PWC’s annual directors survey shows a “new trust crisis,” a widening disparity between corporate insiders’ opinions on how they are perceived by consumers and the reality.
While 87% of business executives believe consumers highly trust their company, only 30% of consumers actually do. Trust is hard won and easily lost, and stakeholders are coming to expect more from companies. This lands at the feet of the board of directors as the stewards of the company.
Some of the most significant findings:
Directors continue to be terrible at replacing under-performing colleagues. “48% of directors would replace at least one member of their board. Nineteen percent (19%) would replace two or more.”
Women directors are more concerned about climate change than male directors. “Two-thirds of female directors say reducing the impact of climate change is a priority even if it impacts short-term performance—compared to less than half of male directors.”
Board members place environmental concerns low on the list of priorities.”Only 11% of directors say it is very important for their board” and only “45% of directors believe that ESG issues actually have an impact on company performance.” Board of companies with under $1 billion in revenue have even less interest. Only 27% have discussed climate change and “only 11% of directors believe environmental/sustainability expertise is very important for their board—ranking last on our list of skills and areas of expertise.”
Shareholder engagement with board members is increasingly significant and overwhelmingly considered positive. “60% of directors say a member of their board other than their CEO met with shareholders during the year. Nearly 90% say it was productive.”
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Certainly reinforces stereotype of corporate directors as living in their own bubble world, unconnected to “regular people.”