As boards evolve to take on more functions, their assistance with communications in times of crisis can help to ease the pressure on management


By Vivian Lines

Covid-19 has brought into sharp relief the expanded role that boards of directors can take to support management and add value to the organization in difficult times. Communication with stakeholders is one way in which boards can augment the work of management.

A McKinsey article looking at the role of boards during and beyond the pandemic, notes: “A board can ease the pressure on the management team by reviewing communication plans and reputation management challenges and engaging with select external stakeholders.” More extensive communication to investors, governments and regulators are areas where an effective board can add value.

Helping management with operational communications is not a traditional function of the board. Strategic planning, oversight of major transactions, and CEO succession planning are often regarded as the value-creating activities of boards, while financial statement review, compliance and audit-related activities are critical but considered less strategic.

However, these are not normal times and Covid-19 is creating new normals for companies every day even as they emerge from lockdowns. If board members can help relieve some of the pressures for management, bring relevant experience from their own backgrounds to bear on the problems, and help develop strategic thinking beyond the crisis and in readiness for business resumption and the issues that may arise, then there shouldn’t be any concern of potential board overreach.

As Russel Reynolds Associates notes in a paper on Board Leadership and Performance in a Crisis, “Boards that act fast to reinforce a strong, compassionate, and positive culture with both internal and external stakeholders stand to benefit the most post-crisis.”

Evolving role

Boards have evolved over the past decade either as a result of new stock exchange rules, changing company needs, or changing societal expectations.

A Heidrick & Struggles survey published in March looked at the “European Board of the Future” and notes how the role of the board is changing, with new areas of involvement including “issues that once might have been the purview of management alone, such as reputation and sustainability, and others that are emerging as central to performance, such as establishing and maintaining purpose.”

Boards could rely on a company’s chief communications officer to bring this expertise or turn to external consultants for advice. But to fully integrate this learning into board thinking and practice companies will need independent not executive directors on their boards with those skills in depth.

From a communications perspective I would offer the following suggestions to board members taking on this expanded role of communicating with stakeholders:

Ensure messaging is consistent. In this instance the board is working alongside management so a strong alignment on messaging will be important, while ensuring the board is not perceived to be functioning as management.

Think how the message will be received or heard. Consider how you would feel if you were on the receiving side. Are there ways of saying it better in order to connect more effectively with stakeholders?

Bad news deserves to be told straight. I am a strong believer in not sugar-coating bad news, however, your stakeholders will also want to be shown a way forward. Future-focused messaging is increasingly important as businesses move into the recovery phase of the crisis and what comes next.

Demonstrate empathy not just facts. Particularly in times of crisis, emotional leadership is more important than intellectual leadership.

Make use of your network. You are probably on the board because of the skills and connections you have as well as your ability to work closely as part of a team. Now is the time to use those connections to help the company as it navigates the crisis.

Corporate reputation matters as much as profits. Research shows that the reputation of the company and how it manages the crisis impacts its ability to recover well.

Will the board’s involvement in communications and corporate reputation disappear along with Covid-19? Regardless of the continuing risk of “Black Swan” crises, I don’t think the board’s involvement in these areas will decline or that it should.

Asian companies should also take note, particularly with geopolitical frictions threatening to undermine their license to operate in some overseas markets. Now is the time to be enhancing communication and corporate reputation skills at a board level.

As Heidrick & Struggles notes in its Board Monitor Hong Kong, nominating committees “might consider executives in traditionally untapped functional areas,” and they point to PR, communications and marketing among others.

The expanded roles that boards have taken on globally with communications and corporate reputation reinforce that this should happen sooner rather than later, as the board of the future is being defined today.

Vivian Lines sits on a number of advisory boards and is a consultant on effective stakeholder engagement to companies and organizations across Asia. He can be reached at vivian.lines@linesconsulting.asia

(In the event of any conflict between the English and Chinese versions of this blog, the English version should be the reference.)

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