Respond: Business-critical strategies for dealing with the crisis has been saved
Respond: Business-critical strategies for dealing with the crisis
A COVID-19 response for tax and legal leaders
This first article of Deloitte’s COVID-19 response series for tax and legal leaders tackles your most pressing challenges amidst the initial wave of the pandemic. As a tax or legal leader, we know that you have an instrumental role to play as you team with your organization to work through the disruption. In this initial article we highlight an important checklist of tax and legal-specific considerations for you to review as you adapt to the effects of the COVID-19 global crisis.
- Five priorities for tax leaders
- Five considerations for general counsel
- Enable the business
- Get in touch
As companies around the world struggle to come to terms with the health, social, and economic impacts of the COVID-19 pandemic, many tax and legal leaders are asking how they can best help their organizations adapt to this rapidly-changing environment.
There is still much work to be done. Many businesses are going through massive changes. Some are dealing with unprecedented demand and related supply chain issues; others are facing a reduction in activity and a renewed focus on cash preservation and business continuity. There are tax and legal implications at every turn.
This is the first piece in a series. We will highlight important considerations from the perspective of tax leaders and general counsel during the acute phase of the COVID-19 crisis.
Five priorities for tax leaders
The respond phase
Deloitte’s work supporting tax leaders has revealed five main areas of focus in response to the acute phase of the crisis.
First priorities for in-house counsel
The respond phase
The shelter-in-place and lockdown measures around the world have pushed many businesses into uncharted territory. As corporate executives assess the potential exposures to their companies, many of them are implementing immediate measures to mitigate the risk of revenue loss and to minimize non-essential expenses. At the same time, businesses must maintain employees and workspaces.
These complex dynamics present multiple, simultaneous challenges for corporate executives. Labor and employment, supply chain disruption, contract renegotiation and disputes arising as a result, health and safety concerns, data privacy, and mandatory disclosures are among the most important issues that in-house legal teams need to confront immediately.
General Counsel will play a critical role in the coming months. Corporate executives will continue to rely on their lawyers to contribute to and implement appropriate contingency plans. Their in-house counsel will be instrumental in identifying legal issues from all angles of their business challenges, many of which are without precedent. They will be vital to creating solutions that will mitigate legal risks that serve the corporation’s business goals—and to keep the corporation in business.
Five considerations for general counsel
Enable the business
Clearly there are many immediate actions tax and legal leaders need to be considering, together with near-term agenda items—IP arrangements, supply chain changes, strategic mergers and acquisitions, and the selling of non-core assets, to name a few. Additionally, tax leaders specifically need to study the recent raft of tax measures and identify ideas and strategies for cash generation and tax optimized business structuring, as well as thinking about how to continue meeting compliance and reporting deadlines during this time of disrupted operations.
Helping to bring these key priorities to the forefront is critical in this current economic environment. Tax and legal leaders must stay close to the business. They must be a part of discussions about short- term strategies and proactively work with leaders across the business to address their immediate needs.
Every organization has its own COVID-19 response model and governance, and there is no “one-size-fits all” solution. As businesses assemble teams to respond, there is a tremendous benefit gained by including tax and legal representation on all COVID-19 taskforces. Tax leaders and general counsel will bring valuable insights as businesses explore response strategies and scenario plans together. They will be vital to creating and implementing the solutions that will safeguard business goals and keep the organization from potential risks and mis-steps that could do long term damage.
While the complexities of the near-term may seem overwhelming at times, this phase will pass. As we move towards recovery, both new opportunities and new challenges will be created for the tax function and for general counsel.