From risk to resilience: A new paradigm in board risk oversight?

By Regine Slagmulder (IDN alumna & former INSEAD faculty member)

The Covid-19 pandemic has been an unexpected shock that is creating extraordinary challenges for companies and their boards on how to navigate uncertain and turbulent times. Previous viral outbreaks rarely made it onto the busy boardroom agendas, but the sheer scale and impact of this crisis has called for undivided board attention. While high-impact/low-probability events are usually very difficult – if not impossible – to predict, it is never too early to start thinking about how to weather the next storm and come out stronger than before. This article argues that boards must spearhead companies’ transformative change in today’s business environment, which is characterized by high velocity, complexity, ambiguity, and unpredictability.

Risk management as a necessary but insufficient condition

As part of their oversight duties, the board of directors is responsible for making sure the company has put in place the necessary risk management capabilities to deal with the negative consequences of unforeseen events. Many companies have made significant progress in implementing adequate risk management systems and procedures, especially in the aftermath of the 2008 financial crisis. They are now better equipped than before to handle incidents through well-established risk registers for identifying risks, information systems that provide appropriate transparency on the downside impact, and contingency plans ready to be enacted whenever disaster strikes.

However, there is a major difference between risk events with well-known consequences, such as an industrial accident or a cyber-attack, and unprecedented disruptions, such as the Covid-19 pandemic. The former situations, as overwhelming as their occurrence might be, can be expected to return relatively quickly to the “old normal” after proper recovery measures have been taken. In contrast, the latter events typically do not lend themselves to an existing playbook approach to risk management and are likely to have a lasting impact – not only on individual companies but possibly on entire industries and geographies. While there are clear benefits to putting in place formal risk oversight arrangements, such as quantitative risk analysis and risk committees, to handle the “known” risks, these established mechanisms are insufficient in an environment of deep uncertainty characterized by “unknown unknowns”. Boards must, therefore, elevate their risk oversight role from a routine exercise in operational loss prevention and compliance, to acting as an enabler of long-term corporate resilience.

Boards must, therefore, elevate their risk oversight role from a routine exercise in operational loss prevention and compliance, to acting as an enabler of long-term corporate resilience.

Building resilience: from fragile to agile

While most companies suffer considerably from dealing with an external shock such as the pandemic, some organizations appear to come out of the crisis remarkably resilient. To achieve effective governance, the boards of directors must ensure that the necessary “resilience capabilities” are in place that allow the organization not only to bounce back from a high-impact disruption but also adapt to the new reality more quickly than their peers. These capabilities relate to two key aspects of resilience – preparedness and agility.

First, preparedness refers to the pre-crisis arrangements that the company and its board have put in place to anticipate and proactively mitigate the negative impact of risk events. Examples include information systems for monitoring risk indicators, robust business continuity plans, and slack resources. It also involves actively engaging the diverse set of professional experiences and backgrounds present in the board as well as regularly obtaining outside-in views from external experts. The board’s continuous outlook for what may be coming “around the corner” can significantly contribute to sharpening the leadership team’s sensing skills and detecting strategic risks before they spin out of control. Forward-thinking boards also pressure test management’s assumptions about the longer-term consequences of the virus. Combining these insights and foresights in strategic scenario planning exercises enables boards to take precautionary measures already at an early stage, thus making their companies more resilient to shocks.

Second, agility is required because it is impossible to fully prepare and plan for complex and dynamic situations, especially when it is unlikely that the situation will afterwards return to the pre-shock state of normality. Superior levels of in-crisis adaptation enable companies to take decisions quickly and get ahead of the disruption. The first stage in crisis response is usually one of creative, entrepreneurial problem-solving in real time as the events unfold to secure the company’s immediate survival. Then, as soon as the crisis is under control, the board should stimulate the management team to think proactively about introducing new business models in the “new normal”, for example by accelerating investments in digitalization. As such, it is important to make a shift from the classic mindset of mitigating downside risk to becoming more opportunity driven. Board members need to proactively engage with their executives to discuss how even highly adverse events, such as the Covid-19 crisis, might be leveraged into strategic opportunities to be exploited in the longer term. For example, companies might consider acquisitions targeted at growth in previously underdeveloped market segments, such as a specialty chemical company diversifying into the medical hygiene products business. Effective risk oversight in the context of a major disruption thus requires boards to rise above their traditional monitoring role and develop a strategic stance to dealing with risk. Companies whose board members consider risk as an integral part of their business strategy rather than as an after-thought, are bound to have a competitive edge in building resilience for the future.

Effective risk oversight in the context of a major disruption thus requires boards to rise above their traditional monitoring role and develop a strategic stance to dealing with risk.

Adopting a long-term view

While extreme circumstances require that the board’s immediate attention be directed towards ensuring the company’s survival, directors must also adopt a long-term perspective, with a clear focus on strengthening the organization’s resilience in a sustainable and purposeful manner. Maintaining a long-term perspective might entail a delicate balancing act to reconcile the interests of shareholders and other important stakeholders (employees, customers, suppliers and the broader community), as well as responding to calls for greater clarity on the organization’s ultimate purpose. Take, for example, the recent public outrage about several financially strong international groups that (ab)used governments’ emergency response to the Covid-19 crisis to defer rent payments on their shops, with potentially detrimental consequences for small store owners. In times of severe turbulence and existential anxiety, it is particularly important for boards not only to protect their company’s short-term financial and operational performance, but also act as a beacon with a long-term view for the future on corporate purpose, social responsibility, and reputation.

Is there an opportunity? Our life after Covid-19

By Konstantinos Yazitzoglou, IDP-C and IDN Greece Ambassador 

“In the midst of every crisis, lies great opportunity” –
Albert Einstein

We are undoubtedly experiencing one of the greatest crises in modern history. A crisis unlike any other and therefore with unknown consequences. “Experts” try to assess its effects on our lives and predict the new reality to come. If, like me, you are sceptical about futurism, the current situation certainly helps reinforce this view.

Most of us agree that, at some point, there will be “a day after”. Whether it will be a day with a vaccine or efficient medications, with a lot of social distancing or none, with fear or not, it is difficult to say.  We understand there will be a recession, but we hope that it will be controlled and reversible. We recognize that some companies, or even whole sectors will cease to exist, but we hope that ours will survive. Some of us even dare to foresee major changes in their personal and business life, but consider them manageable.

Economists often refer to the expression “ostrich effect”.  In simple terms it means that when faced with an unmanageable crisis, people tend to close their eyes in an attempt to ignore the problem they’re faced with, hoping that at some point, when they open them again, the problems will be gone, and everything will go back to being the same. As the philosopher Ayn RAND characteristically states, “You can ignore reality. But you cannot ignore the consequences of ignoring reality.”

