Corporate Boards Still Rely on Paper, Not Technology
Technology continues to change how businesses operate, but corporate boards have still largely not embraced technology and continue to rely on traditional methods to communicate with their members using hard copies of board books and documents, according to a recent survey conducted by Thomson Reuters Governance, Risk and Compliance (GRC).
The average corporation surveyed prepares and disseminates nearly 6,000 pages of sensitive material to their board every year, with some companies producing more than 200 board packs per year. This significant volume of highly sensitive and confidential material is required to be distributed to board members, and a majority of corporations still send those documents via traditional courier.
When corporations communicate to their board members via email, an overwhelming majority of respondents confirmed they send documents to board members via private, non-commercial email addresses. Even if the documents arrive safely and securely via email, three-quarters of board members surveyed say they print and carry those sensitive documents, further exposing them to loss or theft.
Most organisations surveyed are vulnerable to one or more of the following security issues involving their communications to board members. Following is a snapshot of ways that material is shared with board members, according to the survey:
“Many boards still operate in the traditional sense by providing hard copies of documents to their members via post,” said Kevin Ritchey, senior vice president (SVP), governance, transactions and legal risk for Thomson Reuters. “Embracing technology and using it to your advantage can alleviate numerous risks, improve communication and efficiencies, and maintain a secure, centralised archive of records. In a time when corporations should be relying on secure, instant communications to make decisions against rapidly changing global markets, board communications often remain mired in slow, unsecured, inefficient traditional means of communications.”
Despite international travel commitments and members working in multiple time-zones, less than 25% of the corporations surveyed use any form of board portal technology.
As boards are increasingly dispersed around the globe – more than 80% surveyed responded that some or most of their board members extensively travel internationally – providing sensitive and timely documents to board members without compromising security and confidentiality is a challenge numerous corporations face. Embracing technology can decrease the possibility material is delayed or lost, as well as create efficiencies and cost-savings to the organisation.