Every six months, ICSA's soundings of the mood in British boardrooms yields a range of interesting nuggets. This latest survey is no exception. Most striking is that FTSE 350 company secretaries are gloomier about the UK and its economic prospects than they were even this summer, and considerably gloomier about the rest of the world. This is hardly surprising given that, as Dame Alison Carnwath of Land Securities put it to me, we are "at war". But, allied to concerns over growth in the emerging markets, and market jitters in China, it does not encourage companies to open the purse strings and start spending on the future. Only just over a quarter of Boardroom Bellwether respondents said they had plans to expand over the next twelve months.
The findings on growth were particularly interesting because they do not chime well with macroeconomic data. Recent PMI surveys, and industrial output numbers are not glowing – but they still suggest that activity is increasing, rather than decreasing. The view from the ground is very helpful in balancing that optimism.
Part of the uncertainty facing company secretaries, of course, is over whether the UK will leave the EU after a referendum on the topic, which could come as early as next year. The Bellwether suggests boards are increasingly putting their minds to the issue, with the number of company secretaries worried about the impact of a Brexit on their business rising sharply. They may be worried, but that doesn't seem to be translating into the requisite planning and preparation. Only a quarter of boards are actively considering the implications of a Brexit.
Not only are they not running the scenarios, but they remain unwilling to speak out about the impact of an EU exit – whether positive or negative. Only 4 per cent of company secretaries said they were prepared to do so – a tiny number given the importance of the issue. It is depressing that some of the scare tactics employed by the Out campaigners (Vote Leave, for example, recently disrupted the CBI's annual conference) seem to be working. It is understandable that business feels wary about coming down on one side or another of the debate, for fear of alienating customers, employees or other stakeholders. But all the polling suggests that voters are desperate for real information on what an exit from the EU would look like for the UK – information that businesses are in a prime position to provide.
On a more positive note, this Bellwether found that smaller British companies are diversifying their boards. Only a fifth of FTSE 350 companies have hit the Davies target of having women making up a quarter of their members. But the number of companies who say they will make that target over the next year has doubled from a year ago to 31 per cent. There is much more that needs to be done in reforming the UK's boardrooms – but genuine progress has been made.
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