Saudi Arabia – Heidrick & Struggles (NASDAQ: HSII), a premier provider of executive search, leadership assessment and development services, today launched its third Board Monitor report in the Kingdom of Saudi Arabia (KSA). Despite regional and industry differences, there is a global consensus that the board's role is expanding, with higher stakes, more uncertainty, and increasing expectations. As these expectations grow, ensuring board diversity with the right balance of expertise, demographics, and widening of perspectives is crucial. In 2023, there was an increase in the proportion of seats going to board directors with prior CFO experience – double the figure from 2022. Meanwhile, there was a decrease in the proportion of board directors with previous CEO experience, with 42% in 2023 compared to 48% in 2022. First-time board members in the KSA accounted for 33% of appointments, while women represented 8%.

Additionally, the report reveals 8% of board appointments are non-national. Beyond demographic diversity, 33% of board appointments are individuals with cross-industry experience. These figures mark an opportunity for KSA boards to further enhance both demographic and experience representation in their board composition.

“Boards in the KSA must look at diversity holistically and strive to achieve the right balance of demographics and expertise, which includes gender, age, nationality, as well as industry and geographical experiences. This will require a continued focus and investment in improving board diversity – starting with a proactive and ongoing succession planning process. Boards would also do well to regularly examine director alignment and expertise with the evolving needs of the business, which will allow them to introduce directors with the required expertise or demographic to steer the organization forward,” said Maliha Jilani, Partner in Heidrick & Struggles’ Dubai office and Social Impact Practice lead in the Middle East and North Africa region.

The survey also revealed that boards in the Gulf Cooperation Council (GCC) region are more operationally involved on a frequent basis, compared to their global peers - 47% of respondents from the KSA and the United Arab Emirates (UAE) report increased overall board involvement happens frequently – almost double the global average of 25% and notably the highest out of the 20 markets surveyed by Heidrick & Struggles. While board involvement in day-to-day management has traditionally been more common for boards in the KSA and GCC compared to other regions, the survey highlighted a variation in board engagement. On one hand, some boards are overly involved in daily operations; on the other hand, others risk being too hands-off, missing strategic opportunities to add value. Also unique to the KSA is the challenge of over-boarding amid increased operational involvement, which can sometimes hinder directors from adding operational value.

“Boards in the KSA today navigate a fine balance between operational involvement and providing the right level of future-focused guidance. Directors must continually assess their level of involvement to better understand when and how they should step in to maintain a balanced and effective governance role. Having open, transparent conversations with the management to determine how involved the board should be is key, as is establishing robust frameworks for board involvement to ensure engagement and accountability. Boards themselves also need to focus on addressing over-boarding, so that directors with the relevant expertise can contribute meaningfully on forward-looking areas like growth and internationalization without being stretched across boards,” said Shaloo Kulkarni, Partner in Heidrick & Struggles’ Dubai office and Heidrick Consulting in APAC & EMEA.

Additional key findings from the Board Monitor Saudi Arabia 2024 include:

  • Globally and in the KSA, boards have significantly increased time spent on emerging technologies, including AI.
  • Saudi Arabia boards also spend more time in areas such as operational and other risks, geopolitical volatility, and sustainability than their global peers.

About Heidrick & Struggles 

Heidrick & Struggles (Nasdaq: HSII) is a premier provider of global leadership advisory and on-demand talent solutions, serving the senior-level talent and consulting needs of the world's top organizations. In our role as trusted leadership advisors, we partner with our clients to develop future-ready leaders and organizations, bringing together our services and offerings in executive search, diversity and inclusion, leadership assessment and development, organization and team acceleration, culture shaping and on-demand, independent talent solutions. Heidrick & Struggles pioneered the profession of executive search more than 70 years ago. Today, the firm provides integrated talent and human capital solutions to help our clients change the world, one leadership team at a time.® www.heidrick.com  

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