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Boards & Governance

Board Monitor Europe 2018

12/19/2018 Heidrick & Struggles
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In 2017, leading companies in the top three European countries by GDP—France, Germany, and the United Kingdom—filled 301 vacant board seats. These new directors and their boards face a challenging agenda of geopolitical and business issues that could significantly affect company strategy and operations.

Geopolitical issues include what a post-Brexit Europe will look like, nationalist legislation in individual EU countries, US tariffs on European goods, and the rising threat of protectionism around the world. Meanwhile, in virtually every industry, ongoing digitization and the race to employ artificial intelligence will pose significant challenges of disruption. The relentless war for top talent will likely increase boards’ involvement in succession beyond the CEO level. Greater regulatory scrutiny domestically and from the European Union will demand increased compliance, exemplary corporate governance, and a commitment to corporate social responsibility as well as to the creation of long-term value.

Board Monitor Europe 2018 is the second in our annual series of reports designed to provide profiles of new independent directors and track changes in those profiles from year to year.1

Our analysis surfaced the following key findings:

  • Of the 301 new independent seats on the boards of FTSE 250, CAC 40, and DAX 30 companies in 2017, 58% went to current and former CEOs and CFOs, down from 70% the previous year.
  • Some 200, or 66%, of those seats were filled by directors with previous board experience, down from 76% in 2016.
  • Of those 301 seats, 110, or 37%, went to women, down from 44% in 2016.
  • Only 1 of the 301 seats were filled by appointees with experience in cyberrisk, and only 10 by appointees with digital or social media experience.
  • Some 105, or 35%, of new seats went to non-national appointees, down from 48% in 2016.
  • Overall, the largest share of total substantial industry experiences lay in the financial services sector, at 34%, up from 26% in 2016.
  • The percentage of non-national appointees varied widely by country—from a high of 50% in Germany to 40% in France and 32% in the United Kingdom.
  • In the United Kingdom, the largest share of new appointees (36%) went to financial services boards. In France, the largest share (51%) went to industrial boards, and in Germany, the largest share went to industrial boards (36%) and financial services boards (36%).

To read the full report, flip through the interactive version above or click the download button for the PDF.


References

1 By “independent” we mean those directors who primarily represent shareholders, whether they serve on supervisory boards in a two-tier board structure or on a unitary board, and excludes company executives and employee and government representatives.


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