The year 2020 put boards front and center with serial challenges of the pandemic, social justice movements, and rising demands for a real response to climate change. It was a year of health crisis response that had boards supporting a new wave of transformational change. A lot of the challenges produced excellent outcomes in employee protection, stakeholder trust, safety, and respect. But as the adrenalin wanes, boards may be facing 2021 with some fatigue and loss of focus on longer-term strategic outcomes.
A look ahead for board governance
As we work to engage and re-energize our boards, it’s time to consider what governance topics should hold a spot on board meeting agendas in 2021 and beyond. We hosted an expert panel webinar to offer guidance to boards as we all navigate priorities ahead.
Acknowledge the accomplishments of 2020.
The last year did not go according to plan for any board. The pandemic pushed boards to shift governance priorities from planned objectives to crisis response, often with a people-first focus. Organizations across industries suddenly had the same top priority: ensuring health safety for all. For many that meant setting policies to get employees working from home almost overnight, implementing physical distancing protocols, extended sick-time, and for others it also meant shifting to online services, waiving fees, deferring payments, and other shifts in business delivery.
As boards work to retain valued directors, calling out the achievements and outstanding human contribution of board members over the last fourteen months is a wise first move. Even if Covid derailed board succession plans and you have some directors you need to retire, begin readying your board for the challenges ahead with some meaningful recognition or celebration of the strides your board and organization made in staying resilient.
Continue pandemic response and recovery.
With 2020 being such an intense year, and pandemic response still underway, it can feel tricky to shift from crisis response back into a longer-term recovery mode. But making that shift is identified as one of the top three priorities for board governance in the February 2021 Society of Corporate Governance Board Practises Quarterly, with 84% of public boards reporting they foresee including pandemic recovery and recovery to the agenda of every board meeting in 2021.
Advance board diversity.
While the pandemic may take top spot for global societal impact in 2020, #MeToo, Black Lives Matter, and other social movements declared the urgency for inclusion including at the corporate and board level. The challenge ahead for boards will be to take stock of board members and have a real and possibly challenging conversation about diverse representation. That can mean developing a proactive recruitment policy to attract directors that reflect diversity in customers, members or stakeholders served or simply overcoming the bias that can come from a small group of people recruiting successors from the same social circle over the years.
Address climate change and environment.
Forward thinking boards are defining bespoke policies to recognize and protect impact on the environment that are authentic to the organization. Many experts say it won’t be long before regulating bodies make it mandatory.
Marked as one of the most urgent challenges of our time, boards – charged with managing any potential strategic risk to business – are being encouraged by business leaders to make progress on moving the dial on climate regulations and affairs. Concurrently, stakeholders are looking for accountability and actionable performance towards mitigating the physical and transitional climate-related risks, while balancing the long-term financial goals of the organization. Having clear board governance guidelines, like these outlined by KPMG and the World Economic Forum (WEF) will help your organization be clear and authentic while aiming for positive impacts.
How can boards best tackle 2021 priorities?
How do you make sure your board has the right members, the right agenda and the right communication to navigate and stay agile the next few years? See our expert-panel webinar we hosted to see how to ready your board for 2021 and beyond.
While the past year was unprecedented, the pace of change and challenge ahead is forecast to remain intense with pandemic recovery, board diversity remaining key boardroom priorities. That’s a demanding set of goals on top of other organization objectives, especially for small and mid-sized organizations.
See the takeaways and recording
About the Author
Ian Warner, President & CEO
Ian has been leading Aprio since 2010 and believes in passionate leadership, values, transparency and personal accountability. Before joining Aprio, he was the COO of Canada’s largest credit union, Vancity. He is a lifelong learner and marathon runner.
