The corporate governance director at L&G, Sacha Sadan, said the fund management group was concerned that only about half of chairmen in the FTSE 350 thought their board understood the impact of lost data and information on their businesses.
“Cybersecurity is a tier one threat to the UK’s national interest alongside acts of terrorism and natural hazards,” Sadan said in his annual outlook on corporate governance issues.
He said L&G supported efforts by the government and regulators to set minimum cybersecurity targets for companies.
“Boards need to be aware of these threats when making strategic decisions or building processes to support the business,” he said.
He is also calling on companies to review the effectiveness of their boardrooms in terms of diversity and succession planning.
While companies are required to have their boardrooms evaluated by external examiners every three years, L&G has found companies use various methodologies. Some assessors did not even attend board meetings.
Sadan said: “We want all companies in the market to undertake board reviews that are rigorous and a valued added-exercise, not just undertaking a review because they have to or to tick a box.”
L&G is involved in creating a code to set what evaluations of boardrooms should entail.
Sadan repeated L&G’s pledge to vote against the chairman of FTSE 100 companies which continue to have all-male boards next year. L&G voted against resolutions at 153 companies during the recent annual general meeting season.
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