Two keys elements of good governance and a strong corporate culture are the visibility of the leadership team and a strong employee understanding of what that company stands for and is aiming to achieve. However, a new research with 1,000 UK employees, conducted by TLF Research for technology firm eShare, saw 18% of respondents say their board is barely visible, with a further 17% saying the board is not visible at all.
31% of of those surveyed said that they do not understand what their company’s vision and values are. Around half of them were in the dark about board decisions, feeling those decisions were not clearly communicated to the rest of the company.
A lack of board diversity was a common theme amongst respondents too. 37% said there is not a woman on the board at their organisation, 58% said there is no-one under the age of 40, and 55% said there is no ethnic diversity.
Alister Esam, CEO, eShare, points out that a majority of boards are comprised of a very similar demographic. So “it is not surprising that many workers feel their board could be more diverse.” He believes that the addition of an employee to the board would certainly add a different perspective and is on the face of it a positive move. However, “it is actually fraught with issues, from the possibility of immediate disclosure of company plans to employees, to the selection process of the employee representative, and there are more effective ways of improving senior level diversity.”
More than half of respondents felt their board was out of touch with day-to-day operations at their company. In terms of specific roles within a board, the Chief Executive Officer (CEO) was most visible to employees, although only 36% could name the CEO at their company. The least visible was the chairperson, with only 8% able to identify that role in their organisation, with 14% able to identify the Chief Information Officer (CIO) and Chief Financial Officer (CFO), and 13% able to identify the Chief Marketing Officer (CMO).
“The pressure on boards to do business in a transparent fashion is greater than ever,” concludes Esam. He believes that most businesses are better governed than they ever have been, but need to demonstrate this more effectively. “Good governance in 2017 means knowing what you are and why you exist, being well-run from top to bottom and having internal values and behaviours that are perpetuated externally across the world.”