Staying ahead of the next normal

Operating the board during the crisis
The current crisis sheds light on the vital importance of a diverse board. A group with a breadth of experience, relevant industry, and functional expertise, and a range of ages, genders, and backgrounds enables an organization to assess challenges from a variety of perspectives. Here is how a board can effectively play its role.
Reconfirm the board’s role and accountabilities
A clear division of roles and mandates between board and management is paramount to make collaboration seamless and avoid the distraction of unnecessary conflicts. While the level of stress and pressure every individual is facing during the current crisis can be draining, a board needs to remain calm and focused. Some decisions that take years of alignment in normal times may have to be passed in a matter of hours. All this will be difficult unless boards and management teams embrace seamless teamwork, trust, and mutual support. During this time, boards should make explicit that they are fully behind the management teams as they make some of the most difficult decisions of their careers.
Adapt the board’s operating model to the crisis
During a crisis, a board has no choice but to adapt its working mode to the speed of events, requiring directors to invest significantly more time than normal and relax the annual agenda. Ongoing communication between boards and management teams is necessary for quick action on contingency planning, public announcements, strategy development, and other urgent matters. An ad hoc board-level crisis committee can help directors engage regularly with the crisis leader who reports to the CEO. While some of the board’s heightened responsibilities—such as more frequent risk or policy reviews, financial-stability assessments, and governance-structure changes—can be absorbed by standing committees (including those for audit, risk, nomination and governance, and compensation), assessing the crisis’s strategic implications and the organization’s future direction needs to be handled jointly by the entire board, with collective accountability and frequent interaction.