Navigating future business challenges

A look ahead to the future business challenges set to make headlines in 2015

Businesses faced a particularly difficult year in 2014 with major banks falling foul of the regulators due to trading and system failures; retail giants dealing with financial holes; and implementation of new remuneration and bonus clawback rules.

It seems this trend of heavy regulation, implementing new rules and regulations and closer scrutiny – by regulators, media and the public – is set to continue throughout 2015.

Governance + Compliance approached a number of industry professionals for their opinions on the most significant issues that companies will likely be tackling in 2015. The challenges associated with strategic reporting are likely to remain high on the agenda. A particular issue is the new requirement of putting together a viability statement within the strategic report, as part of changes to the Corporate Governance Code made by the FRC.

Sector scrutiny

Delving further into sector and company specifics, we asked the industry experts which sectors in particular they thought would face difficulties in the next 12 months.

GoodCorporation’s Director of Business Ethics Advisers Leo Martin also commented on the increased pressures to be felt by the banking sector: ‘[this] sector is … going to bear the brunt of the challenge on directors’ pay from the updated UK Corporate Governance Code. The new Banking Standards Review Council will also push banks to make sure that they are measuring more convincingly their ethical culture and leadership.’

Public Trust

Satisfying public opinion about good governance will continue to be as important as meeting regulations. Maintaining public trust is identified by several experts as a challenge for 2015. Public expectations, emerging risks and tightening regulations will likely mean that governance issues continue to hit headlines in 2015. The key question will be how successfully businesses manage to navigate these challenges?