“You can ignore reality. But you cannot ignore the consequences of ignoring reality” – Ayn Rand

It is true that during a massive storm common sense dictates we should do our best to minimize our exposure to any potential damage. At this point in the COVID crisis, our organizations’ ability to react is limited to trying to  “preserve the status quo”, which is surviving the storm with the least possible losses. Size adjustments, changes in production models, access to markets or products that until yesterday were not a priority are just some of the methods used. While there are various good practices and lessons we can use from past crises, there is clearly no “recipe for success”.

The upcoming economic recession is a given and all we are talking about is its magnitude – how much and for how long. Central Banks and Governments are already employing various financial measures to control the situation, but the degree of their success depends entirely on the duration and intensity of the pandemic.

The crucial question that business leaders need to answer now, is what the post-crisis era will look like. Even if we manage to overcome the health crisis, everyone agrees that some things will never be the same again. For instance, it is certain that for a period of time public spending in health will increase significantly. This, in turn, will deprive other sectors from funding. There are already discussions about “deglobalisation” so that, should we be faced with another pandemic in the future, we can have a “local” supply of markets. Such initiatives may change the rules of the game in the utilisation of raw materials and in logistics.

Business travel needs will be reassessed, with potential implications for fuel consumption, transportation, and infrastructure investment. The ability to do remotely things that until yesterday required our physical presence in a certain location, will reduce the need for such locations (offices, shops, etc.). On the other hand, working from home will require investment in both real estate and equipment. Even Wi-Fi and cellular networks will have to be significantly strengthened in residential areas, to accommodate the increase in demand generated by the new professional grade use made.

The term disruption was coined twenty years ago, to describe a state of rapid and unexpected change. The main characteristic of disruption is that no extrapolation of data from the past can give valid predictions of the future. COVID is a disruption of the disruption. Long before the current crisis, the academic community conducted dozens of case studies of large corporations (for example KODAK), which stubbornly refused to see the speed and intensity of forthcoming changes, leading to their disappearance. The current pandemic is simply accelerating this process, on the one hand because developments occur even faster and on the other hand because many of us, in complete denial of reality, will continue to “dream” of returning to a pre-pandemic state of things.

Having said that, we must not ignore that the same changes which led “dinosaurs” to their deaths have fuelled a series of greater or lesser successes for several agile organisations. The speed of adaptation to the new reality is nowadays the strongest competitive advantage for an organization. When the instinct of survival meets creativity, the result is always positive. Humanity will continue to exist even after COVID, the world GDP always finds a way to return to a growth trajectory after a crisis, developments in technology will be even faster and perhaps more focused.

“Do not think what you want from the future. Ask yourself what the future needs from you.” – Jeffrey Rogers

Clearly, for many of us, the loss of the “status quo” and the collapse of the “comfort zone” that we had painstakingly built on, are facts that we find difficult to manage. Wishing that it will all go away may be comforting in the short term, but it will not get us very far. Instead of being ostriches, let us follow the advice of Jeffrey ROGERS (Singularity University): “Do not think what you want from the future. Ask yourself what the future needs from you. ”

 

Beating the dragons: Fairy tales in the board room

Book Review – Telling Fairy Tales in the Board Room – How to make sure your organization lives happily ever after
Author: Manfred F. R. Kets de Vries, Distinguished Clinical Professor of Leadership Development and Organisational Change and the Raoul de Vitry d’Avaucourt Chaired Professor of Leadership Development, Emeritus, INSEAD
ISBN: 9781137562746

By Pamela Ravasio, IDP-C and IDN Board Member

 

 

 

 

 

 

 

Fairy tales is typically something for kids. Particularly young kids. Over the centuries they have been used fundamentally to convey social mores, warnings from danger, and to inoculate a shared understanding of what ‘good’ and ‘bad’ looks like. They have also found their use trying to make us all believe – maybe naively? – in the good of humanity, and in the ‘happily ever after’.

“If you happen to read fairy tales, you will observe that one idea runs from one end of them to the other–the idea that peace and happiness can only exist on some condition. This idea, which is the core of ethics, is the core of the nursery-tales” – G.K. Chesterton

The notably useful aspect of fairy tales is their approach to simplify all relevant ingredients to a good story: the characters (typically either good or bad), the context (often medieval-style kingdoms), the social standing of the main characters (nobles or paupers) and in particular the lessons to be learned.

This characteristics though make fairy tales an ideal, if very uncommon, vehicle to convey information and learnings also in management literature. And in a much more colourful, even memorable, manner than would be possible than through any of the coveted, but often rather uninspiring case studies brought forward by business schools around the globe. After all: a fairy tale to educate managers? Not an approach that normally would be seen kindly.

“As for fairy tales, he understood that they were reflections of the people who had spun them, and were flecked with little truths – intrusions of reality into fantasy, like toast crumbs on a wizard’s beard” – Laini Taylor in ‘Strange the Dreamer’

Unless the author of such fairy tales in none less than Manfred Kets de Vries himself. A renowned academic and coach of CEOs of all colours, with a track record in both psychology as well as an economics, he dared to depict in the fairy tale format the issues of dysfunctional leadership one can frequently encounter in the C-Suites of companies.

With two clear advantages:

  • A simplistic approach to complex dysfunctions: focused, sharp and clearly graspable description of the failing leader, and the reasons behind his failures.
  • The anonymity provided by the fairy tales to any one leader prone to such dysfunctional behaviour. Something even the most carefully written case study not be able to ensure.

Four Fairy Tales, Four Leadership Styles, Four Lessons

“The way to read a fairy tale is to throw yourself in” – W.H. Auden

The book, in addition to the introduction, offers the reader four stories about different types of (un)desirable leadership:

  • White Raven, or The Leader Who No Longer Knew Himself: A tale about self-delusion yet no bad intent. A tale that illustrates the disastrous results it can have on a society, and the difficult personal journey required for change.
  • The Bear-King, or The Price of Hubris: A tale about a leader’s arrogance and lack of sympathy (empathy?) for his people. A tale that illustrates how destructive and disruptive such behaviour is on thriving people and societies. And how – possibly – only a shock to the bones opens up opportunities for a different future.
  • The Kindly Crone, or How to Get the Best out of People: A tale about the gift to get the best out of people. A tale that illustrates how people willing learn, improve, and contribute under the right leadership. And also about how circumstances can lead to the exact opposite happening.
  • The Four Brothers, or How to Build an Effective Team: A tale about how successful leadership is a team sports. A tale that illustrates that knowing each other well, and trusting each other, cumulatively leads to achieving goals that individually would never have been possible to reach. And a tale that talks about paying tribute to everyone who made a difference and helped to achieve the results.

With just 125 pages the book is short, and its choice of language favours legibility over academic bravura. Every chapter ends with a set of pertinent questions that are suitable for boards and C-Suites to ask themselves about the current situation an organisation finds itself in. Or indeed the state of the succession funnel – be it for board memberships or the next CEO.

While the reading of this book is a rather straight forward task, the answering of the questions raised in each chapter is less so – if taken to heart and done seriously. Similar to the fairy tales, the questions are simple, and quick to understand. But they require a good amount of soul searching and – talking of methodological approaches – inquisitive (curious) enquiry into the DNA of an organisation and its people.

