As pressure mounts for companies to end business shutdowns and begin operating as close to normal as possible, directors need to be aware of their risk.
Businesses may feel compelled to focus on the short term, but given stakeholder interest, putting off long-term ESG initiatives could cause irreparable harm.
Shareholders give no indication of putting ESG on the back burner. In fact, its significance seems to be rising—and boards need to be ready.
As a fiduciary, it will be hard for boards to argue that allowing a sitting CEO to serve on multiple outside boards during a crisis is in the best interest of investors and stakeholders.
In order to perform their essential oversight duties, directors need to understand the problems their executives are focused on solving as they chart a course from crisis to recovery.