08 November 2017

Board Agenda: Boards struggle with culture

New research from Board Agenda, conducted in association with Mazars and INSEAD, reveals that while some boards recognise the value of corporate culture, a significant number are still grappling to give it adequate time and attention.

Almost two-thirds of European company directors work on boards that either fall short of giving corporate culture significant attention, or fail to include it in their formal risk-management systems, according to new research.

Board Leadership in Corporate Culture: European Report 2017, conducted by Board Agenda in association with professional services firm Mazars, and business school INSEAD, gathered the views of 435 board members across Europe.

The survey found that 63% either work on boards that exclude culture from formal risk considerations, or fail to routinely assess the risks associated with their own corporate cultures.

The news will come as a disappointment to many, following efforts by politicians and regulators to highlight the importance of maintaining and monitoring a sound corporate culture. In the UK, regulators have stressed that boards have a responsibility for defining a company’s purpose and ensuring its values are in tune.

The FRC is expected to emphasise the importance of culture when it publishes a review of the UK Corporate Governance Code in November this year.

David Herbinet, global head of audit at Mazars, said: “Many years after the famous Peter Drucker quote about culture, strategy and breakfast, culture has finally, and rightly, taken centre-stage on the governance agenda.

“Much work, however, remains to be done by boards to fully grasp it and use it effectively in decision-making, and for investors to properly assess it, for the long-term benefit of companies, their stakeholders and wider society.”

The survey suggests that while some directors give culture ample time, it is has failed to grasp the attention of a significant number of boards.

Full article

European report

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