Although banking platforms have been upgrading their legacy technology stacks and making substantial investments into their digital transformation strategies, their boards of directors still don’t have the tech-related expertise needed to effectively manage modern financial institutions.
A report from Accenture reveals that only 10% of board directors and just 10% of CEOs are proficient in using technology. Accenture’s report is based on an extensive analysis of the professional backgrounds of around 2,000 directors of over 100 of the largest banking institutions (globally).
As noted in the report, the number of banks with at least one board member with the right professional tech experience has increased by just 10% during the last 5 years (from 57% to 67%). This means that one-third or over 30% of banks do not have a technology-proficient member sitting on their boards.
Mauro Macchi, who’s focused on Accenture Strategy and Consulting in Europe, stated:
“Much of the disruption brought about by the pandemic has led to a rapid shift within banking to more digital touchpoints, requiring speedy technology investments. Banks that are accelerating their Cloud adoption to better manage change would benefit from a board with technology experience that can help ensure that technology investments are compatible across various business units.”
The Accenture report also revealed that banks in the UK, Finland, Ireland and the United States have significantly higher percentages of board directors with the appropriate tech background when compared to directors from Austria, Brazil, China, Italy, and Russia.
Macchi added:
“While it’s not practical for banks to make a rash number of tech-savvy board appointments to fill the gap in technology credentials, they should consider technology expertise as a factor for new appointments, alongside their other evaluation criteria.”
Macchi further noted that “there are also other, more immediate ways to increase technology expertise among board members — for example, coach members on the latest developments on key technologies such as Cloud, artificial intelligence and the internet of things to better understand how the combination of technology and human ingenuity unlocks value.”
He suggested that boards “can also tap into the expertise of third-party suppliers and make time to specifically discuss the technology strategy during board meetings to get the most out of their investments.”