Dubai, United Arab Emirates, November 15, 2023: The GCC Board Directors Institute (GCC BDI), the leading governance advisory and advocacy organisation, has published its 8th Board Effectiveness Review, revealing the trends and insights engaging board members in the GCC. The new report, produced in collaboration with Heidrick & Struggles, finds that managing stakeholder expectation was a growing concern for respondents while the long term value of good sustainability and environmental, social and governance strategy for companies was broadly recognised.
The review, which has taken place every two years for 16 years, polled 155 GCC BDI members and directors from Bahrain, Kuwait, Oman, Saudi Arabia and UAE and asked them 108 questions on board effectiveness and challenges.
The survey found that boards in the GCC are going through an intense period of transformation after emerging from the pandemic. Directors are adapting to global best practice and meeting new government and regulatory requirements and raising their standards for a new age of professionalism to ensure they are ready to steer their companies through complexity, disruption, and opportunities ahead.
Managing stakeholder expectations appeared to be a major concern with 45 per cent of respondents believing it will have a significant impact on companies over the next three years, a rise of 17 percentage points from the 2021 report.
The report revealed a growing acceptance of the opportunities offered by strong sustainability and ESG strategy, with 89 per cent of respondents believing that working towards sustainability will help boards create long-term value for their company.
Staying abreast of regulatory change was a concern for directors, although 44 per cent felt there was the right balance of regulation and autonomy. Only 18 per cent felt they were subject to too much regulation.
John Gollifer, new Chief Executive Officer of GCC BDI, said: “The review highlights the importance of research to share insights among the business community to help drive forward and embed best practice. It has found that the disruption and challenges of the last few years have forced organisations of all sizes and industries to make rapid change. The Covid-19 crisis has accelerated operational changes and, in some ways, has created a stronger collaboration between directors and management. Such robust collaboration is key to a board’s success and should be maintained.
“Based on the review, the GCC BDI recommends that boards should ensure their members represent different ages, nationalities, skills and experience and ensure they have a professional board secretary. They should take a long term perspective on strategy and embed ESG in their organisation through tracking and reporting. Finally, they should ensure they evaluate and assess board performance every three years.”
The review was produced with Heidrick & Struggles, the premier provider of leadership consulting, culture shaping and senior-level executive search services which is also a founding organisation of the GCC BDI. Richard Guest, Partner-in-Charge of Heidrick & Struggles Middle East & North Africa said that the need for the research and advice offered in the 8th Board Effectiveness Report was greater than ever as the governments of the GCC encourage investment and company creation in pursuit of their long term development decisions. “Boards set the tone for the entire organization. With heightened focus on sustainability from employees, investors, regulators and the public, it is more critical than ever for these leaders to engage and prioritize the issue. We hope this research helps boards benchmark where they are in the industry, and if needed, rethink their board competencies and bench strength to set themselves up for success,” he said.
“It seems clear that the demands and expectations of boards are increasing,” said Markus Wiesner, Regional Managing Partner, Heidrick Consulting for Asia Pacific, Middle East, and Emerging Markets, at Heidrick & Struggles. “Boards in the Gulf can look to how boards in other regions are responding to these pressures and adapt these approaches to their local context.
“Among the actions boards can take to improve their overall effectiveness are: taking a long-term perspective on how sustainability and other issues will impact their business, sharpening strategic oversight by examining and re-balancing the overall makeup of the board; and improving governance to drive performance, increase stakeholder trust, and meet changing regulatory requirements.”
Link to the GCC BDI Board Effectiveness Review: https://gccbdi.org/gcc-bdi-board-effectiveness-review-2023
About GCC Board of Directors Institute
GCC Board Directors Institute (GCC BDI) is a not-for-profit organisation that guides board directors of organisations, from family-owned businesses to listed companies, to acquire the know-how and the tools to reach and sustain effective governance. Launched in 2007, we are supported by eight leading regional corporations and professional services firms that serve as our strategic partners.
Our mission is to enhance board member capabilities, create a strong and influential regional network of board members, and disseminate high-quality corporate governance knowledge, leading the regional debate on emerging best governance practices. We aim to accomplish these goals through a combination of effective practice and experience sharing, access to global knowledge, and interaction with regional and international counterparts.
GCC BDI has grown to become the leading organization in the region for board directors. We have delivered over 600 programs and forums to top-tier companies in the Gulf and now comprise over 3500 members, each with extensive knowledge and experience in operating at the most senior levels of business in the GCC.
For more information, please visit https://gccbdi.org
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About Heidrick & Struggles
Heidrick & Struggles is a premier provider of global board, leadership and organisational advisory insights, serving the senior-level talent and consulting needs of the world's top organisations.
In our role as trusted advisors, we partner with our clients to develop future-ready boards, leaders and organisations, bringing together our services and offerings in executive search, board advisory, diversity and inclusion, leadership assessment and development, organisation and team acceleration and culture shaping.
Heidrick & Struggles pioneered the profession of executive search more than 70 years ago. Today, the firm provides integrated board, organisation, talentand human capital solutions to help our clients change the world, one leadership team at a time.
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