Covid-19, recession and related uncertainties paint a picture of an uncertain business and risk environment for the year ahead. Global volatility – driven by trade and geopolitical tensions, resurging debt, technology and business model disruption, elevated cyber risk and regulatory scrutiny – will add to the challenge. The pressure on employees, management, boards, and governance will be significant.
Along with the business, boards will continue to operate against a backdrop of tremendous uncertainty, an uneven economic recovery, and heightened stakeholder expectations – investors, employees, customers, suppliers and communities. Indeed, many boards are likely to see 2020/21 as an inflection point for corporate governance. This may include demands for greater attention to corporate purpose and stakeholder views, corporate culture and incentives, diversity and inclusion, the richness of boardroom dialogue and debate, and the company’s (and board’s) readiness for the risks and opportunities ahead – some of which may be backed up by investor votes against directors. Drawing on insights from our interactions with directors and business leaders, we highlight the ten focus areas for boards to keep in mind as they consider and carry out their 2021 agendas.
- Maintain a focus on management’s response to Covid-19, while keeping sight of the bigger picture
- Make human capital management and CEO succession a priority
- Re-evaluate the company’s focus on ESG and corporate purpose
- Reassess whether crisis readiness and resilience plans are effectively linked to the company’s key risks
- Approach cybersecurity and data privacy holistically as data governance
- Help set the tone and monitor the culture throughout the organization
- Build the talent in the boardroom around the company’s strategy and future needs
- Be proactive in engaging with shareholders
- Factor emerging and disruptive technologies into the boards thinking around strategy and risk
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