Summary

Telling fairy tales in the board room’ is a simple approach to illustrate and explain complex dysfunctional behaviours. The use of the Fairy Tale format allows life to be illustrated be black and white – and in this way separate the wheat of the desirable from chaff of the undesirable effectively, and in an easy to grasp manner that is graciously avoids the pitfalls of personalised scapegoating so common in published case studies.

First published here.

IDN Webinar: Tech for Good – What is the role of company boards?

Company boards have a key role to play in guiding organisations in the digital age.

By Karen Loon, IDN Board Member and Non-Executive Director

To celebrate the first ever digital edition of Global INSEAD Day on 12 September 2020, the INSEAD Directors Network (“IDN”) Global Club held a webinar open to all on “Tech for Good – What is the role of company boards”.

The global panellists were IDN Americas ambassador, Mary Francia, IDN Australia and New Zealand Ambassador, Helen Gillies and Dimitri Chichlo from Switzerland, who are all experienced Non-Executive Directors and INSEAD certified directors (IDP-Cs).

The panel was facilitated by IDN Board Member, Liselotte Engstam based in Sweden with Q&A support from Karen Loon, a fellow IDN Board Member based in Singapore.

Following an introduction by Liselotte Engstam, the panel conversation covered four broad areas:

  • How technology aligns to an organisation’s purpose and strategy
  • The increasing importance of stakeholder communication
  • How can boards best support management in the digital age
  • How can current and aspiring board members keep up to speed with developments

Technology should be core to your organisation

All three panellists agreed that today’s organisations must ensure that technology is an integral part of their strategies.  With companies facing increasing focus by external stakeholders, whether investors, clients or employees who are holding boards to account, organisations must have a proper purpose, and technology must support that purpose.

As Helen Gillies said, “Technology is just key – it impacts everything that we do; every interface that we have with our external stakeholders, clients, employees, every aspect of our business sales, so it’s just integral.  And so that means we must get that strategy around technology right”.

A challenge highlighted by Dimitri Chichlo which boards face is that few boards have people with technology and operations (including cybersecurity) experience, with the majority being business leaders.

Mary Francia added that a question boards need to tackle is how best to manage new risks which are much wider than financial risks – whether technological, geopolitical, environmental, social and governance.  “Without the right composition with other vital skills and expertise, you may not have the requisite depth to ask the right questions when it comes to technology, and to support and build what is driving tech for good” said Mary.

How can boards best support management in the digital age?

According to Helen Gillies, board members have a key role to ensure that the purpose of their organisations are reviewed regularly with management.

As board members, one thing that’s really critical is we have to be curious. So we have to be looking outside our organisation the whole time thinking what are our clients during, what are our competitors doing, how do we make our organisation better, so that that the concept of being hungry for information is really key” – Helen Gillies

A good practice which Dimitri Chichlo shared on how he supports management was to build rapport with senior leaders outside of the boardroom as soon he started his role to create some proximity with them, which was very much appreciated by management.

Because of increased pressure from investors and stakeholders, to enhance the competence of boards, in addition to more board education to support existing directors, Mary Francia sees more companies looking at their board compositions in detail, and  doing board assessments to look at the skill sets of the boards and gaps to identify whether new people should be brought in, committees created or advisors sought.  She highlighted the importance of boards having an inclusive culture for change.

The increasing importance of stakeholder communication

All panellists agreed that communicating more broadly about environmental, social and corporate governance (“ESG”) to stakeholders is becoming increasingly important.

Organisations should look beyond their local listing disclosure requirements, and share with employees, communities they work in, clients and investors more about what they are doing.  Further, they should understand the stakeholder concerns of their company’s most material stakeholders and ensure that they communicate messages clearly in a language which stakeholders understand.  Appropriate board level dashboards on the metrics which really affect the individual company’s business context are important as well as looking at the right outcomes.  Finally, having the right accountability, measures, and appropriate links between behaviours and remuneration (which are aligned the purpose of the organisation and its strategy) is crucial.

The panellists also highlighted that having technology and HR competencies on the board, and also ensuring that the management of HR and Technology partner together more closely is also going to be increasingly more important in the future, given that technology should be core to all organisations in the future, and often these two functions are not as aligned as they should be.

Mary Francia also reminded participants of the increasing importance of boards having an inclusive and ethical mind when looking at technology, and how it is applied.  Dimitri Chichlo added that this in particular needs to be considered when supporting employees as they adapt in the new world, as technology will impact different generations of employees in different ways.

How can current and aspiring board members keep up to speed with developments?

Our panellists were enthusiastic about the power of IDN’s network, its webinars and its mentoring programme to connect members which are excellent ways for IDN members to engage and keep up to speed.

“… the nice thing is to be able to just get on the phone and talk to one of your directors in Turkey for example or in India, and being able to discuss about a subject because the perspective is so different for every one of them; that that just only enriches and that you just cannot find anywhere” – Mary Francia

Liselotte Engstam highlighted that aspiring directors should seek broad experiences and try to get some P&L experience and run a business to become more familiar with dealing with complexity.

Mary Francia also recommended that aspiring directors gain experience early in their careers in more than one functional area, and “be brave enough to try something different”.

Dimitri Chichlo shared that “…if you work in operations, you will always touch technology, and you will learn on the spot.  Whilst books are great, learning with… IT people on the spot gives you an incredible amount of knowledge”.  He also mentioned that there are many shorter online programmes available which board and aspiring board members can do to help them keep up to speed with emerging trends and developments in technology.

When considering board roles, panellists however cautioned aspiring directors to ask specific questions to assess whether they are really comfortable with the risk of the organisation and how that organisation does things when things go wrong.

Final advice to board members

In their concluding remarks, the panellists highlighted that the rapid pace of change with technology, what organisations are doing now will not be what they are doing in another five or ten years.  Boards need to anticipate the technological changes and keep up with them.  Board members should also ask good questions about whether the organisation is innovative, sustainable, able to adapt to technological changes in the future, accountable and inclusive.

As Helen Gillies concluded, “…the current pandemic has challenged all of us thinking about everything…  How do we do things better? How do we challenge our thinking?  Because what was normal yesterday is not going to be normal tomorrow”.

A replay of this webinar will be available to INSEAD alumni shortly.  IDN’s next webinar for members will be on 16 October 2020, as part of the INSEAD Directors’ Forum.

55 additional board appointments for INSEAD Directors Network members

Members Board & Corporate Governance Positions Announcement 2Q – 2020 

INSEAD’s International Director Network, IDNis proudly sharing the recent appointments of board and corporate governance positions of our members, truly recognising our members and the strength of our IDN network.

IDN members have been appointed to 55 new board positions in 22 countries, summing up to 293 position announcements since 2017.

As a member of IDN, the network of INSEAD International Board Directors, (full membership is open to all INSEAD Alumni with appropriate directorship experience and is automatic for Certified Directors (IDP-C) from INSEAD’s International Directors Program (IDP)), you can be truly proud of your network!

