From the diversity of the board to oversight of new ESG risks, directors are coming under increasing pressure to rethink governance and decision making processes. Are Caribbean organisations living up to stakeholder expectations? PwC in the Caribbean’s Corporate Governance Survey 2022: Picking up the pace gauged the views of 193 directors from private and public sector organisations across the region to find out.
More than 60% report that ESG is at least somewhat linked to their company’s strategy and acknowledge its financial impact. Yet less than a third of directors report that ESG issues are a regular part of the board’s agenda and only around 10% believe that their board understands ESG risks very well.
would replace two or more fellow directors
Around half of the directors believe that at least one fellow board member should be replaced. Of these, nearly 30% would replace two or more fellow directors.
When asked about areas that need more time and attention in the boardroom, succession planning (41%) came out on top. ESG isn’t far behind (38%), but may need more oversight and challenge given its impact on strategy, governance and risk.
plan to take action to address diversity issues
Despite the need for broader perspective and representation, less than 1% of directors feel their boards are already diversified and 40% haven’t taken any action to strengthen diversity over the past two years. However, nearly 60% have or plan to take action to address diversity issues through investing in upskilling or retraining.
Nearly half of the directors believe that virtual meetings positively impact meeting efficiency. At the other end of the spectrum, over 30% feel there has been a negative impact on director engagement and the ability to voice dissent.
support incentive plans
More than 70% of the directors support incentive plans as a way to enhance long-term shareholder value. However, more than half think that executives are already overpaid. Over 40% believe that compensation committees are too willing to approve overly generous packages/incentives and more than 30% feel that performance targets are too easy to achieve.
ESG Leader, PwC East Caribbean, PwC Barbados
ESG Leader, PwC Bahamas
Carolyn Bell Wisdom
ESG Leader, PwC Jamaica
ESG Leader, PwC Trinidad and Tobago