As part of a new Global Corporate Affairs partnership, Oxford University and GlobeScan are working together to help senior executives and corporate affairs leaders around the world to develop the contribution and improve the impact of the corporate affairs function.
In our inaugural Oxford-GlobeScan Global Corporate Affairs Survey 2020, we captured the views of Corporate Affairs Professionals on issues and themes of relevance to the function. Key research findings are summarized below.
Most Pressing Global Risks to Business
The most pressing global risks facing Corporate Affairs Professionals today are: geo-political (47%), ESG (45%) and macroeconomic (27%).
Around half of respondents cited geopolitical risks as the top critical risk reflecting worries about the Volatile Uncertain Complex and Ambiguous (VUCA) nature of global politics, uncertainty around the increasing role of government in business, a perception of increasing regulatory intervention and the rise of nationalism and populism.
Just over a third of respondents mention ESG risks in their top three risks which puts ESG issues firmly on the Board agenda. Delving deeper into the specifics around ESG risks, the survey findings reveal that there is a dominance of E (environment) in the concerns with 94 percent of ESG concerns revolving around the environment compared to just over 50 percent each for social and governance.
Macroeconomic risks were the third most mentioned global business risk. Within this Asia Pacific and the US show the highest levels of concern (41% and 35% respectively) but perhaps a more interesting picture emerges when looking at this issue by sector. Consumer products and retail sectors expressed the most concern, being most immediately influenced by macroeconomic worries.
Priorities of the Corporate Affairs Function
Functional priorities that are top of mind for corporate affairs professionals include protecting reputation and building trust, stakeholder engagement, sustainability strategies and assisting with ESG reporting while ensuring transparency overall.
Around 30 percent of all respondents focused on these four issues with reputation/trust and stakeholder engagement taking the top slots. These two issues are critical to the function and are of great importance when it comes to priorities. The addition of ESG reporting and transparency reflects the growing importance of these issues within Executive Committees and the Board, while the inclusion of sustainability strategies speaks well to a more strategic engagement of the function within critical business decision making.
When comparing these priorities to three years ago, the most prominent priorities identified are mapping purpose (56%), mapping context (56%) and mapping risks (52%).
Purpose and Trust
Of the issues identified as critical for Corporate Affairs Professionals, there were two that stood out – the work on purpose and the drivers of trust. Taking a deeper dive into the details behind each insight concluded that more has to be done for purpose to be embedded firmly into strategy, articulated to employees, and effectively stewarded by corporate leaders.
In terms of mapping purpose, most companies (85%) reported that they believe that their company has a well-defined purpose, 58 percent reported leadership buy-in and 54% feel that purpose is aligned to strategy. Only 30% indicated that their employees are engaged on the subject and this is seen as a major area for improvement.
On the issue of trust, there are generally low-to-mid levels of trust in business. Corporate character traits such as integrity, honesty and relationships dominate as drivers of trust.
Effectiveness of the Corporate Affairs Function
Just over half of respondents (52%) believe that the Corporate Affairs function generally creates significant value, while less than half of those surveyed (42%) believe that their own function creates significant value. This is particularly acute within North American organizations (31%) and in terms of sectoral findings, this is even more marked in financial and professional services, where only 19% believe that their function creates significant value.
There are three main reasons for why the impact of the Corporate Affairs function is less significant than it should be. Firstly, it relates to the poor levels of connection between Corporate Affairs and other critical business functions (27%), leading to a disconnect when it comes to insights into wider business strategy.
The second reason relates to the function being perceived as too tactical and reactive (25%) and the third is perceived to be the lack of senior investment and support for the function (25%).
Governance of the Corporate Affairs Function
We also looked at how the Corporate Affairs function is governed in an organization and asked respondents to identify their direct reporting line and describe what responsibilities are included in the function. The majority of those surveyed (just under one third) report directly to the CEO, with 68 percent of those in Europe reporting directly to the CEO (68%). This is followed by the US at 50 percent, with Latin American respondents reporting the smallest percentage (12%).
When looking at the overall composition of the broader Corporate Affairs function, we asked respondents to record the functions that they include within their remit. The most cited functional responsibilities included were Government Relations and Internal Communications (both at 70%), reflecting the increasing role of Government within business affairs, and the increasing focus on building strong employee and engagement strategies. These were followed by the more traditional functions of Media Relations and Stakeholder Relations/Engagement (both 69%), Industry Relations and Sustainability follow at 57 percent.
COVID-19 has changed the way in which the Corporate Affairs function is expected to contribute and be governed. Nearly six in ten respondents (57%) stated that Corporate Affairs is expected to take the lead in their organizations’ COVID-19 response. Over six in ten (64%) report greater access to the CEO as a result of the COVID-19 crisis.
For more information, please contact:
- Stacy Rowland, GlobeScan: firstname.lastname@example.org, +1 416-992-2705
About the Oxford-GlobeScan Global Corporate Affairs Partnership
In 2020, Oxford University and GlobeScan launched a partnership to join forces and work together to leverage their combined expertise in Corporate Affairs. The primary purpose of the partnership is to generate valuable, actionable research findings for organizations, senior executives, and corporate affairs leaders to improve the impact of the corporate affairs function. Oxford University and GlobeScan will do this by engaging and sharing new thinking and practices that would empower the corporate affairs community, the media, fellow researchers, and others through regular and timely insights about the evolution of the corporate affairs function and its agenda.