Challenges boards face during pandemic recovery
NACD’s Advisory Councils recently met with Fortune 500 committee chairs in the audit, compensation, governance, risk oversight, and lead director groups to reflect on the past year’s events and the new shifts brought on by a new presidential administration. Through the discussions, four key themes emerged as confronting boards in the recovery from the pandemic.
Below we share a summary of these challenges and invite you to read the full article by NACD.
1. Talent, Workforce, and Culture
Boards are turning their attention to the new human capital dynamics brought forth by the pandemic, particularly the shift to remote work and all its implications.
2. ESG and Climate Change
The emphasis on new disclosures, regulations, and compliance on issues related to environmental, social, and governance (ESG) matters will continue to escalate under the Biden administration. Boards will need to develop controls and processes to ensure disclosure compliance. Further, investors will be increasingly focused on the links between ESG performance and executive compensation.
3. Corporate Political Activity
In this environment where everything is politicized, boards are seeing the need to establish frameworks to lead corporate engagement in social and political issues. It’s a challenging task to navigate but attendees agreed the role of business should focus on finding common ground to help diffuse current tensions.
4. Board Operations
The pandemic brought on a new way of getting work done as board meetings were held virtually and new tools and structures were developed. Now directors will need to think carefully on how to best structure their time together moving forward.