TheCorporateCounsel.net

The work of the board of directors seems to be always expanding, which makes it all the more important to implement an effective committee structure. Over on the Mentor Blog on TheCorporateCounsel.net, Emily recently highlighted findings that were published by The Society for Corporate Governance and Deloitte on the structure of board committees, based on a survey of nearly 180 public companies. Here are some highlights from the report:

– Forming new committees: Just 13% of respondents added or are considering adding at least one new standing committee. Among those that added a new committee, a technology committee was most common; others included cybersecurity, sustainability, and ESG-related committees.

– Expanding board oversight responsibilities: 55% of respondents reported their board expanded oversight responsibilities of one or more of its standing board committees. Many respondents indicated that their boards expanded committee oversight responsibilities to include ESG, either by delegating individual topics to specific committees or by delegating ESG as a whole to the nominating and governance committee.

– Onboarding program: 45% reported having an onboarding program for new committee members; however, the prevalence correlates positively with market cap size. Many respondent comments indicated that committee onboarding typically occurs as part of new director onboarding.

– Rotation of members: While mandatory rotation remains rare, 39% of large-caps and 27% of mid-caps indicated their boards have non-mandatory policies or practices to rotate committee chairs; for other committee members, such policy was reported by 36% of large-caps and 24% of mid-caps.

– Dave Lynn