The 2026 Governance Agenda: Priorities for Directors

As boards move from planning into execution for the year ahead, they are confronting higher expectations on performance, digital capability and regulatory compliance than ever before. The past three years have shown real gains, but compliance’s rising costs and complexity now demand a stronger, more consistent foundation.

OnBoard’s fifth annual Board Effectiveness Survey Report (the Report) gathered input from more than 500 board professionals globally, including directors and members, board administrators, CEOs and presidents, Executive Directors, Corporate Secretaries and General Counsels. We included organisations across many sectors, including not-for-profits, education, financial services, associations, healthcare, corporate and government.

For many boards, March is the point where strategic intentions meet operational reality. Early board cycles reveal whether systems, workflows and capabilities are actually supporting effective governance, or quietly adding friction.

The new governance baseline for 2026

Good governance relies on good information, and the good news is that the Report is packed with data and insights that will help you – and your board – make informed decisions, backed by an understanding of the historical context.

The headline findings are that, from 2023 to 2025, boards remained steady in their performance, are more collaborative and more confident in their security.

That’s not to say that progress has been a steadily upward march; looking at the year-by-year figures shows how boards have evolved:

• 2023: Ineffective members, poor tech use, limited resources.
• 2024: Collaboration improved, but security confidence dropped.
• 2025: Effectiveness, collaboration and security confidence rebounded.

When we look at the various ‘pain points’ affecting boards, we see evidence from our report and various other publications that the familiar factors of regulatory and compliance pressures, technology-related risks and disruptions, productivity and cost pressures, and rising shareholder expectations are all in play.

Regulatory and compliance load

The Report found that 78 per cent of respondents felt their boards were ‘effective’ at governance and continuity, with 15 per cent ‘neutral’ and just 7 per cent ‘ineffective’.

These are encouraging numbers, especially given the rising cost and complexity of compliance. The AICD, as recently as November 2025, in its report $160 billion and counting: The cost of Commonwealth regulatory complexity, states that ‘The total cost of meeting Commonwealth regulation has grown from $65 billion (4.2 per cent of GDP) in 2013 to $160 billion (5.8 per cent of GDP) in 2024’.

We now rank second in the G7 (behind Japan) for administrative and regulatory burden, and boards now spend more than twice as much time on compliance (55 per cent) as they did a decade ago (24 per cent).

Boards face more reporting, more legal reviews and more time spent on compliance oversight. There is more legislation (which is also more complex), external legal spend is up, compliance roles are growing in number and salary, and it’s clear that Australia needs a ‘better regulation’ agenda to reduce costs and simplify compliance.

In the meantime, boards must make the most of their resources by streamlining processes and developing intelligent workflows.

Technology, cyber and AI disruption

Cyber risk remains a top concern for Australian boards. AI’s emergence as a potentially transformative technology has only added to the complexity of governance and risk management, as boards must understand how it might change their organisation.

Directors, managers and other employees are using AI in the workplace. More than two-thirds (69 per cent) of our 2025 Survey respondents reported using AI for board work in the previous six months, and 40 per cent reported using more than one AI application.

Looking at our data, we see that AI users rated their boards as more effective than non-AI users (75 per cent vs 63 per cent), with similar findings for collaboration (73 per cent vs 65 per cent) and security confidence (67 per cent vs 49 per cent). Boards (and their organisations more broadly) must ensure they’re using AI responsibly and securely.

In its report On the 2025 Board Agenda, KPMG identified eight key challenges facing boardrooms. The report ranked ‘AI strategy and governance’ at #2, ‘Data governance and cyber security’ at #3 and ‘Risk oversight responsibilities’ at #7.

Technology-related challenges aren’t going away, and stakeholders reasonably expect Directors to understand digital risk, AI, data governance and emerging technologies.

The nub of the challenge is for boards to balance innovation with safe, secure digital practices. The Federal Government has created a new body, the Australian Artificial Intelligence Safety Institute (AISI), to ‘provide trusted, expert capability to monitor, test and share information on emerging AI technologies, risk and harms’.

This body is a significant step forward, and we encourage all boards to take advantage of the AISI’s reports and information releases when it becomes operational in early 2026.

In the meantime, boards must ensure their knowledge remains up to date, their risk registers are current, and their risk and security teams are well-resourced, responsive, and in regular contact with the board.

Productivity and cost pressures

Pressures on organisations to be more productive and contain costs are nothing new. However, the availability of digital tools – including, but not limited to, AI – provides a new opportunity to understand and manage these concerns. These tools can help boards to understand bottlenecks, streamline workflows and make better, more cost-effective use of limited resources.

Broader industry sentiment reflects similar concerns. The AICD’s Director Sentiment Index Survey for the second half of 2025 identified ‘Productivity growth’ (42 per cent), ‘Global economic uncertainty’ (39 per cent) and ‘Regulation requirements/red tape’ (35 per cent) as ‘the top three economic challenges facing Australian businesses’.

