Summer is here affording a good opportunity to get away. This is also true for the Board.
Yes, the travails of business life are unrelenting with stubborn inflation, persistent talent shortages and activists not easing up. But for most the absence of an August Board Meeting creates the possibility for a vacation or at least a change of scenery. This is evidently important for recuperative purposes but also for reflection.
Fidelio has accompanied Boards through a myriad of challenges and opportunities over the past year. Our focus is to ensure that Boards are well placed to navigate and provide leadership whatever the complexity they face, and we see that this can make very significant demands on those at the helm. Standing back from the fray can be invaluable and deckchair reflections are often a prompt for high quality and longer-term thinking.
REFLECTIONS FROM A DECKCHAIR
In this Overture Fidelio focuses on three topics that Board Members will almost certainly be mulling over, even as they enjoy the Summer break:
With Asia, Europe and the US at record temperatures in mid-July, it is clear that climate change is increasing the likelihood of extreme weather events. Indeed, as our topic is holidays, it is worth noting that climate change is already having an impact on where and when people travel. This may seem a trivial point to the travelled classes but much less so to the tourist vendor whose business has just dried up with the decline of tourist trade.
For Board Members the Summer break provides an excellent opportunity to consider whether their respective companies are being ambitious enough in tackling climate change, as Chapter Zero advocates. Is greater leadership possible; have risks been overlooked; have commercial opportunities been left unturned? Two points are likely to focus the Boardroom mind: (i) the publication of transition plans in Autumn 2023, and: (ii) the growing awareness of why a just transition matters. Boards have a key role to play in both – testing and challenging the level of ambition on the transition plan and being thoughtful about climate opportunities being made broadly available and not narrowly restricted to the wealthy.
While undoubtedly Board Members want to return from vacation with a renewed sense of urgency on climate change, there clearly are no silver bullets. A period of reflection is invaluable to ensure that actions and ambitions are aligned. It’s also an opportunity to identify where ongoing Board learning on climate needs to be focused.
A second theme for deckchair reflection is culture. Board Members across Europe and the US will be struck at how younger entrants to the workplace have clear expectations on culture and are vocal when these expectations are not met. Boards accept the role of setting the tone from the top but the levers available to the Board in establishing a healthy and robust culture throughout the company are complex and not always visible nor properly understood.
Board Members in the UK have seen leading organisations under the media spotlight on cultural issues and scalps have been taken. While a good culture is incontrovertible, Board Members do need to reflect on reputation and resilience, in particular for business leaders in the public eye. Standing back from the media clamour provides a good opportunity to contemplate what are the hallmarks of a strong culture – what are its characteristics; how is it developed; how is it nurtured; and what are the warning signs for Board Members that all is not well? Importantly how can the Board navigate situations where expectations regarding culture differ.
Culture is undoubtedly the glue that holds organisations together. Taking time to think through this most complex but rewarding of subjects – how people can feel motivated and included in achieving a common goal – is surely a worthwhile deckchair reflection.
Without a doubt, anyone in a leadership role is thinking about change. Boards may have breathed a sigh of relief once the pandemic was over but in many ways the pace of change for business has accelerated. Climate change and shifting cultural expectations are two drivers but in the past few months AI has also moved firmly on to the corporate radar screen as both a major disruptor and a significant opportunity. As with climate change there is also an overarching existential concern about AI and its implications for society. In terms of Board learning Fidelio has seen the demand for “understanding AI” overtake “climate change competence”. Many Boards feel woefully underprepared to provide oversight and guidance regarding the use of AI within the business. This should indeed be a priority for H2 2023. Fidelio has already seen leading organisations dedicate entire strategy sessions to AI. The Board should certainly expect to see AI woven into strategy and most Board Members will want to undertake a rapid “upskilling” so that they are better prepared to kick the tyres and to challenge.
And while reclining on the holiday deckchair Board Members may want to reflect on what radical change looks like, and how organisations and individuals can develop the imagination, agility and resilience to navigate a very unpredictable future.
FIDELIO AND BOARD CAPABILITY
Fidelio supports Chairs and CEOs in building Board and leadership capability.
As we move into Summer vacation season, Fidelio strongly advocates taking time for reflection. This is essential for the fast-paced challenges that all organisations will be facing in the latter half of 2023. Those at the helm, be it Board or Executive, will be called upon to provide leadership often under pressure. Fidelio looks forward to providing the support needed, through Evaluation, Development and Search, to ensure business leaders are well prepared for the challenge and opportunity ahead.