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Boards Around the World: Navigating Stormy Seas

February 2025

Our latest edition of Boards Around the World explores how boards of public companies around the world compare on a range of governance measures.

Board members are under pressure like never before.

Yes, they still have to juggle traditional tasks such as oversight of strategy, performance, risk management, reporting and compliance, while ensuring that shareholder expectations are met. But such priorities are being pursued amid an external environment as turbulent as it is fast-changing.

From geopolitical disruption, rampant advances in artificial intelligence, political interventions and widespread social upheaval, board agendas are brimming with interconnected challenges that have left our world in flux. No wonder having the right number and blend of leaders around the boardroom table is so important.

Global data and trends in board composition and performance, board governance practices, and director compensation have fallen under Spencer Stuart’s spotlight for more than three decades. Through our annual Board Indexes, published in over 20 countries, we examine governance practices among leading public corporations in various countries, localities and industries.

Here are some of the highlights from our 2024 data.

Board composition

Board size: One might assume that as the number of board issues have increased, so, too, would the average number of board members. But actually, board size has remained relatively static over the years. The most common board size remains between nine and 11 though there are a few exceptions.

Rather than adding to their number, boards are having to plan for the succession of non-executive directors carefully to ensure that new directors are able to offer skills and experience most relevant to the organisation’s needs. Static board size also means tapping into outside experts on different subjects as and when required and being able to pivot quickly in response to a fresh opportunity or impending crisis is vital. German companies, for example, have an average of 16 board members due to the codetermination law that requires nearly half of supervisory board members to be worker representatives.

Independence: Gone are the days where independent directors were in the minority of listed-company boards. Today, our analysis has found that only in four countries (Brazil, Chile, Spain and Turkey) do fewer than half of directors fit the local criteria for independence.

Amidst the ongoing global tumult, objectivity and impartiality are vital traits for board members seeking to constructively support management during times of stress and challenge. It should also be noted that some governance codes require a majority or all committee members to be independent, a demand which has further fueled the long-term trend towards greater independence.

Level of independence in the boardroom

92%

Finland and Switzerland

85%

U.S.

58%

France

25%

Chile

Tenure of directors: Boards have long sought to marry the need for experienced directors who have run major businesses, with the desire for individuals who can offer a fresh injection of energy or insight based on up-to-date expertise in a specific industry or market. Seeking this outcome is one thing, actually achieving it is something else entirely.

In Mexico, for instance, the average tenure for board members is 12 years, up from 11 years in 2018 — considerably higher than the international average of 5.4 years. At four years, Finland now has the lowest average director tenure, up from last year when Spain’s 3.7-year average was the lowest in our analysis.

Board refreshment remains a critical topic and is made harder when there are no term limits in place. In the U.S., board turnover has been at 7% to 8% for the past five years. To best help a company to succeed, its board must keep itself fit for purpose and aligned with the evolving needs of the company. It must have the foresight to be able to see which knowledge gaps will need to be filled, the determination to conduct and act on critical evaluations, and the courage to make difficult decisions, such as asking directors to step down when necessary.

In turn, directors need to have the confidence and self-awareness to know when it is time to roll off the board. In other words, they need to acknowledge when their skills are no longer prioritized in the boardroom, when their recency of experience has ebbed, or when their tenure is an impediment to board refreshment.

4 years

Lowest average director tenure,
Finland

12 years

Highest average director tenure,
Mexico

First-time directors: In 2024, the proportion of newly appointed directors joining the board of a publicly traded company for the first time grew, most notably in Ireland, Italy, Norway, Spain, Turkey and the U.S. One exception was Switzerland, where the proportion of first-time directors halved from 63% to 31%.

There are many reasons why board chairs and the heads of nominating and governance committees are taking on more first-timers, the most common being their ability to bring new perspectives from the front line. In the U.S., for example, first-time directors are much more likely to be actively employed (67%) than retired. They are also much more likely to be actively employed than directors who are not first-time directors (43%).

Gender diversity in the boardroom

Diversity remained an important factor in director hiring decisions during 2024 across many different dimensions. However, varying definitions and disclosure requirements across different geographies impacts statistical consistency and so here we focus only on the issue of gender diversity.

Female new directors: The proportion of women among newly appointed directors is often a good indicator of the broader progress towards gender balance. Ireland still leads the way at 65% but the latest data tells a story of a slowing pace of change in several countries. Sweden, which was second last year, is down 10% to 49%. There was also a drop in the proportion of women among new directors in both the U.S. (42%) and the U.K. (49%).

It is not all bad news — Belgium, for example, went from 18% last year to 50% this year and Germany increased from 40% last year to 55% this year.

One cause of the slowing pace towards gender balance could be that many companies have already met the minimum targets and have consequently relaxed their efforts. Most European countries have either government-backed targets or legal quotas to achieve greater gender balance in the boardroom, but this is rarer outside of the region.

Closing the gap: In eight countries, half of all boards have at least 40% women. Last year only four countries had passed that threshold. Most gender targets have increased from 30% to 40% women in recent years and the impact of these targets is clear to see: in the U.K., for example, 29 boards achieved gender parity, up from 18 in 2023. In an unprecedented move, the Hong Kong Stock Exchange (HKEX) introduced a rule in 2022 stating that single-gender boards would no longer by allowed on HKEX markets after the end of 2024.

Women in the boardroom

46%

France and Norway

40-43%

Ireland, Italy, Netherlands, Sweden and the U.K.

34%

U.S.

18%

Mexico

Women are still underrepresented in board leadership: Neither quotas nor targets have altered the fact that board leadership remains overwhelmingly male. This year’s sample shows that there are only seven countries where women occupy more than 10% of board chair roles — up from five last year. The U.S. continues to lead the way with 18% of S&P 500 companies being chaired by women. South Africa comes next, with 17% — a substantial increase from last year when only 3% of its boards were chaired by a woman. Although women are well-represented on Nordic company boards (40% of board directors in the region are women), when it comes to female chairs only Norway gets into double figures (12%).

France and the U.K. have the largest share of female CEOs with 12% respectively. Disappointingly, several countries (Denmark, Finland, Netherlands, Norway, Switzerland and Turkey) have no women CEOs at all. Given this ongoing gender imbalance, businesses must double down on efforts to address the executive pipeline and create leadership teams that better reflect the diversity of the markets they serve.

Compensation

Switzerland and the U.S. reward listed company directors with the highest fees. We found that the average total compensation for Swiss chairs in 2024 was €1,899,492 ($2,045,835), well ahead of next placed France, where they received an average of €692,760 ($746,132). When it comes to non-executives, U.S. S&P directors earnt €303,698 ($327,096), with their Swiss counterparts coming next with an average of €226,601 ($244,059).


Visit our Boards Around the World website feature to see graphical versions of our global comparisons.


Related Insights

Our Board Indexes provide a comprehensive view of governance practices among leading public corporations in various countries, localities and industries.

An interactive exploration of how boards around the world compare in terms of diversity, composition, compensation and more.

Spencer Stuart has long played an active role in corporate governance by exploring key concerns of boards and innovative solutions to the challenges they face.