Spencer Stuart's annual survey of Nominating/Governance Committee chairs revealed these noteworthy results based on the input of 141 S&P 500 and MidCap 400 participating chairs.
Priorities — Just 35% of respondents identified ESG oversight as among their top five priorities compared to 65% last year. Taking the top spot this year is board composition (56%). Other top priorities include CEO succession (52%), board performance/effectiveness (30%), and board diversity (25%).
Refreshment — Top drivers of refreshment this year were mandatory retirement or term limits (up significantly year-over-year) and adding new skills to the board (generally on par with 2022), as shown here:
Notably, there has been a steep rise in using board and director evaluation results to trigger board refreshment, which is a favorable trend.
Recruitment priorities — A plurality of respondents identified financial expertise as the top director recruitment priority, which Spencer Stuart attributes largely to natural turnover of financial experts rather than newly discovered skills gaps on the board. Otherwise, boards are prioritizing retired and active CEOs/COOs and candidates with operational experience.
Approximately 20% of boards are seeking tech-, digital, or cyber-specialist directors (21%, 20%, and 19%, respectively) and 19% are prioritizing gender or racial/ethnic diversity.
Education — More than three-quarters of respondents identified industry trends and emerging issues as their top educational opportunity, followed by cybersecurity at 60%.