"Never Let a Good Crisis Go to Waste": Five steps to guide the board in responding to a corporate emergency.

• Author: Pozos, Clare Putnam

At some point during every director's tenure, a crisis will hit. There is no doubt that, when it does, all relevant stakeholders will look to the board for their leadership, yet with some level of scrutiny. How did the board respond to the crisis? Could the board have prevented the crisis with better oversight or governance? Can the board ensure that this type of situation never happens again? In order to be prepared, directors are best-served if they follow the below five steps to strategically guide their corporations through a crisis.

Gather the right team. When a crisis hits, the first step is to make sure that the right team has been gathered to respond. Are the key decision-makers for the company informed and working together? Does the CEO have the right people around him or her to help gather information and evaluate next steps? Has the board been properly engaged, with the right directors in the room? Does the company have the right spokespeople (inside or outside of the organization) to engage with the media, if and when the time comes? Do you have a trusted lawyer with the experience to help evaluate the legal benefits and risks of your crisis response and related communications as they arise? The right lawyer leading the response allows the company to control and access advice from specialists, and if appropriate steps are taken the attorney-client privilege can protect sensitive deliberations from disclosure (and being second-guessed).

Different people will be needed to respond to different crises. For instance, the head of human resources would play a significant role if there have been allegations against an employee, while the chair of the audit committee will have a heightened role if financial regulators have knocked on the door. But no matter what the crisis is, there are certain people who will always be part of the core team needed to respond. Have your board and the CEO discussed who those people are? Do those people know that they are part of the core team?

Understand the crisis. Once the team is assembled, everyone (including the board) needs to be well-informed and ask the right questions. What happened? When did it happen? Were the appropriate stakeholders notified when they should have been, or are you now responding to a crisis that quietly started quite some time ago? Is the root of the crisis currently internal (e.g., an employee has made allegations against a senior executive) or external (e.g., hackers have...