Simply put, productivity drag is a significant risk heading into 2026, as organisations face tight budgets while the compliance workload continues to grow.

To reduce productivity drag and better use available resources, boards need clearer workflows, stronger systems, and more efficient decision-support tools.

Rising stakeholder expectations

In addition to compliance, technology and productivity concerns, expectations around climate disclosure, culture, workforce wellbeing and diversity continue to rise. We note that none of these should be seen as negatives, or outside the board’s remit or purposes.

Rather, they are responses to a more engaged and better-utilised workforce, and a better-informed public. Organisations must demonstrate that they reflect their stakeholders’ values if they wish to remain relevant to them. To this end, our Report’s respondents ranked ‘More engaged board’ (52 per cent) as the number one factor in improving board success. In a similar vein, respondents ranked ‘Improved strategic planning’ (42 per cent) and ‘Addition of new board members’ (40 per cent) fourth and fifth, respectively.

There was also awareness of the increased scrutiny boards are under, particularly regarding their effectiveness. The Survey notes that ‘Boards overwhelmingly see people-related issues as their greatest vulnerabilities … far outweighing structural or technology-based challenges … [board effectiveness] depends less on formal structures and more on the commitment, contribution, and readiness of its individual members’.

To that end, boards must navigate more scrutiny, higher transparency and broader accountability obligations.

Governance is the answer

These added pressures expose ‘gaps’ in boards’ operations. When asked about their causes, responses included ‘Low engagement from board members’ (30 per cent), ‘Limited communication between meetings’ (24 per cent) and ‘Inconsistent board member preparedness’ (24 per cent). These gaps tend to surface early in the year, when meeting cadence increases and reporting and compliance demands accelerate.

Closing these gaps is critical, setting a higher governance baseline for 2026 and making stronger systems and smarter workflows essential. As we will see below, digital tools and governance platforms can play a key role in easing these pressures and improving overall board (and, by extension, organisational) performance. But as with any tool, these platforms can only be as effective as those using them, which is where directors must again play a key role.

Digital competency as a core skill

Broadly speaking, digital tool use remains one of the weakest areas of board practice. We believe that digital competence is a non-negotiable skill for modern directors. Simply put, we live in a digital world, and directors need digital skills to perform their roles effectively.

Tellingly, the Corporate Governance Institute’s article ‘Most important boardroom skills 2025′ lists ‘Digital literacy and competence’ as the number-one skill needed in the boardroom, and provides a compelling account of why this is so:

The increasing adoption of artificial intelligence (AI) and digital tools requires technological literacy among board members. Understanding AI’s capabilities and risks is critical for making informed decisions.

Moreover, it’s equally important for directors to understand how AI can help in the boardroom itself, including all the new opportunities and decision [sic] about what AI should and shouldn’t help with.

Boards that lack these insights may face challenges in assessing AI ethics, cybersecurity risks, and regulatory compliance, which are becoming central to corporate governance.

Beyond overseeing AI initiatives, board members must also grasp data analytics and digital transformation strategies. As businesses rely more on big data and predictive technologies, directors must evaluate digital investments and integrate tech-driven insights into corporate strategy. Staying ahead in digital literacy ensures boards can lead digital innovation while safeguarding stakeholder trust.

Looking across the digital landscape, we have identified four key areas where directors need enough understanding to ask and understand the answers to meaningful questions about their organisations’ digital capabilities:

• digital reporting systems
• risk oversight technologies
• AI-assisted analysis
• cybersecurity governance.

Yet acquiring these skills need not be an onerous task, as many resources are available to assist. For example, the recent ‘ASD and AICD guidance on board cyber priorities for 25/26′ includes ‘threshold questions in four priority areas … [assisting] a board to ask informed questions of management about how the organisation is addressing key cyber controls, given current and emerging threats’. The ASD/AICD’s priority areas in this case are: event logging and threat detection; managing legacy IT assets; cyber supply chain controls; and preparation for a post-quantum cryptography environment.

At the board level, the actions required are simple in principle: skills mapping, targeted training, AI-supported preparation, improved onboarding and clearer expectations on digital engagement.

Director readiness checklist for 2026

With the above in mind, what are some practical actions a board can take now, as early-year priorities crystallise and 2026 expectations come into sharper focus? Here is a list of simple suggestions to kick-start your preparations:

• Review digital and compliance capability across the board
• Refresh your skills matrix to reflect new regulatory and tech expectations
• Update your governance tech stack
• Audit compliance and reporting workflows
• Tighten cyber and data security oversight
• Set principles for AI use in board work
• Reshape meeting packs and calendars for 2026 regulatory deadlines
• Clarify preparation expectations and director accountability

These actions reflect a broader shift in governance expectations across the region. Further analysis of these changes is explored in Navigating Climate, AI and Boardroom Change in Australia and New Zealand, which examines emerging expectations and the growing importance of modern board information management.