Governance professionals provide evidence of how boards oversee M&A strategy, approach transactions and view risk
Levels of M&A activity have fluctuated wildly over the past few years against a background of market conditions influenced by factors such as the Covid-19 pandemic, economic and supply-chain upheavals, inflation, political uncertainty and Russia’s invasion of Ukraine. Amid such rapidly shifting and challenging conditions, boards must continue to fulfil their duties, including overseeing their company’s M&A strategies to ensure the best outcomes for investors and other stakeholders. Boards need to address various elements to help them be successful in this area, including assigning oversight, getting the right advice from outside the boardroom and taking risk into account.
In this special report, we present the results of a survey conducted among governance professionals such as general counsel, corporate secretaries and their teams. Their responses provide insight into how boards are going about their work across M&A, from strategy through to transactions and on to implementation. Respondents tell us about areas such as which elements of the board oversee M&A strategy, discussions with investors, boards’ views on risk, the time and technology devoted to due diligence, ESG considerations in target selection and the briefings boards receive.
Key findings
More than three quarters (77 percent) of all respondents say their main board has primary oversight of M&A strategy.
Forty-four percent of respondents in Europe report investors asking questions about a company’s M&A strategy frequently or always, compared with 21 percent of those in North America.
Overall, 21 percent of respondents say their board has become slightly or much more risk-averse over the past 12 months, while 15 percent say their board has become slightly or much less risk-averse.
Half of respondents say their board considers ESG factors as part of M&A strategy and target selection, while around a third (34 percent) say their board does not.
A quarter of respondents say the length of time spent on due diligence for M&A deals their company has been involved in has increased over the past 12 months.
Just over half (52 percent) of respondents report that their board is given briefings on M&A strategy on an ad hoc basis, while a quarter say their board is briefed at every meeting.
Survey demographicsThis report is based on the findings from an online survey conducted between December 2022 and March 2023. A total of 211 respondents took part.
Total number of respondents: 211
