Even among smaller to mid-sized public companies, boards are getting more engaged on cyber-security, with nearly 60 percent of board members in a recent BDO USA survey saying they are more involved in the discussion now than even a year earlier.

Nearly three-fourths of the 75 board members in the survey said they are briefed on cyber-security at least once a year, and 25 percent said they are briefed quarterly. More than half said their companies had increased the investment in cyber-security in the past year, with the average increase in IT budget reaching 19 percent.

BDO conducted the survey of board members for companies in the revenue range of $250 million to $1 billion to gauge how those companies in that size range are viewing and coping with various issues and trends. Public company boards are not facing any specific regulatory requirement to take up an examination of cyber-security threats, but they are wise to pay closer attention, says Wendy Hambleton, partner in corporate governance at BDO USA.

“From a fiduciary perspective, considering best practices and corporate governance responsibilities, companies and boards need to understand at least where the risks and vulnerabilities are,” says Hambleton. “Practically every week someone else is coming out with a major cyber-security breach. There are a lot of factors around cyber-security that board members would want to know in terms of how this could affect the company, both the reputation aspects and the dollars and cents.”

Board members also reported through the survey that they are starting to hear from management how their companies might consider adopting a new standard on revenue recognition. Slightly more than half of board members said they have been briefed by management on the new standard, and 28 percent said the most difficult aspect of adopting the standard will be updating systems and policies. One-fourth said they expect some issues around revising existing revenue contracts with customers, and 17 percent expect to need to revise debt covenant agreements with financial institutions.

On the tax front, nearly 80 percent of public companies are sympathetic to their counterparts that are reincorporating overseas to avoid U.S. corporate tax rates, and a majority believe Congress should address the issue with legislation, according to the survey.

“The survey tells us there’s an issue,” says Hambleton. “Companies are saying Congress needs to look at it, but not just one aspect of it. They need to look holistically and not try to put a bandage on one piece.”

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