Directors are more focused on non-shareholder needs than the public and media believe. This is according to the just-released report from Diligent Institute and Stanford University’s Rock Center for Corporate Governance.
The report paints a nuanced picture of how board directors are managing shareholder and stakeholder interests and where improvements can be made.
Some key findings and topics include:
- Commitment to non-shareholder demands: 89 percent of corporate directors believe it’s important for their company to consider the interests of non-shareholder stakeholder interests, including employees and the public.
- A perception problem: 58 percent of board directors believe the media does not accurately understand what their company does to meet stakeholder needs. This highlights a communications shortcoming companies must overcome to meet stakeholder demands.
- Weighing differing needs: 46 percent of directors believe stakeholder interests are just as or more important than shareholder interests. Though challenges persist, currently 92 percent are satisfied with the job their company does to meet the interests of non-shareholders.
- Foreign companies are ahead of the curve: 79 percent of non-U.S. directors versus 67 percent of U.S. directors agree with BlackRock CEO Larry Fink that companies face pressure to “maximize short-term returns at the expense of long-term growth.” This displays differences in how varying business and regulatory climates impact board outlook.
Download the full report below to read more.