You will find the IDN members with new board positions below.  Why don’t you help share our network’s achievement via Linkedin, as well as also position yourself and your membership of a vibrant network via this LinkedIn post.

And take the time to connect with your fellow IDN members at LinkedIn and expand your board contacts by clicking their names below and connecting with them!

To date, IDP has been completed by 1,302 participants, with 986 certified IDP-C/ IDBP-C directors, and our International Board Network IDN of INSEAD Alumni includes more than 1,475 members.

IDN works closely with INSEAD Corporate Governance Centre, which undertakes cutting-edge research and teaching tailored to the needs of boards and international directors.  The Centre fosters a global dialogue on the challenges of corporate governance and leadership in an international context.

INSEAD Directors’ Network – Members New Board & Corporate Governance Positions

IDN members – Certified IDP-C Board Directors

Céline Abecassis-Moedas – June 2020 – Non-executive Director at Vista Alegre Atlantis (Listed, HQ Portugal)
Carole Ackermann – April & June 2020 – Non-Executive Director at BNP Paribas (Suisse) SA (Private, HQ Switzerland),  Chairman at École hôtelière de Lausanne( Private, HQ Switzerland)
Xavier Bedoret – May 2020 – Independent Expert Member of the Audit Committee at Radio & Television Belge (Public Sector – Brussels)
Stefan Buser –June 2020 – Board member at Netrics AG (Private, HQ Switzerland)
Elisabetta Cugnasca – March and April 2020 – Board, Management Controlling Committee & Supervisory Body member at IW Bank (Private, HQ Italy), Board member of “Be Shaping The Future DigiTech Solution” (Private, HQ Italy)
Lale Develioglu – April 2020 – Independent Board Director at Aksa Akrilik (Listed, HQ Turkey)
Yves Elsen – April 2020 – Non-Executive Director at Ardagh Group S.A. (NYSEC Listed, Grand Duchy of Luxembourg)
Liselotte Engstam – June 2020 – Board Member at Institute for Management of Innovation & Technology (Foundation, HQ Sweden)
Ozgen Etker Simons – January 2020 – Non-Executive Board Member at Lake Geneva Investment Partners (HQ Switzerland)
Gerry Fitzpatrick –May 2020 – Independent Non-executive Director, Zurich Life Assurance PLC, Young Social Innovators Ireland
Barbara Frohn – May 2020 – Chair of the Supervisory Board at Citigroup Global Markets Europe AG (HQ Germany)
Daniel Frutig-Meier – May & June 2020 – Member & Delegate of the Board at Lerch AG – Winterthur/Switzerland  (Private, HQ Switzerland), Vice Chairman of the Board at Arviem AG – Baar/Zug (Private) and Board member at Misanto AG (Private)
Rutger Groot – March 2020 – Supervisory Board Member at Netherlands Africa Business Council
David Haglund – June 2020 – Non-Executive Board Director at Aramex (Listed, HQ UAE)
Denise Koopmans – August 2020 – Member Supervisory Board, Chair Remuneration Committee, Royal BAM Group NV (listed, HQ the Netherlands)
Joachim Kuske – April 2020 – Board Member at Luxembourg Director Institute (ILA) (NGO, HQ Luxembourg)
Karen Loon – January 2020 – Vice-Chair and Singapore Councillor at Chartered Accountants Australia New Zealand Singapore Council (NGO Professional Body, HQ Singapore)
Bert Meerstadt – June 2020 – Chairman of Supervisory Board at CB Logistics (Private, HQ Netherlands)
Bruno Mercier – June 2020 – Non-Executive Director at Bluemoon Holdings (Private, Cayman Islands)
Dominic Nixon – December 2019 – Chairman, Board of Governors at Tanglin Trust School (Private Education Sector, Singapore)
Gbenga Oyebode– November 2019 & March 2020 – Board of Trustees Member at Ford Foundation (Not-for-profit, HQ USA), Board of Trustees Member at The Africa Center (Not-for-profit, HQ USA), Non-executive Director at Lafarge Africa PLC (Public, HQ Nigeria)
Monica Porfilio – October 2019 – Non-Executive Board Director at Nature Investments S.àr.l.
Karl Reynders – February 2020 –Non-Executive Director at ELBA NV (PE-owned, HQ Belgium), Board Member at Indigo B Professional Services Pte Ltd (Private, HQ Singapore)
Thomas Seale – October 2019 & June 2020 – Non-executive Director at Raymond James SICAV (Luxembourg), Non-executive Director at LFP Opportunities SICAV (Luxembourg), Non-executive Director at Silver Holdings S.A. (Luxembourg)
Oern Stuge – March and June 2020 –  Chairman at  Neo Medical SA (Private, HQ Switzerland), Board of Directors at Median Technologies SAS (Listed, HQ France)
Aude Thibaut de Maisieres – May 2020 – Non Executive Director at Solvay (Listed, HQ Brussels)
Doris Tomanek – April 2020 – Member of Supervisory Board at AO Unicredit Bank, Chairwoman of Remuneration and Nomination Committee at UniCredit Bank Russia (Private, HQ Russia)
Bas van Buijtenen – April 2020 – Non-Executive Director and Member of the Nomination/Remuneration Committee at Microphyt, France (VC owned, HQ France), Non-executive Board Member at ABC Transfer (Private, HQ France)
Kees van der Vleuten – April, June & July 2020 – Member of the Board of Advisors at MAS Services
(Private, HQ Netherlands), Member of the Board of Advisors at Rahma Foundation (HQ Netherlands), Member of the Board of Advisors at Connecting Works, Member of the Board of Advisors at Worldlife Foundation
Till Vestring – July 2020 – Non-Executive Director at Delaware Pro (Private, HQ Belgium)
Helen Wiseman – April 2020 – Independent Non-executive Director at Elixinol Global Limited (Listed, HQ Australia)

IDN Members – Board Directors

Jeroen Cammeraat – March 2020 – Chairman of the Supervisory Board at Plasmacure BV, Netherlands (Private, HQ Netherlands)
Susanne Hannestad – March 2020, Non-Executive Board Director at Monty Mobile (Private, HQ London UK)
Gautam Khurana – February 2020 – Executive Director at Precious Shipping Public Company Limited (HQ Thailand)
Martin McCourt – May 2020 – Non-Executive Director at Sierra Wireless (Nasdaq: SWIR, HQ Vancouver Canada)
Robin Pho – February and April 2020, Non-Executive Board Member, Forum for the Future Asia (NGO, Singapore, HQ in the UK), Non-Executive Board Member at Family Business Network Asia (NPO, Singapore)
Joshua C K Siow – February 2020 – Non-Executive Independent Board Director at Pico (Public Company Limited, Stock Exchange of Thailand, HQ Thailand)
Jim Strang – May 2020 – Chairman of the Board at Hg Capital Trust PLC (Listed, HQ UK)
Remon Veraart – March 2020 – Supervisory Board Member at Euramax BV (Private, HQ Netherlands)

