With boards now addressing a growing array of topics—ranging from AI to climate change to supply chain resilience—more companies are enlisting outside expertise and educational resources to improve board fluency in key areas.
According to a new report by The Conference Board with data from ESGAUGE, the share of US companies relying on a combination of internal and external education programs grew from 25% in 2018 to 37% in 2023 among S&P 500 companies. And in the Russell 3000, the share grew from 12% to 23%.
“Third-party experts can help educate the board in key areas relating to the digital and sustainability transformations of the business,” said Merel Spierings, Senior Researcher at The Conference Board and author of the report. “In doing so, it is critical to partner with management to tailor the information they present to fit the company’s specific needs and circumstances.”
As detailed in the report, boards are also conducting more comprehensive self-evaluations. While stock exchange listing standards require only that companies conduct board- and committee-level evaluations, as of November 2023, a majority of S&P 500 companies (56%) disclosed that they are now conducting a combination of full board, committee, and individual director evaluations, up from 37% in 2018. Similarly, the share of Russell 3000 companies adopting this approach grew by 20 percentage points, from 18% to 38%.
The report was produced with Debevoise & Plimpton; KPMG; Russell Reynolds Associates; and the John L. Weinberg Center for Corporate Governance. Additional findings and insights include:
While most US public companies rely exclusively on in-house board education programs for directors, more companies are complementing internal programs with external resources.
- S&P 500: The share of companies drawing upon both internal and external resources grew from 25% in 2018 to 37% in 2023.
- The share of exclusively in-house programs declined from 67% to 61%.
- Russell…
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