In December 2019, the GCC Board Directors Institute published a review of board effectiveness in the Gulf. The survey comprised 75 multiple answer questions, which were disseminated to all GCC BDI members and board directors to seek their views on board effectiveness and challenges. Responses from 105 members were collected, reflecting a diversity of board member and executive views based on their role, company type, industry and country. In addition, open-ended and confidential interviews were conducted with 13 senior GCC board members, executives and other experts, to discuss the survey results and to probe into specific issues highlighted as being of concern to board members.
The report highlights the progress that has been made since the BDI’s last survey in 2017. The report shows that many directors are still struggling with the implementation of new regulations and codes of corporate governance and need more time to embed new practices in the board room. The report also shows differing levels of board and corporate governance maturity across the GCC, with banks and listed companies being the early adopters, driven by greater regulation. While family businesses generally lag behind, leading family and private businesses are engaging with good governance and finding the right balance for their business.
The survey identifies numerous challenges facing Boards in the region– globalisation, artificial intelligence, digitalization and digital disruption, the growing focus on environmental issues and climate change, the pace of regulatory change, changing macro-economic dynamics with potential trade wars, as well as geo-political uncertainty.
The report also highlights the changing perceptions of corporate governance in the GCC, the need for directors to spend more time on their board duties, the lack of women on boards in the region and the need for quotas to address this issue, the growing importance of the role of the Board Secretary, and new and emerging trends such as integrated reporting, and ESG (Environment, Social and Governance) reporting and auditing, which GCC boards will need to deal with in future.
The report can be downloaded at the GCC BDI website.