16 trends boards should watch

What are the trends directors should watch in 2022 and beyond? Across all sectors, 2021 saw organisations grappling with the effects of global shifts in the way organisations do business exacerbated by challenges such as the pandemic and climate change, and 2022 is no exception. The following major business trend predictions offer a glimpse of what is in store for boards.

According to Bob Semple, an experienced independent director and member of the Governance Advisory Council of the Corporate Governance Institute, the key areas today’s directors should study and learn about include:

• ESG
• Corporate purpose
• Cyber
• Third-party risk management
• Machine learning and AI
• The digital corporation (big transformation issues
• Transformative, disruptive technologies – esp. bio-, info-, nano and cogno-
• Mining big data
• Equality, diversity and inclusion
• Remote working
• Privacy
• Finance transformation (the FD is dead, long live the chief value officer)
• Integrated reporting / GRI (and the new standards bodies: ISSB, GSSB)
• RegTech and FinTech
• Blockchain
• Culture (board and organisation)

Let’s examine three of the main areas in more detail.

UK Treasury plans suggest that all publicly traded companies report climate data by 2022, complying with the TCFD’s standards.

However, the consumer demand for sustainable change is also responsible for many companies making moves. They realise that more needs to be done independently.

The decarbonisation of the supply chain is a sensible and obvious place to begin for many businesses. Still, more forward-thinking companies are looking beyond this point to make all their operations more sustainable.

Sustainability and resilience go hand in hand, so the business trend of sustainable operations is expected to accelerate in 2022 and last for decades.

Companies that ignore sustainability will not succeed in this new era of conscious consumerism.

Many businesses rely on highly-capable robots and artificial intelligence (AI) for greater efficiency and productivity. This trend is set to accelerate further in 2022.

In 2022, Gartner predicts that revenue from AI software will reach $62.5 billion, an increase of 21.3% over 2021. Gartner also predicts that in 2022 the top five use cases for AI software will be artificial intelligence (AI), knowledge management, autonomous vehicles, and digital workplaces.

Businesses will have to address these developments and find a way to successfully work with AI and robots in the changing times.

Forrester warns, however, that company leaders must consider the psychological impact of AI automation on their workers. Short- and long-term profits are likely to be hurt by failing to do so.

The trend of remote and hybrid working is expected to continue in 2022. In 2022, Gartner predicts that 31% of all employees worldwide will work remotely, despite significant differences in IT adoption, culture, and industries in various countries. Additionally, Gartner predicts that the US will have 53% of the US workforce as remote workers by 2022. Remote workers in the UK will make up 52% of the workforce.

In 2022, flexible work is expected to gain more traction, especially in the UK. The UK government has announced that employees can now request flexible working from their company. This includes remote working options and compressed hours, working fewer or different hours than usual, or job sharing.

The new rules do not obligate employers to accept employees’ requests, but it is hoped that they will encourage more flexible working within the UK and provide a better and healthier work-life balance for employees.