London, 2 December 2013
FT-ICSA survey reports surge in confidence in UK economy but lack of trust in company pay arrangements
Confidence in the UK economy is growing, but there is still some way to go before public trust is restored in company pay arrangements. These are just two of the findings of the fourth FT-ICSA Boardroom Bellwether survey, the bi-annual survey produced by the Institute of Chartered Secretaries and Administrators (ICSA) and the Financial Times (FT), which canvasses the views of FTSE350 company secretaries to determine UK boardroom sentiment on a range of business issues.
Significantly, 80% of survey respondents believe that UK economic conditions are improving compared to just 28% of respondents in the inaugural March 2012 survey. The latest survey also reports an improvement in economic outlook globally and within industry sectors with 69% and 56% of respondents expecting to see improvements over the next 12 months respectively.
In terms of shareholder engagement, the survey reveals that the number of companies with a plan for engaging with investors has risen sharply from 60% to 87%. Boardroom diversity, including gender diversity (up from 32% in July 2013 to 51%), is also revealed to be on the increase, with wider business experience and geographical diversity improving as well.
With regard to remuneration, however, the findings show that there is still some way to go before public trust is restored in company pay arrangements, with 76% of respondents feeling that public concerns will not be allayed by new remuneration guidelines. Peter Swabey, Policy & Research Director at ICSA feels that companies should ensure that remuneration is “less about planning changes to various aspects of pay in response to media coverage, political pressure and public anger, and more about improving the alignment of pay with performance. It’s a simple matter of encouraging trust through good governance.”
Other findings of note from the survey are as follows:
• There is a growing perception that the Coalition Government is more business friendly than the Opposition – the first time that perceived business-friendliness of the Government has outstripped perceptions of business-unfriendliness;
• More companies are taking cyber risk seriously. The number of companies which has discussed the Government guidance on cyber risk has jumped from 21% to 67%.
“It is great that we are seeing UK boardrooms address some of the points raised in the last survey. More companies are taking cyber risk seriously, evaluating that risk for their company and taking steps towards action,” comments Peter Swabey.
“As a gauge of market sentiment, the survey is increasingly important. Tax breaks to stimulate growth, green tariffs through general taxation and increased enterprise in the UK through streamlined legislation and regulation are just some of the things with which UK companies are currently preoccupied.”
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Notes to Editors:
1. The FT-ICSA Boardroom Bellwether is a twice-yearly survey which seeks to gauge the sentiment inside UK boardrooms. The findings show how boards are positioning themselves to address the challenges of the economy, and the wider business and social climate in which they operate. Current and past Boardroom Bellwethers can be viewed here: www.icsa.org.uk/bellwether
2. The Institute of Chartered Secretaries and Administrators (ICSA) is the membership and qualifying body for professionals working in governance, risk and compliance, including company secretaries. Our members work in all sectors and at every level of seniority. With over 100 years of experience, we champion high governance standards by providing qualifications, training, high-quality guidance and support (including technical resources, publications and software), and through our work with regulators and policy makers. Website: www.icsa.org.uk
3. The Financial Times, one of the world’s leading business news organisations, is recognised internationally for its authority, integrity and accuracy. Providing essential news, comment, data and analysis for the global business community, the FT has a combined paid print and digital circulation of almost 629,000 (Deloitte assured, Q3 2013). Mobile is an increasingly important channel for the FT, driving more than a third of FT.com traffic and a quarter of digital subscriptions. FT education products now serve 32 of the world’s top 50 business schools. Website: www.FT.com