Dear CII Community Members,

I’d like to share with you the results of PwC’s Investor Survey on Governance, which includes the input of many of you. In the aggregate, survey respondents manage over $11.5 trillion in assets.

There were 3 key findings:

· Risk remains a big topic of concern for investors, and they aren’t happy with the information available to them about a number of risk topics. 59%, for example, are dissatisfied with information companies provide on cyber risks. Most striking, almost 40% of investors don’t think that boards really understand emerging risks that can affect the company.

· Nine in 10 investors believe that boards should be revisiting their director diversity policies, and 85% believe that doing so will require addressing underlying impediments that currently inhibit increased diversity. This will, in most investors’ view, require boards to approach diversity with greater openness and commitment. Only 3% of investors think the lack of diversity is the result of insufficient numbers of qualified diverse candidates; most investors instead place the blame at board and/or leadership unwillingness. Investors want boards to regularly revisit certain board policies. 94% of investors responding to our survey say boards should revisit their policies about majority voting, board diversity, and the number of boards on which directors may sit.

· While investors are satisfied with how boards are doing their jobs in a number of areas, there is room for improvement. For example, over 60% of investors are dissatisfied with how boards assess director performance. About 65-70% of our respondents think there are cultural impediments to replacing underperforming directors (i.e., a close relationship between the CEO and the underperforming director or board leadership that is uncomfortable addressing the issue). Nearly 60% think the absence of certain policies or procedures (e.g., no effective assessment of individual director performance, no annual elections) is to blame.

As the work of PwC’s Investor Resource Institute advances, we will continue to seek your input and share results with the investment community, corporate officials and regulators.

Best regards,

Kayla J. Gillan

Leader, PwC’s Investor Resource institute

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