The Covid-19 pandemic crisis has already had a massive impact on every company all over the world. As an executive coach who has worked with CEOs from startups to Fortune 500 companies as well as with boards of directors, I’ve been helping my clients to adapt to this changing environment.
The role of boards has changed dramatically in this short time, and my conversations with directors have covered a lot of territory. I’ve seen a number of academic articles on the role of the board right now. I thought it would be enlightening to talk about this with a number of directors from diverse industries to get their view on how they view their leadership during this time.
I spoke to a number of board directors and advisors about the role of the board during this time and what suggestions they have for boards right now. Their answers are below.
Jill Griffin is the vice chair of Luby’s/Fuddruckers (director 17 years) a six-time author, including Earn Your Seat on a Corporate Board, and an expert in customer loyalty.
1. What is the role of the board during this current crisis? The number one duty of our board is both employee and customer safety. This is closely followed by number two – carefully monitoring our brands’ bottom lines so we do not run out of cash. (I heard a representative from the National Restaurant Association predict that 30% of America’s restaurants will close due to the pandemic disruption.)
2. What is one top suggestion you have for board members right now? This is the time for boards to listen carefully to their senior management, and looking for evidence that employees up and down the org chart have what they need to fill the customer’s “Value Bucket” everyday. When in doubt, err on the side of the customer. That is the surest path to ensuring shareholder value.
Sheila Stamps, an SEC-recognized financial expert, serves on the boards of Atlas Air Worldwide Holdings, Inc (Audit Chair); CIT Group, Inc and CIT Bank N. A.; and IES Abroad (a global educational services nonprofit).
1. What is the role of the board during this current crisis? The role of the board during this and any crises is to be available and up to date on the status of the issues. This is a time when the board needs to be available as a group or individually to provide advice and counsel based on their expertise and past experience. Board members also need to independently be up to date on key topics so that they can bring additional insight to management’s discussion of problems and potential solutions. Meetings and calls are more frequent, the need to focus on the safety of your people, the soundness of your business continuity, and the requirements of your customers are dynamic. Each of these things should remain in the forefront.
2. What is one top suggestion you have for board members right now? This crisis, like others, will proceed through a cycle. Management and the board need to know where they are in the cycle and what to prioritize. At the beginning of this cycle, the focus was, and is, on the safety of employees, business continuity, and customer service. As we move toward reopening and continuing the lessons learned from the defensive postures in the first phase, companies must address the requirements of rebuilding the existing business while preparing for how things might structurally change in the future.
Irene Chang Britt is an independent board member/chair on several public and private boards. She is the Chair of Nomination and Corporate Governance Committee on three public company boards: Dunkin’ Brands, Tailored Brands and Brighthouse Financial. She is also Chair of the Board for Amica Senior Lifestyles in Canada.
1. What is the role of the board during this current crisis? It is important for boards, during times of crisis, to govern with a balance of helpful skepticism and moral support. It takes skill to do that while maintaining a high level of mutual trust. By “helpful skepticism” I mean the tempering of management’s natural tendency to assure the board that they have everything under control. The directors are the ones who need to test for risk and the cracks in the plan. In doing so, especially in the tense environment of a crisis, that can be culturally challenging. That is why I also emphasize moral support, as one can often forget to say “thanks” and “how can I help” in situations fraught with angst.
2. What is one top suggestion you have for board members right now? Look to the horizon. It is tempting to use 100% of our energy on current issues, as they seem all consuming. But the board must always look externally and to the future, as well. We, of anyone in the room, have an obligation to steward the company for the long term. So, are we also asking, “how can we reimagine the future for this company while the current reality is being disrupted anyway”? As Winston Churchill aptly said, “Never let a good crisis go to waste.”
Roberta Sydney currently serves on the board of Tiedemann Advisors, a wealth advisory firm with $22 billion in assets under management across 10 offices in the U.S. and Europe.
1. What is the role of the board during this current crisis?
The role of the Board during this current crisis should be to ensure that management focuses on five key areas. First, on the employees and their health and safety. Second area of focus is financial, since cash is king. Third is communication strategy with employees, customers, vendors and the entire supply chain. Fourth is the business itself: is management evaluating the supply chain for broken or strained links? Are there short or long-term opportunities on which to capitalize? Fifth is strategy: how does this crisis change our long-term thinking? And, are there opportunities for pivoting that make sense?
