Directors Quarterly: October 2023

Geopolitics and the board, advancing the conversation on climate, financial reporting updates, and staying in sync with internal audit.

Geopolitical risks are a top concern for business leaders responding to our 2023 US CEO Outlook, reflecting an increasingly fragmented global economy that is more susceptible to external shocks. Given the global nature of many of the issues that companies are facing, from climate change and supply chains to data privacy and artificial intelligence, it’s not surprising that geopolitical risks are top of mind for CEOs. In light of the operational, regulatory, and reputational implications of these global issues, it’s clearer than ever that the US is not an island.

In this edition of Directors Quarterly, we detail steps to help boards take a holistic approach to the oversight of geopolitical risk. We also share insights from interviews with board members and business leaders about the changing board-management conversation on climate. Those discussions are increasingly focusing on value creation, risk, talent, and communication—all critical business issues.

In addition, we highlight financial reporting and auditing developments that audit committees should be paying attention to this quarter, including California’s climate disclosure laws and recent updates from the SEC and PCAOB. Finally, we detail ways to enhance the audit committee–chief audit executive relationship, which is increasingly important for staying attuned to the company’s changing risk profile.

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