UK slow to grasp governance law

One in five IT directors claim to have seen no evidence of an increased focus on corporate governance in their companies, according to new research.

Scandals such as Enron and WorldCom have led to a greater emphasis on how companies are run. Legislation such as the Sarbanes-Oxley Act in the US introduced new regulations that will have a knock-on effect on IT and risk management.

But 21 per cent of IT managers claim not to have seen any more focus on governance, with 46 per cent reporting only a moderate increase.

The study was conducted on behalf of vnunet.com's sister publications IT Week and Financial Director, with supplier Unisys.

Some 70 per cent of the 200 IT directors surveyed indicated that a lack of time and resources were the major obstacles to increased corporate governance in IT management.

Nearly half of respondents also said that additional administrative strain is a deterrent, and 47 per cent blamed cultural resistance.

"It's possibly unrealistic, particularly in IT," said one respondent. "If there is too much control over IT, then people may be reluctant to attempt new ideas and new strategies."

But 45 per cent of IT managers have a 'very good understanding' of the impact of corporate governance, and 47 per cent said they had a 'good understanding'.

Some 19 per cent of IT managers indicated that the board would 'definitely' consult them about corporate governance, while 22 per cent said it was 'very likely'.

But managers supporting corporate governance believe it could be a boost for the IT department.

"There would be a greater understanding from the highest level. For example, an understanding of something more than the bottom line," said one respondent.

"People are motivated by interest shown in their function, which is particularly true for IT."

Ovum principal analyst David Bradshaw said: "This is not just about financial systems.

"It means your ERP system needs to work properly and has to integrate properly. It's not just financial data in your ERP system, we're talking personnel and so on."