One in three U.S. board members and executives are “very concerned” that the climate of uncertainty and volatility may pose a significant threat to their corporate strategy, and more than three in four worry that management tends to use outdated assumptions in setting strategy, according to a survey by the Board Leadership Center of KPMG LLP, the audit, tax and advisory firm.

KPMG’s latest Roundtable Series gathered over 1,200 corporate directors and senior executives across 17 cities to share their views on the board’s role in calibrating strategy. 32% of those surveyed said they are “very concerned” that management tends to use “more of the same” assumptions regarding key factors and uncertainties in setting strategy, and another 46% said they are “somewhat concerned.”

Survey respondents ranked economic uncertainty (61%), technology and innovation (58%), and government regulation (57%) as having the most significant impact on the company’s strategy or the assumptions underlying it. Read the full report here.

“Amid this unprecedented mix of volatility and uncertainty, boards will need to closely monitor changes in the business landscape to understand the impact on the company’s strategy and risk profile, and help the company recalibrate as needed,” said Dennis T. Whalen, leader of the KPMG Board Leadership Center. “We’re clearly seeing a shift in the board’s role in strategy away from an ‘annual review and concur with periodic involvement’ toward an ongoing dialogue with management.”

40% of those polled said that management does not create probability scenarios that focus on the critical assumptions at the core of the company’s strategy, and only 37% said they are “satisfied” that management has an effective process to scan and monitor changes in the external environment regularly in order to test the continuing validity of strategy assumptions.

Heightened Focus on Risk

The survey results show that boards are taking steps to better link risk and strategy in boardroom discussions. Some 63% of those polled reported that their board is devoting more time to discussion of strategic risks, uncertainties and opportunities. Other actions reported include improving information flow to the board regarding strategic risks, uncertainties, and opportunities (58%); reviewing/approving risk appetite (40%); and hearing more third-party views (28%). In addition, 65% said their board has discussed its composition and succession planning based on the skill sets that will be most relevant to the company’s strategy in three to five years, and another 15% plan to do so.

Roundtable discussions highlighted the board’s evolving role in evaluating strategy options and challenging fundamental assumptions, monitoring execution and engaging with management on an ongoing basis, and helping to connect strategy, risk, and long-term value creation.