From surviving to thriving has been saved
From surviving to thriving
How the Boardroom is changing for the better
Chairs from many of the UK’s largest public and private companies have shared a glimpse into their Boards’ experiences, and their own reflections, between April and October 2020. They have considered how their Boards would change in the future, as a result of their experiences throughout the initial months of the pandemic.
The immediate response: surviving disruption
All businesses felt some impact from the initial shock. For some, this has had significant implications for business performance, liquidity and viability, and has necessitated radical change to their business model.
Board adaptations: solving the paradox of greater responsibility with less contact
Some recent adaptations that Chairs are considering retaining, include:
- Striking the delicate balance between providing active oversight of operational decisions without obstructing executive action.
- Seeking the right balance between virtual and in-person Board connections.
- Acquiring greater insight regarding the interplay between the external environment, the business model, financial scenarios and the impact on the workforce.
- Evaluating which new governance mechanisms to strengthen and sustain. In companies which devolved decision-making to local management, governance mechanisms were adjusted in order to have effective oversight without getting in the way. Chairs now need to evaluate what to retain and what to flex.
- Engaging with major stakeholders before major management decisions were announced.
- Encouraging the Executive to maintain the great leadership and communication that many have demonstrated: managing the shocks to the business and workforce with decisiveness and empathy.
Looking forward: putting recent experiences to good use
Chairs are conscious that the experiences of the past year will shape their organisations’ thinking about future strategy. The experience has given Boards a better understanding of what the resilient organisation will look like.
Board attention is likely to increase focus on:
Purpose, strategy and reputation
- Strategy: to ensure the organisation can articulate a clear strategic vision, reviewed and flexed if necessary to take advantage of the new environment
- Purpose: as an authentic and consistent "North star" for the organisation and its stakeholders.
Stakeholder capitalism: to ensure companies understand and address the needs of all stakeholders
- Stakeholder engagement: to maintain two-way dialogue with all stakeholders, understanding the range and nuance of perspectives.
- Employee engagement: to take the pulse of employee views, concerns and aspirations
- Reputation: to ensure the business maintains its value to all stakeholders
- Remuneration: to navigate acceptable rewards and targets among likely stakeholder tensions
- ESG: to consider how the business could do better in all aspects of ESG, particularly accelerating climate and social justice, whilst maintaining high standards of traditional corporate governance to ensure capital is appropriately and sustainably deployed.
- Business transformation: to keep pace with ongoing external change
- Organisational agility: to ensure that governance supports increased agility and growth
- Operating model: to evaluate necessary changes and take the opportunity to be bold, if required
- Digital transformation: to understand the full implications of accelerating opportunities and threats of technology developments
Future of work
- Future of work: to ensure the management team rethink the optimum conditions for workforce wellbeing and productivity, and to challenge preconceptions about notions of workplace