2. What is one top suggestion you have for board members right now?
Know what message the company wants to communicate with employees, customers and shareholders and make sure that the board and management communicates that message clearly, consistently and calmly.
Cathey Lowe is an independent board director and audit chair. She currently serves on the board of the New Home Company, Inc. where she serves as the Chair of the Audit Committee. She is a Qualified Financial Expert with thirty years of experience in Fortune 500 companies.
1. What is the role of the board during this current crisis? The most important role the board can play today is be sure the company management doesn’t totally abandon strategic thinking. It’s so overwhelming now for the management group to be putting out fires, that it could make them slow to respond when the economic environment starts to improve.
2. What is one top suggestion you have for board members right now? My recommendation is to ask management to prepare three scenarios of strategic planning for the next three years: the best case scenario, the worst case scenario, and the expected case scenario. Preparing these three plans will help them make the decisions that will put them in the best position. If they run through the decisions that would have to be made for each scenario, they can easily see which decisions will maximize the expected outcome.
Dorlisa Flur is an independent board member and corporate advisor with more than thirty years of C-Suite operating experience. Currently she serves on the boards of Sally Beauty Holdings and Hibbett Sports. She is also among the first to earn the NACD’s Directorship Certification™ credential.
1. What is the role of the board during this current crisis? The board’s role is to stay abreast of the issues and offer management its judgment and perspective while empowering them to take the necessary short-term actions. Be their support network, not a demanding boss adding to the crisis work load. Be ready to jump in and provide extra arms and legs if they seek specific help. Most importantly, while management’s focus is down in the trenches, the board needs to be looking at the road ahead to anticipate the next risks and opportunities that will need to be tackled.
2. What is one top suggestion you have for board members right now? While the management team is dealing with the day-to-day crisis management, the board needs to be their second set of eyes looking out with binoculars to the next horizons. There will be both mid-term opportunities to meet customers’ changing needs and longer-term opportunities to capitalize on the pandemic’s second- and third-order effects on direct suppliers and competitors plus adjacent marketplaces. Envisioning what lies ahead provides context for making smarter short-term trade-offs and for resetting post-pandemic strategic priorities.
Amii Barnard-Bahn is a former Fortune Global 50 Executive, now a board advisor and executive coach for Fortune 500 companies. A leadership columnist for Compliance Week, she guest lectures at UC Berkeley on corporate governance and ethics and creating healthy workplace cultures.
1. What is the role of the board during this current crisis? The fastest cars need the best brakes. Boards have to make sure ethics don’t take a backseat to the P&L ramp-up. Heroes and zeroes are emerging daily in this crisis – boards can equip CEOs to be the hero that everyone wants to follow.
2. What is one top suggestion you have for board members right now: Ask the tough questions and demand the data. The stewardship, clear thinking, and insight that boards bring to the CEO has never been more critical. Act quickly – but don’t react. Some organizations are giving in to fear-based decision-making and messaging a push for profit at all costs – that can lead to brand damage, key talent departures, and regulatory enforcement.
Bobby Griffin is an Independent Director at Atlas Air Worldwide Holdings, Inc., an Independent Director at WESCO International, Inc., a Lead Independent Director at United Rentals, Inc. and an Independent Director at Hanesbrands, Inc.
1. What is the role of the board during this current crisis? Make sure the company is solvent, make sure it can operate, but in addition to that make sure that we are looking at the health of our employees and our customers as well as the business. We also have to look at our relationships with our employees and our customers to make sure they are healthy as well.
2. What is one top suggestion you have for board members right now? These are times when the world is changing. We have to make sure that we don’t go back to business as usual when the world comes back together. The suggestion I have for all of us is to make sure we keep an open mind and to be a lot more creative. I am always interested in the people side; I want to make sure that we don’t just look at the shareholder but also the people that have helped our company grow. Board members need to be mindful of that as we make decisions. There are difficult decisions we need to make, hard financial decisions, but we as a board need to make sure management weighs our responsibility to our people as we go through this.