As the pandemic accelerates digitalization around the world, to what extent have corporate boards embraced new, digital-first tools and mindsets?
The pandemic has pushed organizations in every industry to embrace new, digital solutions. But while much has been written about the impact of the shift to remote work on employees, managers, and executives, there’s another critical group that’s been forced to transform itself overnight: board members. To what extent has the rapid digitalization associated with the pandemic extended to board operations? And to what extent will those changes persist as we move towards whatever the next new normal will be?
To explore these questions, we worked with our colleagues at professional services firm Tricor Group and the Financial Times Board Director Programme to conduct a broad survey of almost 800 global board directors. This survey identified both common trends in how boards have approached the challenges of the last year and illuminating differences between different countries and regions around the world.
For instance, we found that in general, board members for Asian companies reported more confidence in their organizations’ responses to the pandemic than North American and European directors did — likely due to the Asia Pacific region’s greater recent experience with similar public health emergencies. As Tencent board director Ian Stone explains, “An advantage we had in China was that we took the pandemic seriously. We had seen SARS and other similar crises before and were more ready to act quickly. This was facilitated by strong corporate governance enabling fast risk assessment and communication between the management and the board.”
But a closer look at the data reveals significant differences between individual countries: While just 50% of U.S. directors and 49% of UK directors reported feeling confident about how their boards had responded to the pandemic, there was major variance between different Asian countries: 71% of Singaporean and Japanese directors reported high confidence in their responses, compared to 68% in China, 61% in Thailand and Vietnam, and 56% in Australia and Malaysia.
In addition, while 80% of global directors said they believed digital transformation should be led at the board level rather than relegated to the IT department, boards in different regions differed dramatically in terms of follow-through. More than 90% of directors in Vietnam reported that their boards were actively exploring new digital tools, compared to 76-79% of directors in Thailand, Japan, and Malaysia; 67-70% of those in China and Singapore; and just 64% of those in the U.S.
These statistics serve as a useful reminder that trends are just that, and that no group should be regarded as monolithic in its approach to digitalization. Nevertheless, as boards begin to look towards a post-pandemic world, it can be helpful to consider the patterns that emerged from both the quantitative data and qualitative responses in our research. Specifically, we identified three key ways in which boards have struggled to adapt to a digital-first world. READ MORE
by Diana Wu David and Sunshine Farzan
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