Previous announcements and more information

Previous board position announcements by shared by IDN;
March 2020 October 2019 July 2019  February 2019  November 2018 July 2018 April 2018  January 2018   October 2017

 

For more information about: 

INSEAD International Directors’ Network: https://blogs.insead.edu/idpn-globalclub

INSEADs Corporate Governance Programmes: https://www.insead.edu/executive-education/corporate-governance

For members of IDN, please ensure that you share your new appointments via survey shared to you vi mail, any queries contact l.engstam@insead.edu

For head hunters interested in finding international board members focused on staying up to date with latest board and governance insights, please contact IDN President, Helen Pitcher OBE, at helen.pitcher@insead.edu

For organisations interested in partnering with IDN, please contact IDN President, Helen Pitcher OBE, at helen.pitcher@insead.edu

On Behalf of the INSEAD International Directors’ Network Board,


Helen Wiseman, 
IDP-C, IDN & NAA Australia Board Member,
NED at multiple companies
www.linkedin.com/in/helenwiseman
helen.wiseman@insead.edu

AI Leadership for Boards – now a reality!

By Liselotte Engstam, IDP-C, NED and Chair, Communication, IDN Board Member

We are facing a period of disruption and disorder, and we need our leaders to show the way. Artificial Intelligence (AI) is one of the crucial technologies for solving our most critical business and society challenges for a more sustainable world. Board work is already a very challenging and complex task, and AI will bring that challenge to a new level.

When the National Association for Corporate Directors, NACD did a Survey of Public Company Governance 2019, prior to the pandemic, they found that three of the top five trends with the largest impact were technology related with growing business-model disruptions as the top trend.

Ref: NACD Public Company Governance Survey 2019

With an ambition to find insights to better guide boards, Fernanda Torre, House of Innovation at Stockholm School of Economics & Digoshen Partner, Professor Robin Teigland, Chalmers University of Technology and Board Professional, and I have pursued a two year academic and empirical research on the requirements of Boards Leadership of AI.  We found some unique insights on how boards can, without losing themselves in details or in technical jargon, move into the future of corporate governance.

To increase the impact, we decided to share our results in a bookAI Leadership for Boards – The Future of Corporate Governancewhich also holds guiding questions that can help boards move forward as they mature.

On 25 June 2020 we held our virtual book launch webinar and were fortunate to have some of our collaborators joining us, as the President of INSEAD Directors Network and Chair on multiples, Helen Pitcher OBE, CEO of Combient Mats Agervi, one of the founding faculty of Singularity University Kathryn Myronuk and MIT scientist researching digitally savvy boards and leadership teams, Stephanie Woerner.

The research was done in collaboration of companies like Combient, a unique joint venture of 30 of the largest Nordic globally operating companies, and FCG Group, a Northern Europe Governance, Risk and Compliance Advisory and Technology Services Company. We based the insights on literature review of both academic and practitioner literature, on deep dive interviews of more than 50 board members and chairmen and AI experts, on several board workshops including note debates notes and polls of 150 board members, and on surveys of 105 board members from across the globe, including the members of the global INSEAD Directors Network.

We have collaborated with INSEAD via guidance from Professor Stanislav Shekshnia and INSEAD Directors Network President Helen Pitcher OBE and with MIT via Dr Stephanie Woerner.

During the webinar we shared insights from the research that highlighted the need for boards to engage, and we shared example of cases and related board questions for boards to ask.

Dr Stephanie Woerner shared results from their research on the impact of Digitally Savy Boards and highlighted related insights of the new research of top teams.

Our findings identified that boards need to develop two competence areas to successfully steward their firms into the new normal. They will increasingly need to learn to balance the [1] guiding of Al operational capability and [2] supervising of Al governance capability.

The areas boards need to increase their focus and ambition on are within guiding of Al operational capability: 

1) Data Strategy and Management, 

2) Digital and AI-based Innovation 

3) Developing Digital Business Ecosystem

 

within supervising of Al governance capability:

4) Data, Ethics and Black Box Decision Making

5) AI Cyber Security 

6) Leadership in Digital Business Ecosystem

In the book, we have also summarized guiding questions that can help boards move forward as they mature.

Examples of questions in guiding AI Operational Capability

Examples of questions in supervising AI Governance Capability

The academic research project “4boards.ai”, has been run under the coordination of Chalmers University of Technology and Professor Robin Teigland, with contributions from Digoshen and House of Innovation at Stockholm School of Economics, in collaboration guidance of IMIT, an educational foundation ensuring increased cooperation between academia and industry to improve research validity and speed up the uptake of the results, and with funding from Vinnova – Sweden’s Innovation Agency.

The launch webinar was recorded and can be seen here.

The presentation deck can be found here.

A longer version of this blog can be found here.

On Risk – It’s the Reputation, stupid!

By Frans Cornelis, MBA83J, IDP-C

Risk management is one of the “big three” attention items for non-executive directors, along with strategy and talent. And the current COVID-19 crisis has left many scratching their heads, wondering what lessons one should draw from this highly unpleasant experience.

Previous worldwide crisis situations that virtually no-one had planned for gave rise to concepts like “The Black Swan”. So is COVID-19 a “Black Swan”? Probably not – to quote Michele Wucker, it is more like a “Grey Rhino”: a known risk, rare but by no means fully extinct, and with very destructive properties.

So what is a non-executive director to do? Classic “risk management” often has a financial and statistical focus. One can and should insist that an organization maintains sufficient reserves. Of all types. And it is obvious that the idea that if you have less than your maximum leverage you are inefficient or in some way not maximizing things for your stakeholders is probably overdue for a rethink. One organization I am involved with, and that had to close down completely for almost three months, is now very happy with the fact that they did not go anywhere near the limit, and that they are therefore surviving where others have already gone bankrupt.

Over the decades, “Risk management”  has almost been developing in a specialized science. In many if not most major businesses, there are elaborate schemes to assess risk; usually on the financial side (interest rates, policy changes, but also things like fashion change etc.). Mostly drawn up by accounting people. As a non-executive director, you could be forgiven for thinking that you have done your job well when you have scrutinized, probed and discussed the typical complex and serious report on “Risk Management” that has been produced for inclusion in the annual report.

And yet…… The Covid-19 crisis should also make us think first and foremost about something the Coca Cola leadership used to say: “You can take away everything, but if you leave the brand and some of our key people, we will rebuild the business”.

And, interestingly, science backs this up. The annual AON risk management surveys have a consistent item in the #1 spot for largest risks for decades now: Reputation.  Not industrial policies, fashion, monetary policy, flooding or what have you. They all figure in the lists, but Reputation comes out on top.  Almost every time, usually by some margin.

Also, the Boston based Reputation Institute, in cooperation with the Rotterdam School of Management (RSM), runs serious longitudinal studies of many thousands of organizations worldwide measuring “Reputation”. They also point out that Reputation is closely linked to another concept: Identity.

