How to train your directors
By Pritul Shah and Charlotte Thackrah
Multinational organisations face increasingly complicated cross-border laws and regulations. It is therefore vital that these organisations provide their directors with the support they need to understand their legal duties and responsibilities. Good training will make all the difference as directors attempt to navigate a safe path through the legal maze.
The potential for major problems here is considerable, with significant consequences for breaches of the law or regulation – for both organisations and directors themselves. A breach of directors’ duties leaves the organisation vulnerable to a civil or criminal claim from stakeholders such as shareholders and creditors. Individual directors may face sanctions up to and including terms of imprisonment. The scope for reputational damage is huge.
Why training matters and why it’s difficult
Anyone accepting a director’s role needs to understand these consequences – and take steps to minimise the chances of ever having to face them. Good-quality training for directors is a crucial part of that risk mitigation process. Training directors on their duties, roles and responsibilities will help them protect themselves and the organisation as a whole.
Unfortunately, delivering good training to directors can be difficult. There are practical problems: directors are short on time, and it may be difficult for organisations to arrange in-person sessions that everyone can attend. That’s particularly likely for organisations with a large number of subsidiary directors, who may be located all around the world.
Moreover, many directors say they do not find classroom-based training engaging or efficient. The quality of some training is patchy and lacks consistency from one jurisdiction to another. PwC clients have often told us that directors struggle to stay focused during the sessions arranged for them.
For the many organisations with large numbers of subsidiary directors appointed to legal entities that span multiple jurisdictions, this is a real headache. These directors badly need high-quality training but have often struggled to access it.
PwC’s approach to directors’ training
PwC has therefore designed a suite of digital directors’ duties modules that combine our technical insights with common scenarios and real-life issues. The goal is to equip directors to navigate the decision-making process so that they can protect themselves and their organisations.
Our research suggests that some forms of training for directors are more effective than others. Digital learning tools, for example, can work very well; directors retain 30% more of what they have learned, but training takes 10% less time than traditional methods.
Our Digital Director Training tool also allows directors to access training on the go, so they can learn whenever and wherever it is convenient to them. A built-in tracking and reporting tool makes it straightforward to monitor participation and results at a global level. Key features of the tool, developed using our cutting-edge learning platform Articulate Rise, include:
- content on the role of the board, directors’ statutory duties, reporting requirements and breaches, penalties and the protections available to directors;
- support for more than 100 different jurisdictions over time;
- the option to create bespoke subsidiary governance modules covering the specific expectations of subsidiary directors in your organisation.
Find out more
Regulators are increasingly focusing on the robustness of organisations’ corporate governance and compliance controls. This includes ensuring your directors understand their legal duties and responsibilities.
To find out more on how we can help you deliver online directors’ duties training, contact us now.
Contact us
Partner - Entity Governance & Compliance, PwC United Kingdom
Tel: +44 (0)7764 235240
