Boards held an average of 9.7 meetings in the period under review, of which an average of eight were scheduled, slightly fewer than the 8.3 recorded in 2021.
The number of ad hoc meetings fell by 32% as businesses learned how to cope with the aftermath of the Covid-19 health crisis, dropping from 6.9 in 2021 to 4.7 in 2022. However, the incidence of ad hoc meetings remains higher than the 3.6 recorded pre-pandemic.
Ad hoc meetings distribution
|Number of meetings
Directors must commit significant time if they are to perform their board roles effectively, especially given the increasing responsibilities and scrutiny that listed company boards face today. The 2018 UK Corporate Governance Code does not specify the maximum number of boards a director should take on, but investors and proxy voting advisers are increasingly focused on ensuring that directors do not over-extend their responsibilities, adopting their own points systems to flag “overboarding”.
There is rising agreement that best practice for a director with a portfolio career is that they should not take on more than four concurrent board roles (a chair role counts as two). For current executives the limit is one outside corporate directorship. Hitherto, scrutiny has focused on quoted corporate directorships but there is growing recognition that large private company and not-for-profit boards may require similar amounts of time and effort and should also be taken into account when assessing directors’ commitments.
65% of non-executive board members have additional listed company board commitments, and one-third of non-executive directors balance their board responsibilities with executive positions.
Chairs hold on average 1.4 external quoted board mandates. 25% of chairs hold at least one other public company board chair role and 18% of them hold one other FTSE 350 chair role.
There was a slight increase in the number of CEOs holding outside board directorships from 31% (45) in 2021 to 35% (50) in 2022. The figures for CFOs in the same period rose from 22% (29) in 2021 to 26% (35) in 2022.
The current UK Corporate Governance Code recommends that an external independent board evaluation should be conducted every three years. 95% of companies disclosed that they conducted an annual board evaluation during the period under review. 49% (74) of them ran an externally facilitated review, up from last year’s 44% (66).