And there are quite a few cases, with verified examples, where they can prove that a high reputation score allows you to recover quickly from a disaster, whereas a poor reputation score does not.

Studies by prof. Cees van Riel (RSM, now emeritus) also show that the actions in the initial phases by the company executives and spokespeople are critical for benefiting from that “Reputation cushion” or not. The wrong actions quickly destroy that reputation, sometimes forever.

Like in the well-known case of once world leading Perrier water, where a contamination was detected in their flagship product. While a recall was forced on the company in the USA, the management sought to play for time and declared, untruthfully, that this had been a one-off mistake. In reality, it soon became clear that water all over the world had this contamination, and that it would have had this for quite some time. In a post mortem, it turned out it was due to bad quality and process control at the source itself.  Why did management lie, did they know they were lying? Hard to tell, but certainly the attitude was one of denial, at the expense of their customers, and subsequently, the other stakeholders. The company never got anywhere near its previous market share, valuation and standing. It was sold 18 months later – to a direct competitor.

So does this mean that non-executive directors should also insist on better PR people, or that they should have probed the quality systems at the core processes better? That cannot be the right answer, as they would end up firmly on the chairs of the management.

What it does mean is that we should all be aware that while Reputation is the key risk, it is very closely linked to the actual Corporate Identity. That Identity is defined by norms, values, ethical choices, character. Not so much the beautiful words in the corporate statements, but the real actions and the actual paradigms.

What it does mean is that we should all be aware that while Reputation is the key risk, it is very closely linked to the actual Corporate Identity.

What you do in a crisis will be seen by all stakeholders, and they will immediately notice when, faced with a tradeoff between the interests of various groups of stakeholders, the company chooses against its customers.

This “Identity” (the actual one, not just the one on paper or in advertising slogans) is something formed over many years, and ingrained in the character of the employees. It is heavily influenced by the actions and personal examples of the management. The “value statements”, “purpose statements”, “brand” or whatever they are called are certainly important, and one has to start from somewhere, but actual behavior is the deciding factor.

That Identity is, as the Germans like to say, “Chefsache”. So yes, a Risk Analysis does deserve the full attention of good non-executive directors. If the report does take Reputation into account, so much the better. But in my mind, great non-executive directors have also made sure that the core values inside the organization, what people feel they stand for, and the ways the outside world perceives the organization, have been carefully defined and strengthened.

When a highly appreciated Identity as externally perceived is aligned with the “employer brand”, the  “corporate brand promises”, the investor reputation, and the actual internal and external actions, you have a fantastic foundation that will also guide and determine the right actions in a crisis, when there is no time to weigh and ponder each individual statement or action.

In the current COVID-19 crisis, there are many examples of companies that were quick, open and transparent when they could not keep their promises. I know of some organizations where clients literally sent emails saying ”Keep my money, hang in there, and we’ll see what you can do when this is over”. But there are also many companies who leapt from promise to promise, did not follow through on the promises for many months, got into overly legalistic and “small print” conversations and lost a lot of sympathy with their stakeholders.

I have a hunch who, a few years from now, the winners will turn out to be.

So my recommendation for non-executive directors in these times is: do read your Risk paragraphs – but also do check whether the crisis actions harm or bolster the reputation of the organization. And whether there is a clear, admirable and effective “Identity”. Because once survival is more or less assured, that is what will determine how well you can bounce back – or not.

Corporate Governance in Startups

The need for appropriate governance in startups is becoming increasingly acknowledged, however the experience in doing so in the best possible way is however limited.

Luc Sterckx, President and member of the boards of a number of international boards, and an INSEAD alumnus and IDP-C (INSEAD Certified International Director) has recently published his book, “Corporate Governance in Startups” which clarifies the distinctions which need to be made, in particular in the context of the limited means of a startup.

The book combines the structural and legal basis of governance in startups with his extensive experience in the field over several years and shows the way of very practical implementation including setting the right priorities.

We asked Luc his advice on the following important questions:

How do you implement good governance in a start up?  What should be the right priorities?

Given the limited resources (in time, experience, competence) of a startup, implementing of good corporate governance is not an easy task – that does not make it less important however quite the contrary.

When asked what the priorities should be, I think compliance with legal provisions is a first must have, second investing into an appropriate board of directors and thirdly realizing you start on a never ending journey of continuous improvement in this field. It is a team effort much like in bigger companies but in a quite significant environment.

The implementation of good Corporate Governance in a startup is mostly a matter of learning and improving along the way. In the often-hectic environment of getting a company launched, Governance seldomly gets the priority it deserves (although this appears to be changing).

Anyway, at the start the situation will be what it is, which probably is a long distance away from “best” Governance practices. That should not be necessarily too negative, provided there is consensus on continuous improvement of the Governance process.

What are the best practices you recommend in governing startups which allow them to remain workable and efficient compared to bigger companies?

A startup by definition is facing a serious number of challenges and choices – possibly even larger and more complicated than an “established” company. The need for focus has been stressed before but considering the many options and questions, it is clear that not all matters might get focus. It is all a matter of setting priorities and setting such priorities, balance is essential and Governance structures play an important role in this process.

“It is all a matter of setting priorities and setting such priorities, balance is essential and Governance structures play an important role in this process.”

The first balance which needs to be respected is the one between the short and the long term. In a startup fires abound, and it is tempting (and sometimes necessary) to turn the entire team into firefighters.

The second balance is the one between the different stakeholders, where especially the interaction between founders- entrepreneurs-shareholders-managers on one side and the external shareholders on the other is a tricky one.  A particular point of interest is the relationship with the founder(s) – he/she or they did not start the company to become experts or champions in Corporate Governance. Their key values and interests revolve around creativity, freedom, growth … and these should be taken into account and above all respected by the Governance structures.

The third balance in the company relates to the structure of the balance sheet. In particular, the company should be attentive at financing the long-term capital needs by long term liabilities such as equity and long-term loans.

The fourth balance concerns the necessity to maintain a creative, entrepreneurial free spirit and atmosphere in the company while on the other side a similar necessity to manage and control the company through instruments such as budgets, reports, procedures.  Once a company has been set up, the latter principle becomes unavoidable whereas the former necessity can be and often is essential for the growth of the company.

The fact that financial resources are always with a limit makes it however necessary to stay in control of what is happening. That can be done in a remote way, at arm’s length by allowing “creativity with a purpose” to evolve within a given framework. A lot will depend on the personalities of the people involved in this debate, but with some goodwill things can be straightened out.

What would be your key recommendation to directors who are asked to be on the board of a start-up?

I don’t think these are so different from the ones for “ordinary” companies.

Before anything else understand the fundamentals of the business and the strengths / weaknesses of the company are prime objectives. And maybe some particular qualities required: be flexible and above all prepare to ride the storm!

