Corporate governance year in review: 2024

Corporate governance year in review: a look back at the biggest events of 2024 that have shaped how boards carry out their duties. 

2024 has been a game-changer for corporate governance. It has been packed with seismic shifts that have transformed how businesses navigate mounting regulatory, societal, and technological demands. 

Crucially, the year has shown us how governance issues might evolve for the rest of the decade. We’ve seen how AI will eventually become a standard tool inside and outside boardrooms, political changes that might impact governance regulation, and stakeholders’ demands evolving alongside different societal expectations. 

Let’s dive into the biggest stories of this year and analyse why they’re such pivotal milestones.

In 2024, applicable companies had to start following the EU’s new sustainability reporting rulebook. Thousands of companies were tasked with changing their key communications, adding new ESG metrics and conforming to tighter standards, all before submitting their first official reports in 2025.

CSRD is a global milestone. Your company doesn’t even have to be European for the rules to apply to you; as long as you do a certain amount of turnover inside the bloc or are part of a supply chain connected to an EU-based company, you’ll likely face some kind of compliance. 

With such far-reaching rules, backed by the EU’s ambitious sustainability goals, it’s no wonder we’re putting CSRD at the top of the list. 

Why it’s important: Boards are under increased pressure to integrate sustainability into their strategies. They must also ensure they have the right talent to oversee sustainability reporting. This requires training, dedicated experience in ESG frameworks, and a focus on long-term stakeholder value.

With the rapid adoption of AI technologies across industries, 2024 saw the introduction of new AI-specific regulations in the EU and North America. These regulations are generally about removing the fear of AI, turning it from too powerful to understand to simply another system subject to the same accountability and ethical rules as everything else.  

Meanwhile, on the ground, the widespread adoption of AI continues inside and outside the boardroom. Often, though, what’s missing is a certain savviness about AI’s potential and where to draw the line regarding oversight and decision-making. Make no mistake: This issue isn’t going away.

Why AI development is essential: AI governance is no longer a niche concern but a fundamental aspect of corporate oversight. To maintain stakeholder trust and avoid legal risks, boards must now address the ethical implications of AI, mitigate biases, and ensure compliance with emerging laws.

When we say “hushing” in governance, we mean staying quiet or ambiguous on a key stakeholder issue out of fear of reprisals. 

In other words, companies think that voicing an opinion or target on an issue might attract criticism regardless. If we take ESG as an example, proponents could criticise the company for doing too little, and opponents could blame it for embracing ESG at all. 

So, ultimately, many companies think it’s best to stay quiet. 

The “hushing” trend originated in ESG and green policies. Still, we’re seeing it sprout in other areas like diversity, equity, and inclusion (DEI), particularly in the United States. DEI was dealt a major blow in 2023 when the Supreme Court ruled that university DEI admissions policies were unlawful. This ruling emboldened critics and allowed many companies to quietly drop DEI commitments from their PR, sometimes even from their entire strategies. 

Why it’s important: It shows that many companies find it harder to gauge stakeholder opinion on core issues and see increased risk. So, while it might have been low-risk to voice a partisan opinion in the past, many boards and executives now think it’s better to say nothing, even if their strategies around ESG and DEI remain the same.

That is likely the prevailing trend for the rest of the decade.

Aviation, particularly in the US, has had a bumpy road since the pandemic. Repeated scandals have exposed multiple governance failures, some of which were allowed to fester through the years without thorough questioning or oversight. 

The best example is Boeing. Once an untouchable aircraft manufacturing giant, the company has multiple headaches stemming from aircraft failures, crashes, strikes, plea deals seen as too soft and ultimately rejected by the courts, and whistleblowers complaining of poor safety culture.

Meanwhile, airlines have struggled, too—particularly budget providers like Southwest and Spirit. Both survived the pandemic only to find that their low-cost model was simply no longer working and have struggled to change their strategies. 

Why it’s important: It simultaneously shows multiple governance issues in one industry, most of which should teach other companies how to adapt to changing key trends.

In 2024, many countries, including the US, the UK, India, the EU, and many EU member states, went to the polls. 

The result showed a surge in far-right, anti-globalism views, especially in the US, where the incoming Trump administration has repeatedly opposed ESG and governance regulations. 

On the other side of the Atlantic, political power remains with parties that are more pro-ESG, pro-regulation, and open to more oversight. 

Whatever these viewpoints due to governance law in their jurisdiction, their contrasting nature might cause headaches for any company working cross-border.  

Why it’s important: The world is generally more divided and polarised, and boards need to navigate their companies through all of that. Whether it’s supply chain disruptions, trade barriers, global conflicts or law changes from new governments, there will always be something for directors to handle. Their job is to ensure they have the expertise to do it.