diverse in terms of gender, up from 51% in December 2013, and a marked improvement from 19% in May 2012. 53% are confident that Lord Davies’ target of 25% of females on boards by 2015 will be met, with a further 25% saying that it will very nearly be met. Only 16% of respondents, however, believe that their company’s executive pipeline will be sufficient to support a sustainable pool of talented board-ready women in the future.
Alison Smith, Chief Corporate Correspondent at the Financial Times comments: “At first sight the gap between the high proportion of companies that expect to meet the Davies 25 per cent target proportion of women directors by 2015 and the low proportion that believe that their female executive pipeline is sufficient suggests a degree of misplaced optimism. A more encouraging interpretation is that boards are increasingly ready to look beyond women already in plc executive roles when it comes to selecting female directors, and this should add to the diversity of views around the boardroom table.”
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1 The FT-ICSA Boardroom Bellwether is a twice-yearly survey which seeks to gauge the sentiment inside UK boardrooms. The findings show how boards are positioning themselves to address the challenges of the economy, and the wider business and social climate in which they operate. Current and past Boardroom Bellwethers can be viewed here: www.icsa.org.uk/bellwether
2 ICSA (Institute of Chartered Secretaries and Administrators) is the chartered membership and qualifying body for professionals working in governance, risk and compliance, including company secretaries. Our members work in all sectors and at every level of seniority. With over 120 years of experience, we champion high governance standards by providing qualifications, training, high-quality guidance and support (including technical resources, publications and software), and through our work with regulators and policy makers. Website: www.icsa.org.uk
3 About the Financial Times: The Financial Times, one of the world’s leading business news organisations, is recognised internationally for its authority, integrity and accuracy. Providing essential news, comment, data and analysis for the global business community, the FT has a combined paid print and digital circulation of 665,000 (Deloitte assured, Q1, 2014). Mobile is an increasingly important channel for the FT, driving 60 per cent of subscriber consumption, 45 per cent of total traffic and 20 per cent of new digital subscriptions. FT education products now serve 37 of the world’s top 50 business schools. Website: www.FT.com