 

The Good Coach Wins The Game – The Chairman And Their Team

By Kolja A. Rafferty, MBA, IDP-C and IDN Switzerland Ambassador

In professional sports, mental readiness is key for champions.  This is highlighting the importance of being mentally balanced also for senior executives. The Non-Executive Board must observe and nurture the mental health of the firm’s top executives in addition to overseeing the firm and acting as the interface between shareholders and executive management, to create resilient and sustainable organizations.

Executives are skilled, able, and well-meaning! Yet, in situations of rapid change, they are observed to act dysfunctional.

Research has shown, executives are skilled, able, well-meaning, and well informed about the firm and its surroundings. In general, they are motivated to pursue the best interest of the shareholders. However, in economic turmoil, executive teams have been observed, to fall into a cycle of dysfunctional communication. This is starting with a state of secrecy and denial, further escalating to blame and scornavoidance and turf protection and finally passivity and helplessness.

“Some pressure is good. It makes them run faster!”

A myth in management claims: A level of stress enhances the task performance of the employees. This belief is based on research results conducted in 1908 by the two animal behaviorists Yerkes and Dodson at the animal behavior faculty of Harvard on Japanese dancing mice and has been challenged by various scholars in the past years. Unless the executive team has been recruited from Japanese dancing mice, an increased stress level is diminishing executive performance.

Global sports management is ahead of bespoke management practice

Across different disciplines the global market for professional sports achieved 2019 a total revenue of $ 1.8 billion, leaving an average sports team with a revenue of $ 39.5 mil., in the same spot, as many SMEs. The sports industry is in reality a subbranch of the media and entertainment sector, where task-performance objectives are only on semblance reduced to scoring goals, similarities to business are stronger than one may think.

Muscles and brains cannot be separated from each other. For professional athletes, peak performance is the result of rigorous training regimes and a state of mental readiness. Yet, other than in economics, mental preparation is not left at private discretion but is nurtured by mental coached, preparing athletes for the match. Mental readiness is understood as a critical factor, which is attended with thorough attention.

When it really matters, the framework for top executive performance is at its worst 

Stress factors, related to situations of rapid change, where the dynamics of the transformation keep accelerating and exceed the level of control of the management, are identified and can be categorized. Excess executive stress under distress and turmoil conditions is driven by four aspects.

  • Rapid and drastic changes in the work environment, including increased workload, changes in processes, style, and communication
  • Financial and legal concerns, caused by reduced payouts, fear of job loss, potential personal liabilities (et al.).
  • Emotional disruption, through continuous and repeatedly non-appreciating communication with various stakeholders, but also including disharmony in the intimate relationship.
  • Future worries, for reputational consequences, the continuation of the own career path etc…

Clustering the drivers for executive stress, most stress drivers are triggered by immediate and internal processes. The Board-of-Directors holds the authority, to establish a culture, voiding the most notorious stress drivers, to protect and retain executive performance in situations of rapid change. This can be a foundation for growth and sustainability.

A coach, allowing his team to be mentally distracted before the championship, will be fired on the spot! For a reason!

In situations of rapid change, higher levels of emotional stress and turmoil are suspected to be the differentiating element between the executive teams of firms in distress that must be liquidated and those, that manage to recover.

Capital markets are sensitive to the emotional well-being of the CEO already on a much lower level. Research has proven correlations between the emotional distraction of the experience of a recent divorce and the reactions of the capital markets.

In the 21st century, we are applying executive (self-)leadership of the 1800s

For once, let’s be honest: We all «kind of» know about the risks of Burn-out and the importance of mental health in the Executive world, yet, a stressful workday, permanent connectivity and late hours in the office are treated by many executives as “scares of honor“. Regrettable yet excusable liabilities to the family, the intimate relationship or the own, personal balance and well-being. For career frontlines, this is accepted as the price for success.

In parallel, Executive incentive systems are set up to foster the short term profitability of a firm, yet often fail to include mental balance of the executives in the considerations. It is fair to argue, high paid executives must observe their capabilities to perform themselves, yet, ignoring the relevance of mental balance for executive performance and focus on short term outcomes exclusively, can diminish the resilience of the organization.

In sports this would be equal to send the best player of the team to the match, whilst ignoring recent, previous injuries. Chances are: Small problems will cause bigger problems and end in negative outcomes when it really matters.

A small injury, left unattended, can prove being fatal in the final match.

The Good Coach

For the coach it is key to understand, performance levels vary even for top players. This can be due to daily performance variance, subject to dealing with legacy issues, or emotional burdens. In either case, the result of today’s match may be depending on high performance to be delivered to the point. To win the match the coach must exercise the right assessment of the status of the team and its key players.

For the Chairman, the ongoing monitoring of the capabilities of the executive team is at the core of her responsibilities in order to facilitate long term and sustainable growth and success and foster the resilience of the firm.

Executives are on top of the daily challenges and routines. Even on a “bad day“ they will perform on a sufficient level. Things can turn critical, if the tides are rising. It has been observed, companies, heading for growth and, firms exposed to disruption in the external environment, carry high risk of failure. Resilience is key for the executive team, to deal with situations of rapid change, where the dynamics of transformation keep accelerating and the level of control is diminishing. Here, executives need excess capabilities to control the situation and quickly adapt to a new reality.

For the chairman it is key to understand, if she has the right team in the game. Cheering and motivating, directing from the sideline, bringing in expert players for special situations but also making sure exhausted players rest, and bringing in fresh blood to the match are part of orchestrating a match.

Rigorous training leads to the championship

Success is not born on match day, but build up over the season.  Resilience and engagement on the executive level is the result of a process.

To the good, a healthy and well facilitated culture, regular executive education can build up a strong and capable team, able to take on turmoil and situations of rapid change; yet, to the bad, toxic work environments, unhealthy relationships, exhausting periods at work without rest etc. can deplete the resources of the executives and bring individuals close to a point, where breaking sooner or later is inevitable. A little increase in pressure, and the capabilities of the team can be exceeded.

Take away – game changer or playmaker?!

Understanding skills and current capabilities of the executive is at the heart of the chairman’s responsibilities.

Selection, succession planning, challenging, re-training, of the executive team – these are disciplines, easily agreeable to be mastered by the Non-Executive Board. Yet, there is more to it. Identifying and mentoring key players on different levels of the organization, assessing temporary downturns of individual performance and understanding trends vs. events is key to be able to facilitate sustainable success and build resilience throughout the organization. Also, creating a culture, which is aware and hedging for systematic stress drivers, the executive team is facing, specifically in situations of rapid change and moments of turmoil, is key to create value from the board and prepare an organization for rough times ahead.

Kolja A. Rafferty, MBA, IDP-C is an author, consultant and executive.  Kolja focuses on situations of rapid change, turmoil and economic distress. He is operating for Private Equity investors and Banks in Europe and the Middle East, helping to resolve distress situations in companies of different sizes and sectors.

First published here.

 

Women COVID leadership – The Head, the Heart and the Egos

By Helen Pitcher OBE, IDP-C, President of INSEAD Director Network, Experienced Chairman, NED and Board Committee Chair

When we look back at the ‘good the bad and the ugly’ of the Covid Crisis, there will be many lessons to be learnt and best practices reviewed to prepare for any future global pandemic.

