During times of crisis or uncertainty, directors have an integral role to play in ensuring that the organisations they lead effectively implement governance and risk models that can react to changing environments.
Boards can and should help to build an organisation better able to absorb the shocks from operational risks and balance sheet blows that arise from events like pandemics, natural disasters, regulatory change, cyber incidents, technology failures and changing community expectations.
If the current COVID-19 pandemic has taught corporate Australia anything, it is the limited value of ‘prediction’. Few could have foreseen this time last year that our economy would shrink by an extraordinary 7 per cent in the three months to June 2020 — the biggest collapse since the Bureau of Statistics began compiling records. Nor could many have predicted that, in order to save our economy from a worse result, the Federal Government would ‘leave ideology at the door’ and introduce an unprecedented level of government support — more than $100 billion in JobKeeper and expanded JobSeeker payments alone, enough to actually lift some household incomes even while some 643,000 Australians lost their jobs.