For many boards, helping their companies navigate a crisis is nothing new. They have faced cyberattacks, natural disasters, #MeToo incidents—the list goes on.
But the novel coronavirus COVID-19 pandemic differs from “crisis as usual” in many ways. The situation is global in scope with repercussions that are far-reaching and multifaceted. COVID-19 has already disrupted financial markets worldwide, paralyzed the movement of people and goods, brought about curfews and country-wide lockdowns, canceled sports seasons, and restricted cross-border movements and flights. It’s dominating both private discourse and public policy, and the virus continues to spread. COVID-19 is a different kind of crisis.
Yet, as with any watershed event, this pandemic also presents an opportunity for board members and executives to assume their leadership roles and build trust. In a recent interview, we tapped Betsy Atkins, who has served on dozens of corporate boards over the course of her career, for her leadership guidance in this unique situation:
“A crisis response is the operationalization of your culture in real time. Do you take care of your employees? Do you take care of your customers? It is the chance to define your company.”
– Betsy Atkins, founder of Baja Corporation, three-time CEO, and board member for Wynn Resorts, SL Green and Volvo
Below are tips to help executives and board members excel – both as leaders, and as fellow human beings – during this defining moment.
1. Consider Business Impact from All AnglesFrom sales to supply chain to employee sick leave, COVID-19 is impacting every aspect of business operations. A board’s role is to help management understand how these factors interrelate so the company can respond most effectively.
In a recent interview of The Corporate Director Podcast, Peter Deans, Director of Notwithoutrisk Consulting in Australia, explained that “employee safety and business impact are the immediate priorities.”
Deans recommends asking your finance team to model a range of scenarios so the board and executives can quickly and easily see potential financial ramifications. He also suggests “stress testing” the balance sheet and P&L statement.
Among the other COVID-19 considerations: supply chains and sourcing, delivery of goods and services, cash flow and liquidity, and availability of debt and equity financing.
Betsy Atkins advises leadership teams to develop a dashboard with specific COVID-19 topics or risk areas that the leadership team is monitoring.
2. Address Each Stakeholder GroupIn times of crisis, employees need reassurance about their jobs. Customers crave certainty about the safety of goods and services. Suppliers want to know when (or if) they’ll get paid—and the prospect for future orders. And investors, of course, are closely monitoring financial indicators like stock price.
It’s important that boards and management teams have a finger on the pulse of each stakeholder group—and that they tailor the message based on the needs of each. Because the COVID-19 situation changes constantly, organization must also monitor how stakeholder sentiment is evolving. Consider how your organization can gauge the “health” of conversations within each stakeholder group.
3. Over-CommunicateWhen every email and article seems to lead with “coronavirus,” it’s easy to feel like you’re just contributing to the noise. Company leaders must resist this temptation.
“Your customers, employees, and investors want to feel and see that you care about them,” says Atkins. “It’s a time to overcommunicate to all your stakeholders and manage through transparency and clarity.”
The board’s role is to make COVID-19 response a standing agenda item—and to safeguard open, clear, effective lines of communication between directors and management. This enables both collaboration and flexibility as events unfold. Recommendations from the National Association of Corporate Directors (NACD) include:
Ensure company leaders have access to reputable, relevant information sources; ensure the right teams and plans are in place for decision-making and responseEstablish protocols about who communicates what, and through which channels. For example, create internal communications for maintaining workforce culture and productivity; bolster investor relations for business continuity, risk, and operational impactBalance the need for transparency with the avoidance of litigation riskAcross tactics and stakeholders, one goal is constant: communicate in a way that shows empathy and leadership.
4. Act Swiftly, Effectively and EmpatheticallyIn a situation as critical, complex, and rapidly changing as COVID-19, it’s easy to feel challenged about determining the right path forward.
Fortunately, boards and executives may be more prepared than they think. A crisis response plan may already be in place for a cyber breach, natural disaster, or workplace accident. Additionally, a plethora of COVID-19 resources are available from reputable sources, including The Conference Board, Harvard Business Review, and NACD, not to mention the Centers for Disease Control and Prevention and the World Health Organization.
As the pandemic continues to unfold, the most important priority is keeping the situation on the front burner, and leading in a timely, thoughtful, and empathetic fashion. In the words of Betsy Atkins: “How you behave in a crisis is what people will remember.”