Some will be very practical lessons such as the need for quick reactions on key activities like trace and isolation, social distancing and using protective masks.

Some will be structural, such as responding to early warning systems as in New Zealand, or quickly deployable and scalable testing and tracing as in Germany, or rapidly deployable ‘critical care’ hospital capacity as in the UK.

It is largely clear that the countries impacted severely by the earlier SARs local epidemic (it was not officially a pandemic) have sensitised their health systems and citizens to respond effectively to a global pandemic threat and learnt some of the hard lessons the ‘West’ is now encountering, but was initially more sceptical about.

The last globally declared pandemic was in 2009 and the World Health Organisation (WHO) was harshly criticized when this global flu pandemic turned out to be much less severe than people had feared. “Rather than feeling relieved the pandemic wasn’t causing large numbers of deaths, people felt aggrieved they’d been scared over something they later concluded was far less scary than expected” and “governments that had contracts to buy pandemic vaccine — contracts that were triggered by the WHO’s declaration — were left on the hook for a vaccine many people didn’t want.”

There will undoubtably be a whole raft of epidemiology insights and new models preparing for future pandemics, together with a large smattering of hindsight and blame to be apportioned, with Enquiries and Commissions galore.

An increasingly talked about issue, which will undoubtably be part of the post-Covid debate, is the role of female political leader during the crisis.  There will be debates over the consensual approach, holding sway in many female leaders’ domains, versus the ‘obey and just do it’ approach in some more authoritarian regimes, which have also proved successful in managing the disease growth.

It has been widely reported in the media that we have seen a cadre of female political leadership who have managed a more successful response to the crisis, keeping the spread and contagion low in their countries.  This often quoted ‘super seven’ of the ‘Nordic quartet’ of Erna Solberg of Norway, Sanna Marin of Finland, Mette Frederiksen of Denmark and Katrin Jakobsdottir of Iceland, together with New Zealand’s Jacinda Ardern and Taiwan’s Tsai Ing-wen is rounded off with the G20 member Angela Merkel of Germany. They are praised for their approaches which have encompassed a range of stereotypical ‘female traits’ of caring, empathy and collaboration, listening to a broad range of diverse views and communicating effectively with the public. These traits have been seen to build trust, transparency and accountability at a time of significant global confusion and panic.

Trust: the long serving Angela Merkel, the Chancellor of Germany, stood up early and calmly told her countrymen that this was a serious bug that would infect up to 70% of the population. “It’s serious,” she said, “take it seriously.” She did, so they did too.

Quick action: by Tsai Ing-wen in Taiwan. Back in January, at the first sign of a new illness, she introduced 124 measures to block the spread without having to resort to the lockdowns that have become common elsewhere.

Clarity and decisiveness: Jacinda Ardern in New Zealand was early to lockdown and crystal clear on the maximum level of alert she was putting the country under—and why. She imposed self-isolation on people entering New Zealand astonishingly early.

Using technology and social media: under the leadership of Prime Minister Katrín Jakobsdóttir Iceland offers free coronavirus testing to all its citizens, and instituted a thorough tracking system that meant they did not have to lock down or shut schools.  While Sanna Marin the world’s youngest head of state when elected in Finland, demonstrated the skills of a millennial leader in action, spearheading the use of social media influencers as key agents in battling the coronavirus crisis.

Compassion and innovation: Norway’s Prime Minister, Erna Solberg, used television to talk directly to her country’s children. She was building on the short, three-minute press conference that Danish Prime Minister Mette Frederiksen had held a couple of days earlier.

Their rarity as female political leaders with a social caring leadership style, has put these women in the spotlight in a sea of mediocrity and aggressive denial in facing the realities of the Covid crisis.

The analysis of their success is by no means complete and relies, by dint of their rarity, on a small sample of female leaders.  It is also, to use that beloved male sporting analogy ‘a game of two half’s’ with the economic impact as likely to cause significant hardship and distress as the contagion phase.  We can only hope that the characteristics shown by these women can carry through into the global economic stage, as the world seeks to work together to get the world economy and business working again.  The signs, however, are not great, with many of the male dominant G20 leaders seeming to be acting out that other standard from the male playbook of ‘last man standing’, with very self-interested and self-absorbed approaches.

It ironic that following the ‘Financial Crisis’ of 2008, the world was saved from another ‘Great Depression’, by the largely male dominated G7 Finance Ministers and Central Bank Governors ‘call to arms’, where they worked as one in concert and collaboration to inspire the G20 leaders to co-ordinate and stimulate the world economy to grow again.  Notwithstanding that they have much less room to manoeuvre this time, it is difficult at this point, to envisage a similar response from the current global leaders to this crisis, characterised as they are by blame and isolationist approaches, they look more like more subversives than saviours.

It is putting a significant burden on the German Chancellor Angela Merkel, as a key G7 leader, to spearhead this charge alone.  Perhaps the newly installed EU female leadership of Ursula von der Leyen as Head of the European Commission and Christine Lagarde as leader of the European Central Bank will add to the proceedings, especially as recent remarks by Christine Lagarde suggest she ‘buys in’ to the concept of caring collaborative female leaders making a difference.

What is clear is that one country alone is unlikely to re-ignite the global economy and it will take those characteristics of collaboration and communication demonstrated by the ‘super seven’ to see us safely through the ‘second half’ of the epidemic.

It is also clear that the adversarial political environments characterised by many of our major economies is less conducive to a collaborative consensus approach, whoever is in charge.  It is noteworthy that the majority of the ‘super seven’ have developed and grown in cultures which are more socially orientated with consensus-based politics of coalitions, where compromise and diversity of thinking and inclusion are to the fore.

While the case for women leaders is at this stage more anecdotal than data driven, we can only hope that more women are energised and inspired by the ‘super seven’ to step forward to make a difference and join into the political leadership process.

However, the shift to a less adversarial political process from the “winner takes all approach,” is challenging and problematic, with too many political parties, and backers still focused on getting women to behave more like men if they want to lead or succeed.  As articulated by Alice Evans a sociologist at King’s College London who studies how women gain power in public life, this can be difficult for women to meet as “There is an expectation that leaders should be aggressive and forward and domineering. But if women demonstrate those traits, then they’re seen as unfeminine” “That makes it very difficult for women to thrive as leaders.”

As we address more global issues, a consensus style of leadership will become increasingly valuable, with global threats from climate change escalating, creating more ‘natural crisis,’ together with an almost certain greater sensitivity to pandemics.  These types of issues cannot be dominated and cowered into submission, they do not respond to the “classic self-obsessed leadership projection of power, acting aggressively and showing no fear.”

These role models of strong female leaders succeeding in a global crisis, send out a strong message to all political leaders.  With their success their political status has, grown with their characteristics of curiosity, humility, empathy, and integrity, becoming a benchmark of effective political leadership.

Article first shared here.