The role of the board member in crisis management

You serve on the board of many of the stock market's heavyweights and take great responsibility in the business world. What are your thoughts on the challenges facing our economy today?

The challenges should not be underestimated, as the repercussions of the pandemic touch deeper and wider than previous crises. We are moving across a broader spectrum ranging from human and social suffering to a recession with geopolitical complications and lasting behavioral changes. All uncertainty is uncomfortable, but trends and ongoing structural changes, many with positive undertones, will accelerate once the most acute phase subsides. My sense is that individuals and businesses have stepped forward, taking initiative and responsibility where the public sector has been slow to act. This gives us optimism for the future.

As a board professional, have you experienced previous periods where so many companies and industries need to change?

Probably not! That being said, it is probably wise to wait for the final diagnosis. We have experienced other events that were perceived as extremely disastrous in the eye of the storm but which, with the benefit of hindsight and a few years' distance, did not result in any long-term disaster. Changing behavioral and consumption patterns in symbiosis with technology as a catalyst and enabler, was a strong driver of structural change in many industries even before the pandemic.

Building teamwork and culture in boardroom, in tandem with management brings returns when crisis comes

We do not know when we will reach the end of this pandemic, although it feels like things have already turned around in several businesses. How is strategic board work conducted when you have a generally uncertain forecast?

There is no simple, one-size-fits-all answer to this question, nor to the question of board work in general. We need to tailor the agenda and approach to each company's circumstances and maturity. A general answer is to build a focus on the outside world, flexibility and speed into the culture. Practicing scenarios can be helpful and often provides unexpected insights that contribute to speed when the winds change. The role of the board is often about stretching the time perspective, having the courage to take risks and looking beyond an internal focus.

Would you say that the board's task of managing the CEO's role has changed in times of crisis?

Good teamwork, with the board and management working towards the same goal but with different roles, is a recipe for success in both good and bad times. We play on the same team! The investment made in building teamwork and culture in the board group, in tandem with management, pays off when the crisis comes. If that investment was not made up front when there was time, all stakeholders, including shareholders, may pay a heavy price.

The board should allow the executive management to speak

What is the best way to support CEOs and management in times of crisis? 

A couple of components involve more frequent contact, more frequent check-in meetings and offering board members' experience in dealing with adversity. Asking the right questions, raising perspective with a mix of concern and confidence. Create calm.

What kind of crisis management is expected of you as a board member? 

This varies from companies where the board member is normally close to the operational business, to more mature and well-staffed organizations. For my part, it is striking how much faster and smoother the crisis management this spring has worked in companies where we have dry-run and previously conducted crisis exercises - even at board level. What we and the management practiced looked different, but practice gives skill, calm and confidence. Another aspect of the board role is to maintain the helicopter perspective and ensure that management does not get caught up in crisis management and exclusively internal processes. After a while, crisis management becomes normality and it is important to distribute focus on several tracks where employees and customers are looking for direction, meaning and a way forward. This is where the CEO must step up and demonstrate his leadership skills. This is not always easy, but a board can help make it happen.

Communication, communication, communication - two-way!

In what types of crises and stages do you think the Board need to make a statement?

While there are no exceptions to the rule, the board should allow the executive management to speak, except in the case of clear-cut board decisions, such as the transfer of capital to shareholders, management remuneration or CEO changes. One item on the checklist in crisis management plans is who will take the place of the CEO in case of absence - for example, in case of illness, which has become a non-negligible risk in the context of the pandemic. Since we have had a meeting season where the chairman of the board has an active role, it has also been relevant to have a clear replacement identified if the chairman is not available.

How do you think leaders build trust with both their board and their employees? 

Communication, communication, communication - two-way! Visibility and honesty. Even when you have nothing new to say - say just that. An encouraging observation is that many employees feel closer to their leaders during the crisis. Digital staff meetings have been equal for all and are reducing the feeling of exclusion. I have also heard several CEOs empowered by receiving feedback from the wider teams. Creative solutions, new ways forward and generally wise advice are hiding deep in the capillaries and have now been fast-tracked directly to the decision-makers!