Ensuring that directors are fully engaged during board meetings is crucial for effective governance. BoardOutlook’s board evaluations provide insights into how directors’ attention levels have changed over recent years, particularly in response to significant shifts in the operating environment.
BoardOutlook’s evaluations showed a substantial increase in directors' engagement during board meetings between 2020 and 2021. Specifically, there was a 27 percentage point increase in respondents identifying ‘directors give their full energy and attention’ as a strength. This period coincided with significant changes in board operations and the shift to virtual meetings due to the COVID-19 pandemic.
However, this upward trend has not continued. By 2023, only 62% of respondents felt that directors were fully engaged, down from 70% in 2022. Moreover, the number of respondents who saw director attention as an area needing improvement nearly doubled, increasing from 7% in 2022 to 10% in 2023.
The rise and subsequent decline in directors' engagement is potentially linked to broader contextual factors. The initial increase from 2020 to 2021 likely reflects a rebound as directors found a new way of working in a virtual environment brought on by the pandemic. BoardOutlook Client Partner Louise Pocock observed: “During COVID, I was working on a project for the AICD, interviewing Chairs of ASX50 companies. They were all quickly adapting to the changing circumstances. It was impressive.” This swift adjustment and newfound operating rhythm likely boosted engagement levels as directors navigated the new normal.
The slight decline from 2022 to 2023 may similarly be explained through the increasing complexity of the global economic environment. As economic challenges have grown, directors may be focusing their attention on the most pressing issues and boards, which may lead to a perceived decrease in overall engagement during board meetings. This trend will be further evaluated with data from 2024.
This data highlights the dynamic nature of director engagement in board meetings. The initial increase in engagement during the pandemic years showcases the adaptability of boards as they rebounded and found new ways of working in a virtual environment. The recent decline underscores the need for ongoing attention to maintain high levels of engagement amid evolving challenges. The upcoming data from 2024 will provide further insights into these trends and their implications for board governance.
This data was compiled from board evaluations completed within the BoardOutlook platform between 2020 and 2023. It collates responses from board members and management teams across APAC, the UK and the US
