BACKGROUND AND OBJECTIVES
The collapse of trust in big business and its leaders has become the biggest corporate issue of our time. Together with the rise of citizen journalism, the demand for greater transparency and the increasingly hostile and activist nature of shareholders, the spotlight is trained on companies’ management teams and boards as never before.
Shareholders and customers seek reassurance that businesses are being governed effectively and ethically. At the same time, the increasing number of high-profile reputational crises that have erupted over the past 12 months – think Thomas Cook, HSBC and Volkswagen – are a reminder of how those firms that have erred get treated.
Not only are these sagas played out in excruciating detail across the world’s media, but board members are frequently hauled before MPs at select committee meetings and asked to justify their actions.
As a result, the need for boards to better manage their corporate reputation and identify potential risks in this area has never been more critical. Consider that reputation contributes £790bn of shareholder value – 36% of the market capitalisation of the FTSE 350 – according to the latest UK Reputation Dividend Report.
Yet, when looking at the make-up of UK boards, particularly those of companies in the FTSE100, non-executives with these skills are noticeable by their absence. And this is at a time when chairmen are being pressed to ensure they have a range of diverse voices in the boardroom – diverse defined not just by gender or race, but also by professional discipline.
Against this backdrop, Cayhill Partners was keen to establish why, when so many of the skills and experiences gained from a career in corporate affairs could potentially add tangible value around the board table, so few corporate affairs directors secure NED roles or transfer into other senior roles in different functions of a business.
Over several months, Cayhill Partners interviewed (both face-to-face and online) more than 100 communications leaders in publicly-listed and other large organisations about their career aspirations and their views on NED roles.
We also carried out face-to-face interviews with selected FTSE chairmen, as well as conducted telephone interviews with a number of NED advocacy groups. In addition, we interviewed a number of ex-corporate affairs directors who now hold a range of senior, non-communications posts.
Keen to ensure that contributors to this research felt able to give their frank and honest opinions, we committed to ensuring that all comments contained in this report would be non-attributable. We would like to thank those who gave their time and insight so generously.
Communications leaders go under an array of different job titles. Throughout this report, we have used the term corporate affairs director, corporate communications director, communicator and communications leader interchangeably to denote the most senior communications practitioner in any given organisation.