Boards can expect their oversight and corporate governance processes to be tested by an array of challenges in the year ahead—including global economic volatility, the war in Ukraine, supply chain disruptions, cybersecurity risks, regulatory and enforcement risks, and social risks, such as pay equity and the tight talent market.
The business and risk environment has changed dramatically over the past year, with greater geopolitical instability, surging inflation, and the prospect of a global recession added to the mix of macroeconomic risks companies face in 2023. The increasing complexity and fusion of risks unfolding simultaneously, and the increased interconnectedness of these risks up the ante for boards to have holistic risk management and oversight processes.
In this volatile operating environment, demands from employees, regulators, investors, and other stakeholders for greater transparency and disclosure—particularly around cybersecurity, climate, and other environmental, social, and governance (ESG) risks—will continue to intensify.
Drawing on insights from our latest surveys and interactions with directors and business leaders, we highlight nine issues to keep in mind as boards consider and carry out their 2023 agendas:
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- Maintain focus on how management is addressing geopolitical and economic risks and uncertainty.
- Monitor management’s projects to build and maintain supply chain resilience.
- Reassess the board’s committee structure and risk oversight responsibilities.
- Keep ESG, including climate risk and DEI, embedded in risk and strategy discussions and monitor U.S. and global regulatory developments.
- Clarify when the CEO should speak out on social issues.
- Approach cybersecurity, data privacy, and artificial intelligence (AI) holistically as data governance.
- Make talent, human capital management (HCM), and CEO succession a priority.
- Engage proactively with shareholders, activists, and other stakeholders.
- Think strategically about talent, expertise, and diversity in the boardroom.
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Also see our other 2023 board and committee messages
KPMG's annual messages to directors focusing on the critical issues that should be high on board, audit committee, nominating and governance committee, compensation committee, and private company board agendas.
KPMG's annual messages to directors focusing on the critical issues that should be high on board, audit committee, nominating and governance committee, compensation committee, and private company board agendas.
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