A survey by AuditBoard, a cloud-based platform for audit, risk, compliance, and ESG management, reveals that 88% of audit, risk, and compliance professionals view compliance with the upcoming UK Corporate Governance Code reforms as a top priority for 2024, with the industrial and technology sectors feeling the greatest urgency.
With the reforms set to take effect on 1st January 2025, organisations across various sectors are working to align their governance practices with the updated standards. The report suggests that companies that proactively embrace the new code can turn compliance into a competitive advantage by enhancing resilience and improving overall business performance.
The research titled ‘UK Corporate Governance: Turning Compliance into a Strategic Advantage’, delves into how organisations are preparing to meet the UK Corporate Governance Code revisions, identifying several important trends.
AuditBoard, in collaboration with Ascend2 Research, conducted the survey in July 2024. The survey included 264 internal audit professionals and organisational leaders from companies in the United Kingdom with over $25M in revenue. Participants were all in managerial roles or higher and represented a range of departments across different industries.
The report finds that there is a potential disconnect within organisations, as executives place higher importance on compliance than management-level respondents. While 86% of organisations are confident they will achieve full compliance by 2026, those in regulatory compliance roles expressed less confidence than their ESG and internal controls counterparts.
The reforms are expected to significantly impact workloads, with 89% of professionals anticipating a rise in responsibilities. Companies already compliant with the code are feeling the most strain in resource allocation.
Over half of the organisations surveyed are using AI to enhance their governance processes, particularly for automated control testing and generating insights into trends. This highlights the growing importance of technology in corporate governance.
“As the UK Corporate Governance Code approaches, companies should view the updated Code as more than a checklist item. It’s a chance to improve their internal control systems, enhance strategic decision-making, and build a more resilient organisation. By adopting a standardised approach to risk and control management, businesses will satisfy regulatory requirements and position themselves for competitive advantage and long-term success in an increasingly complex and competitive environment,” said Jason Sechrist, EMEA Director of Product Solutions.
