When we began conducting our research on the visibility of different board members, we didn’t know what to expect, but we were still surprised by the startling results that we did receive. We asked 1,000 employees of companies with more than 500 staff to name different members of their board.
It came as no surprise that the CEO was the most recognised, however still only 36% were able to name them. Of all the positions that we enquired about, one of the least visible roles in our results was the Company Secretary. A staggering 85% were not able to name their organisation’s Company Secretary. If you split this down by sector, it becomes even more alarming, with only 6% of professional services and public sector employees able to name their Company Secretary.
Why do we believe the role should be more prominent?
The Company Secretary role is a unique one in many organisations. Simon Osborne, chief executive of the Institute of Chartered Secretaries and Administrators (ICSA) defines the role as ‘(an) advisor to the chair and the board on a company’s values, purpose and governance framework.’ In short, the company secretary is the conscience of the business.
Ensuring that an organisation complies with relevant legislations and regulations is an incredibly complex job, yet it has not been a legal requirement for private companies to employ the services of a Company Secretary since a law change in April 2008, and some companies choose to do without the role all together, but what does that mean for them?
The burden of this roll then falls onto the directors of the organisation itself, and despite the fact that the role is not legally required for all, the penalties handed out for failing to comply are very much still applicable to these companies, and the liability then falls on the directors themselves if this work isn’t undertaken. So most organisations do choose to have a Company Secretary.
2008 turned out to be a pivotal year for business
The timing of the law change regarding Company Secretaries in the UK could not have come at a worse time, with the spotlight shining brightly on good governance in the wake of the financial crisis that shook the world. The increase in government interest in governance as well as a greater public consciousness of the subject has made the role of the Company Secretary even more complex and demanding than it was before.
Even with this increased pressure for greater transparency, the role is still misunderstood and under-represented it seems. An executive director of a FTSE 250 organisation in 2012 was quoted as saying “Other than form-filling and complying with rules of little substance, I don’t think there is much [of a] role for a company secretary. This is a glorified clerical position.” Our survey of UK employees seems to enhance this under-representation further.
eShare believes that better business starts with better governance, so with this in mind we conducted an in-depth study into this role and how the complexities of modern business are impacting the position and the people that hold it. This study has been collated into a free white paper which can be downloaded here, and is essential reading for those seeking to understand how vital the role is for businesses in achieving good governance.
If you would like any further information about our research, or how eShare’s solutions can help with the process of good governance, you can contact us on our website, via email at firstname.lastname@example.org or by calling the head office on +44 (0)845 200 7829.