Emerging Issues for Boards in an Evolving Business Landscape

By Joan Conley, Senior Advisor, Corporate Governance and ESG Programs, Nasdaq and James Beasley, Head of Board Advisory, EMEA, Nasdaq with contributions from Vanessa Mesics, Head of Director Experience, Co-Head of the Nasdaq Center for Board Excellence, Nasdaq

Updated to reflect emerging issues that boards are focused on in Q3 2025.

Effective corporate governance is crucial for companies—and their boards—to successfully navigate ambiguous times. The Nasdaq Center for Board Excellence team’s work with thousands of board members and executives around the world has surfaced emerging corporate governance issues across eight key areas:

1. Global and Domestic Geopolitical Trends

In the face of global geopolitical and economic uncertainty and unpredictability, it is imperative for board members and executives to stay informed about potential impacts on their company’s strategy, goals, workforce, and operations. Boards and management teams may consider increasing discussions, pivoting capital, and evaluating investment and risk oversight strategies. Moreover, amid political developments, they should assess the impact on their company’s supply chain, workforce strategy, capital investment, risk management, and regulatory and compliance matters.

2. Strategy and Risk Management

Boards and committees are reassessing their company’s process for identifying risks and opportunities for potential disruption. Key considerations include identifying geopolitical, cybersecurity, economic, activism, technological, digital, social, and environmental factors, and understanding their impact on long-term strategy and capital allocation decisions.

Boards are encouraged to review the company's risk register and, as appropriate, incorporate cybersecurity and artificial intelligence (AI) into the top five risk factors. In addition to cybersecurity and AI, geopolitical and reputational risks should be in focus when discussing the corporate strategy. As necessary, boards may bring external experts into the discussion and conduct internal ‘scenario planning’ exercises to support preparedness and resilience.

3. AI and Emerging Technologies

Board member upskilling and education on AI and emerging technologies is a new imperative. It is critical that boards understand the right balance of process, procedure, and investment for AI. Moreover, boards should discuss business objectives, goals, and ROI on productivity related to AI initiatives and alignment with the company’s overarching strategy. Some companies are strengthening their AI internal management governance structure, including the establishment of AI governance committees and the emergence of roles like Director of AI and Director of AI Security.

In response to digital transformation, companies are revisiting workforce recruitment and reskilling strategies to foster innovation and further operational efficiency in an increasingly AI-driven ecosystem. Companies are providing mandatory training on AI ethics, among other corporate ethics and compliance topics, for all employees.

4. Sustainability

There has been a shift from a compliance mindset to viewing sustainability as a value-driver. It is important to embed climate, environment, and sustainability goals into strategy, investment, and risk discussions to help drive long-term growth. Effectively accomplishing this goal comes down to transparency and accountability. Specifically, boards and executive management teams have roles in preparing and providing oversight of regulatory reporting requirements.

Boards must remain educated on the evolving state and country regulations to help ensure alignment with sustainability goals – it is not just a compliance mindset, but also ‘living and breathing’ sustainability. Moreover, boards should assess the company’s readiness and strategic implications of global reporting regimes, including the Corporate Sustainability Reporting Directive (CSRD), the EU ‘Omnibus’ Package, and other regulatory developments.

5. Talent, Succession Planning, and Executive Compensation

Boards are discussing updates on management's approach to hybrid and remote work arrangements, aiming to maintain productivity and well-being among the workforce. Evolving workplace dynamics, including employee benefits, work-life balance, interesting work, recognition, and opportunities for advancement, are also being addressed. As dynamics evolve, companies are exploring strategies to upskill and reskill the workforce through training and development to meet the demands of the digital economy, AI, and emerging technologies. Further training on AI ethics, cybersecurity, risk management, and corporate ethics and compliance topics is also being mandated.

In addition, company compensation programs are under heightened scrutiny – notably, executive compensation. There is also an increased emphasis on succession planning for CEOs, CFOs, and executive management. Boards are preparing for executive leadership changes by developing plans.

6. The Activist Landscape

Boards and committees are under increased scrutiny. There is heightened attention from stakeholders on reviewing the board’s skills matrix, focusing on skills that contribute to achieving the company’s strategic plan. As noted above, there is also an activist spotlight on succession planning for board members, CEOs, CFOs, and other executive leaders.

As the activism landscape evolves, boards and executive management need to ensure preparedness through education and a response plan. It is important that directors and executive leaders are equipped to analyze investor stewardship programs and policies, as well as understand the shift in investor engagement with the expanded "active investor" definition under Schedule 13G.

7. Regulation and Policy Changes

Companies are proactively enhancing their readiness by assessing current practices, strategies, objectives, and disclosures to meet regulatory standards. Simultaneously, boards are holding director orientations on current and emerging regulations and their impact on the business strategy. A proactive approach also involves monitoring adjustments in regulations. Boards are focusing briefings on the U.S. Securities and Exchange Commission’s (SEC’s) agenda under its new Chairman, closely looking at the guidance on Schedule 13G reporting and Rule 14a-8 regarding shareholder proposals, executive compensation disclosure, and investor engagement communication.

8. Board Effectiveness

Board education and training are key to improving effectiveness. Companies are assessing their board’s skills in alignment with strategy, identifying and filling gaps, and considering upskilling programs for directors. They are also conducting rigorous reviews of board nominees and self-identified skills to ensure appropriate documentation and support for those listed in the skills matrix. Specifically, companies are ensuring knowledge around AI and emerging technologies, as well as robust financial planning and risk management knowledge, with heightened focus on navigating volatile markets, potential inflation, capital allocation, and business resilience. Companies may also consider adopting technology to enhance boardroom efficiencies and decision-making.

To receive exclusive corporate governance insights for board members and leaders, join the Nasdaq Center for Board Excellence.

The views and opinions expressed herein are the views and opinions of the authors and do not necessarily reflect those of Nasdaq, Inc.