Digitalisation has had a significant impact on corporate governance. This impact has not only become evident in the content of boards' agendas, where digitalisation is frequently present and given increasing priority, as noted by numerous academic and professional studies and evidenced by the more than one hundred board members who recently took part in the study published by the Esade Centre for Corporate Governance. Digitalisation has also led to a shift in the way that boards are organised, it has changed the profile of new board members recruited, and with the arrival of the pandemic, it has transformed the way in which governing bodies are managed.
Covid-19 has made it necessary for companies to maintain the activities of their governing bodies without members meeting face to face. 90% of participants in the aforementioned study said that the level of digitalisation of their boards had increased with the arrival of the pandemic. The most advanced companies have stepped up the use of technology tools or platforms already at their disposal, which had often been underused; in other cases, these have been improved with new functionalities; and for a third group of companies, the pandemic provided a clear incentive to invest in the development or acquisition of a platform that would allow members to continue the board's operations without the need for face-to-face meetings.
Three of every four companies whose board members took part in our 2021 survey say that they already have some type of digital platform that supports the operations of their board
Furthermore, the study reveals that the main obstacle that prevents governing bodies from implementing these types of tools or platforms continues to be financial. Nevertheless, three of every four companies whose board members took part in our 2021 survey say that they already have some type of digital platform that supports the operations of their board.
One of the advantages of its use, besides swift access to information and the knowledge that sensitive corporate data is secure and under control, is that it facilitates the board's monitoring and supervision tasks. It also makes it easier for boards to meet more frequently (virtually), discussion is more ordered and agile, and decision-making processes become more efficient.
The combination of face to face and digital/online creates many synergies and boards of directors are not immune to this evolution in ways of working
However, there is a strong consensus that once the situation caused by the pandemic has returned to normal, and just as we are observing now in fact, face-to-face meetings will be resumed, without ever ruling out the possibility of continued remote/online interaction for some participants or even remote meetings for the entire board or committees. As in other business areas, the combination of face to face and digital/online creates many synergies and boards of directors are not immune to this evolution in ways of working.
It may be of interest to consider the conclusions to be drawn from this survey when we make a five-year projection of the impact of digitalisation on the everyday work of these boards. One in three members surveyed predicts that paper documentation will disappear; only in 20% of cases is there expected to be an expert in artificial intelligence or digital transformation on the board; and a similar percentage foresees that there will be more virtual meetings than face-to-face meetings. Perhaps the greatest scepticism is shown with respect to the use of artificial intelligence in the decision-making processes of boards, in addition to the use of virtual or augmented reality for the presentation or monitoring of investment projects.
Armed with this new expertise, not only will boards be better prepared to support and discuss their projects and proposals with executives, they will also be able to use their own judgement to supervise and monitor their work more effectively
The speed at which such developments may evolve will depend on the digital culture of our boards of directors and whether or not there is a change in their mentality. In some cases, our boards, supported by their CEOs, need to improve the awareness and training of their members with respect to going digital, while in others, they need to bring in new members with greater experience of the new disruptive technologies that are transforming sectors and companies. Armed with this new expertise, not only will boards be better prepared to support and discuss their projects and proposals with executives, they will also be able to use their own judgement to supervise and monitor their work more effectively, as befits the governing body of a company.
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