Best Practices for Board Leadership During Times of Uncertainty and Instability

• DOI: http://doi.org/10.1002/bl.30151
• Author: Sandeep Aujla
• Date: 01 January 2020
• Published date: 01 January 2020

Best Practices for Board

Leadership During Times of

Uncertainty and Instability

By Sandeep Aujla

Sandeep Aujla is the president and founder of Multilevel Leadership Consulting,

based in Brampton, Ontario, Canada. In this article, she explores the role of the

board of directors during times of acute uncertainty, and lays out a series of best

practices for corporate governance when organizations operate in an unstable and

unpredictable political climate.

Volatility, uncertainty, complexity,

and ambiguity are the four tenets

of the VUCA world that create the

shared reality in which corporate and

not-for-profit organizations exist today.

Moreover, organizations across all sec-

tors consistently face strong forces of

change from political, environmental,

social, technology, legal, and economic

(PESTLE) domains. Such harsh and

volatile conditions amplify the need for

effective corporate governance.

The role of corporate governance

has evolved over the past century, with

the board of directors requiring greater

access to relevant and appropriate

information.1 Moreover, the scandals

from the early 21st century relating

to the failure of governance controls,

including Enron and WorldCom, forced

a shift in the governance role from

monitoring to a more acute and criti-

cal appraisal of internal controls and

organizational performance. They also

broadened the interest and scrutiny

from diverse stakeholders, including

politicians, regulators, and the public. In

addition, they led to significant reforms,

including the Sarbanes-Oxley Act

(2002) in the United States of America.

Nevertheless, there remain several criti-

cisms about the limitations and flaws in

contemporary corporate governance,2

highlighted by the continuing exposure

of scandals such as those of Lehman

Brothers and Madoff Investment.

The viability periods for organiza-

tions continue to decrease globally,

with corporate longevity forecasts

of S&P 500 companies projecting an

average tenure of companies to shrink

to 12 years by 2027.3 Anthony et al.

predict that “at the current churn rate,

about half of S&P companies will be

replaced over the next ten years.”4

Furthermore, the average tenure of

CEOs continues to decrease, with

median tenure noted at five years for

the CEOs of S&P 500 companies.5

The governance role now requires

further transformation, forced by

the rapid decrease in organizations’

lifespans, along with the average ten-

ure of CEOs leading those organiza-

tions—both constituting strong forces

NUMBER 167, JAN.–FEB. 2020

www.wileyonlinelibrary.com/journal/bl

BOARD LEADERSHIP

INNOVATIVE APPROACHES TO GOVERNANCE

View this newsletter online at wileyonlinelibrary.com

Board Leadership • DOI: 10.1002/bl • JAN.–FEB. 2020

(continued on page 2)

N E W S

Candid webinar looks at ‘high-

performance’ practices for

nonprofits

Candid will host a webinar titled

“High-Performance Practices Suc-

cessful Nonprofits Need” on Feb. 6

at 2:00 p.m. ET.

The webinar, hosted on the orga-

nization’s Grantspace.org platform,

will be led by two nonprofit leaders,

Terri Sorensen and Juan De Angulo,

who will share how the Performance

Imperative and the Performance

Practice, which are core resources

drawn from the Leap Ambassadors

Community, can help nonprofits

advance their missions. The webinar

– which targets nonprofit boards

and executive leadership – will look

at case-study examples, including

how Friends of the Children used

the resources to align chapters

across the country around their

joint goal of achieving the best pos-

sible results for as many children as

possible. As another example, the

leaders will discuss how Congreso,

a multiservice organization, inte-

grated the resources into a broader

organizational improvement effort.

Upon completion of this webinar,

attendees should be able to:

•introduce a framework for

continuous improvement in

their organizations,

•use an organizational self-

assessment to engage

stakeholders in identifying

organizational needs and

articulating a plan for

improvement

This webinar is free to the public.

For more information, visit

https://bit.ly/36VVl9l.

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