Deloitte：Shaping the Future Board of Directors and Seizing New Opportunities for Development

Deloitte

Introduction

The report of the 20th CPC National Congress proposed that China should build a high-level socialist market economy, improve the modern enterprise system with Chinese characteristics, promote entrepreneurship and accelerate the construction of world-class enterprises, so as to promote high-quality economic and social development. Under the guidance of these new goals, it has become an important task for Chinese enterprises to find ways to shape the future board of directors through corporate governance and grasp new development opportunities. The chair of the board of directors of a Chinese enterprise should have a deep understanding of the international status quo of corporate governance, learn from the insights of the chairs of overseas boards of directors and understand the future role of a chairperson of a board of directors more deeply under the unprecedented changes throughout the last century in order to better their execution of this central role in corporate governance, pave the way forward and improve governance efficiency for the company.

Under the modern enterprise system, the board of directors is the center of corporate governance and the chair of the board of directors is the leader of this board. The chair of the board plays a key role in the corporate governance system and has a significant impact on the effective operation of the board of directors. In recent years, tremendous social change, including unpredictable events such as COVID-19 and geopolitical turmoil, as well as challenges such as digital transformation, climate change, regulatory pressure and investor engagement, are redefining the role of the chair of the board.

In order to understand the change of the governance role of the chair of the board and the expectations of stakeholders for the future chair of the board, Deloitte’s Global Boardroom Program conducted research on the theme "The Chair of the Future". The research posed a number of questions, including: what will the chair of the future look like? What skills, capabilities, and experiences will be required to be a successful chair? And how should chairs oversee management as their organizations face these manifold challenges? This research focused on 16 countries, namely: Australia, Belgium, Canada, China, Kenya, Uganda, Germany, India, Ireland, Italy, Japan, New Zealand, the Netherlands, South Africa, the United Kingdom and the United States. More than 300 chairs of boards from large listed companies and private enterprises (including some family enterprises) across the globe shared their understanding and insight on relevant topics.

The program's annual report Five Changing Forces of Defining the Role of the Chair of the Modern Board of Directors presented relevant results from the research. It defines five fundamental forces reshaping the future role of the chair of the board, specifically, organizational governance that asks the chair to play a greater role; a larger society that place higher expectations on enterprises, a changing climate that forces enterprises to take action, external crises that encourage boards to operate differently; and increased need for the board to operate with digital efficiency and agility. The research report points out that under the influence of these five forces, the governance role of the chair is expanding to meet expectations of stakeholders, and for the chair to play a more active role in the forefront of corporate governance.

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Deloitte：Shaping the Future Board of Directors and Seizing New Opportunities for Development