Year Two of the coronavirus pandemic sees uneven and fragile economic recovery in the United States and broader global community. While Chief Executive Magazine recently reported US CEO confidence in future business conditions at a two-year high, leaders in both profit and mission-based organizations continue to face daunting fiscal and operational challenges.
In this Reset 2021 article I will address three priority areas that leaders and the boards that oversee them are talking about now and that require ongoing “protect and correct” attention and action.
The three areas are Organizational Reputation, Human Capital and Cybersecurity.
Often discussed within the framework of Environmental, Social and Governance (ESG) issues and regulation, these areas are discrete but interlinking business dimensions that need to be high on the senior executive team’s 2021 “protect and correct” agenda. Why? Because the prolonged global socio-economic dislocations wrought by the COVID-19 pandemic, combined with a low trust stakeholder ecosystem, and disruptive, next generation digital technologies all contribute to heightened business and management risk.
LEADER PRIORITY: ORGANIZATIONAL REPUTATION
Warren Buffett famously said, “It takes 20 years to build a reputation and five minutes to ruin it.” Add to this timeless observation the fact that leaders today must navigate in what has become a very low trust ecosystem. The credibility of societal leaders declined overall in the past year, according to the Edelman Trust Barometer 2021 Global Report, with CEO credibility at a middling 48 percent trust level. Additionally, the “infodemic” of misinformation and false narratives that continues to proliferate across news, social media and workplace platforms requires extra vigilance and quick action to reduce reputational damage. Heightened stakeholder expectations around social responsibility issues also contribute to reputational value and risk.
By way of recent news headline examples, consider the cases of Dominion Voting Systems and Smartmatic, both companies on the receiving end of infodemic damage. McKinsey & Company and Apollo Global Management are lessons in how “the company you keep” scandals can prove costly to organizational reputation and the bottom line.
Protect and Correct Action Checklist
- Leader behavior that exemplifies high personal and professional standards, conduct and accountability.
- Prepared crisis communication plans for high-risk scenarios, including specific staffing and messaging assignments.
- Clear employee policies about appropriate use of workplace communication channels.
- Rigorous vetting of potential business relationships – clients, vendors, strategic partners, investors – to insure alignment with organizational values as well as regulatory compliance.
- Rapid resolution of issues that involve public welfare or misperceptions.
- Legal action as per expert opinion and counsel.
LEADER PRIORITY: HUMAN CAPITAL
[Next up. Coming soon]
Copyright Susan Battley. All rights reserved.