London, 29 August 2023 – A survey of FTSE 350 companies published today finds that the UK’s largest companies are tentatively more optimistic about the global and UK economy – and that every single one of them has taken action to support employees through the cost-of-living crisis.
The Boardroom Bellwether, published annually by the Financial Times and The Chartered Governance Institute UK & Ireland (CGIUKI), surveys Company Secretaries across the FTSE 350. This year, the Bellwether’s results indicate a promising recovery in economic confidence. The UK’s largest companies are becoming quietly more optimistic, with almost half (48%) expecting the global economy to improve over the next year, and one third (33%) expecting the UK economy to improve. In contrast, 29% expect a decline globally, and 41% in the UK. This is a marked improvement on last year, when 76% were expecting a decline in both the global and UK economies.
Amongst the FTSE 350 are some of the UK’s biggest employers and, encouragingly, 100% of respondents reported having taken action to support their employees during the cost-of-living crisis. Unsurprisingly, the cost-of-living crisis has also been a factor in decisions about executive remuneration, with 92% of boards reporting that they have considered it alongside wider workforce pay.
The Bellwether aims to lift the lid on FTSE 350 boards, and this year it unveils that 81% feel that increasing reporting requirements are having an impact on the time available to discuss strategy. More positively, there has been huge progress made in board diversity over the eleven years of the Bellwether, and this year 94% of boards are considered to be gender diverse and 77% to be ethnically diverse.
The top three risk factors cited by FTSE 350 respondents were cyber risk, global economic risk and climate risk. With regard to climate change, more companies are beginning to turn words into action, moving beyond ambiguous net zero pledges to more detailed transition plans; 80% of respondents have tangible plans, either in development (39%) or complete (43%). However, 81% find it somewhat or very difficult to meet ESG disclosure requirements.
In such demanding times, the performance of the board has never been more important, which is why CGIUKI has also published a suite of guidance on board performance reviews. These are designed to support companies in procuring, managing and reporting on reviews, and to set out best practice for board reviewers, in order to achieve the best possible outcomes for boards and the companies they steer.
Peter Swabey, Policy and Research Director at CGIUKI, commented:
“The annual Boardroom Bellwether is a temperature check of the UK’s biggest businesses, and this year’s results paint a tentatively optimistic picture of companies’ abilities to handle the myriad challenges they are currently facing. We are encouraged by companies’ efforts to support their employees during the cost-of-living crisis, by the progress on board diversity, and by increasing commitments to climate action. As more challenges emerge over the coming year, boards and governance professionals will need to ensure they are well-equipped to continue to steer their companies successfully.”
For further information, please contact Peter Swabey, Policy & Research Director at pswabey@cgi.org.uk or on 07850 584552.
Notes to Editors:
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The Chartered Governance Institute UK & Ireland is the professional body for governance and the qualifying and membership body for governance professionals across all sectors. Its purpose under Royal Charter is to lead ‘effective governance and efficient administration of commerce, industry and public affairs’ working with regulators and policy makers to champion high standards of governance and providing qualifications, training and guidance. As a lifelong learning partner, the Institute helps governance professionals to achieve their professional goals, providing recognition, community and the voice of its membership.
One of nine divisions of the global Chartered Governance Institute, which was established 130 years ago, The Chartered Governance Institute UK & Ireland represents members working and studying in the UK and Ireland and in many other countries and regions including the Caribbean, parts of Africa and the Middle East.
Website: www.cgi.org.uk
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This year’s Boardroom Bellwether can be found here: https://www.cgi.org.uk/knowledge/research/bellwether-2023
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The Chartered Governance Institute UK & Ireland’s suite of guidance on board performance reviews can be found here: https://www.cgi.org.uk/services/board-performance-review
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The word ‘Institute’ is one of the ‘sensitive words or expressions’ restricted under the Companies Act 2006. s1194(1) of the Act provides that “A person must not, without the approval of the Secretary of State, carry on business in the United Kingdom under a name that includes a word or expression for the time being specified in regulations made by the Secretary of State under this section.” As a Royal Charter body, The Chartered Governance Institute UK & Ireland is legally entitled to use this term and has no connection with other training providers with similar names, calling themselves an ‘Institute’ without the necessary approval to do so.