Key corporate governance trends and insights for 2024
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4 November 2024

Corporate governance is evolving at an unprecedented pace, with boards and leadership teams facing an array of new challenges and heightened expectations. We identify several key trends.

Technology’s Transformative Role

As Artificial Intelligence (AI) and other digital tools evolve, it becomes increasingly challenging for boards and supervisory boards to keep a grip on the ethical and operational implications of these technologies. Generative AI, fuelled by the success of platforms like ChatGPT, has led to increased interest in boards regarding AI ethics, impact on employees and privacy. Moreover, digital regulations in the European Union (EU), particularly the Digital Services Act (DSA), will impose stricter standards for data processing. In doing so, directors and supervisory board member are challenged to balance innovation with digital risk management. 

Expanded Due Diligence and Social Responsibility Across the Value Chain

Under intense societal scrutiny, companies are expected to take a broaderview of their entire value chain and make it more responsible. Stakeholders now demand not only ethical business practices but also transparency around partners and suppliers. New EU regulations on ESG due diligence and whistleblower protections underscore the importance of supply chain oversight, where companies are urged to perform regular audits on metrics like CO₂ footprint, social impact, and anti-corruption measures. Furthermore, fostering a culture that encourages employees to report misconduct is essential. The social conscience of companies thus increases in importance.

Advancing Diversity: Building Balanced and Inclusive Boards

Diversity remains a top priority, with boards and supervisory boards seeking representation from different backgrounds, skills and perspectives. Gender diversity in particular has achieved important milestones in markets such as Europe and Australia. By 2023, women hold more than 40 per cent of board positions in France, Italy and the UK, and similar shifts are underway in Germany and the US. The Netherlands does not yet reach this figures. We expect continued attention to this issue, also in view of the ingrowth quota and targets Act in force since 1 January 2022.

Governance as a Growth Driver: Compliance Meets Innovation

Governance is no longer just about supervision and compliance; it is increasingly a catalyst for innovation and growth. Regulatory shifts, particularly in sustainability, are opening doors to new business models and markets. Established companies are also finding new sales opportunities as they adapt to changing regulatory standards. Forward-looking boards and supervisory boards will bet on governance frameworks not only to ensure compliance, but also to drive sustainable growth.

Bridging the Expectations Gap: Aligning Governance with Societal De-mands 

In an era where society and stakeholders are becoming increasingly critical, boards and supervisory boards face higher expectations for impactful governance. After the covid pandemic, the emphasis on stakeholder capitalism and proactive oversight has only grown stronger. Boards and supervisory boards of today can address challenges before they escalate and meet increasing stakeholder expectations for ethical and responsible governance. As stakeholder expectations continue to rise, boards and supervisory boards that adopt adaptive and transparent governance practices will be better placed to confidently lead their organisations through today's complex landscape.

Written by:
Paul de Vries

Key Contact

Amsterdam
Paul de Vries
Notaris | Partner
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