Press "Enter" to skip to content

Considerations for corporate boards in the post pandemic world

The world is today actively pushing for sustainable and inclusive growth on the heels of the unprecedented disruption occasioned by the COVID-19 pandemic. The road to recovery has been slow.

Businesses are reevaluating their processes and procedures to better position to compete in the world that the pandemic created. Remote work, increasing use of digital technology, and new risk assessment and management are the order of the day.

The bulk stops at the door of the Board of Directors. Directors are thus faced with a plethora of concerns, primarily, ensuring the company is a going concern, the effectiveness of the board and management, and charting a course for the future, both near and far all within the constrain of the new business environment.

The Board therefore should be composed of an appropriate balance of expertise, knowledge, and experience needed to lead post-pandemic, review the company’s overall situation, discuss lessons learnt, including how the business was disrupted, and how to minimize business and governance exposure in case of future occurrences.

Nevertheless, what competencies do a director need to be effective? Do all board members bring valuable skills, experience, and expertise to the board? There is no simple answer to these questions. It depends on factors such as the organization’s industry, the regulatory environment, the business model, and the capabilities of the CEO and management team.  But while there is no easy answer to such questions, we have highlighted competencies that should be represented across all corporate boards, they include:

Risk Management: The unprecedented Covid-19 pandemic will require companies to immediately reassess risks, respective processes, and controls. Directors must be able to exercise oversight over the process for the identification and assessment of risks, as well, as recommend prevention and detection mechanisms.

Strategy: Boards would be expected to review their strategies to identify possible vulnerabilities. Once concerns are identified, directors need to evaluate how to address them, whilst also bearing in mind the stakeholders’ best interests. This is a skill that must be prioritized on boards.

Digital-Savviness: On a global scale, many companies have been forced to quickly change their way of working, adapting to a digital world. Preparing for such a change should begin with assembling a digitally savvy board.  This ‘digital savviness’ will entail knowledgeable use of electronic tools, oversight over the digital product and an understanding of the impact that digital technology will have on the business’s success over the next decade.

The composition of boards varies across industries. Consequently, the following sectors have been apportioned with streamlined governance considerations.


Corporate bank boards should consider:

Risk Management: Bank boards must be knowledgeable and experienced with sophisticated risk management models and methods, especially for credit risk. This is so, as financial stability is expected to decline due to changes in the risk profile of borrowers/facilities.


Insurance boards should strategize on:

–   Strain on investment portfolios: Insurers’ investment portfolios may be significantly impacted because of the consistent bearish trend of international and local markets.

–   Decreased premium volume: Lower payroll levels lead to lower payroll-based premiums, such as those in workers’ compensation, and an uptick in layoffs results in fewer people buying houses, cars, and other insurable purchases. Therefore, a decrease in premium volume means a decrease in income for insurers.


A large proportion of private fintech firms are less than ten years old and facing their first market downturn. Many corporate boards may be inexperienced in responding to difficult business conditions – weak customer demand, and working capital squeeze. The following should be taken into consideration as pertinent to the effectiveness of the board. They include:

1) Business transformation strategy: The flexibility in business models and the ability to dial up or dial-down costs will become critical and will determine which firms survive. Companies with recurring revenue and long-term contracts will be impacted less than firms with transaction-based business models, while consumer-oriented B2C Fintech (e.g. Challenger Banks) will see business performance contracts faster than B2B models.

2) Corporate Restructuring: According to a report by Rosenblatt Securities, there is a likely deterioration in fintech operating performance during a deep downturn, as funding sources evaporate and exit options change significantly.  The report states that these forces may feed off each other, creating a vicious cycle where deteriorating business performance makes funding more difficult and vice versa, should the market downturn last long. This reduced funding for FinTechs could force firms to seek collaboration, investment, or acquisition by traditional financial institutions.

The proverbial ‘thinking outside the box’ should now be the norm for boards that wish to remain relevant and in business. It is our concerted opinion that corporate boards need to undertake a board skill and Governance framework analysis, which is effective in cases where replacing the current membership is not an immediate option. When a board has knowledge of its deficiencies and works to address the gap, it will go a long way towards board and management effectiveness and ensuring business sustainability.

Chioma Mordi is the MD/CEO

About The Society for Corporate Governance Nigeria

SCGN is a registered not-for-profit organization committed to the development of corporate governance best practices in Nigeria. Today, the Society is the foremost institution committed to the development and promotion of corporate governance best practices in Nigeria. [email protected]

... Considerations for corporate boards in ... pandemic world Read More on ... Naijaonpoint.



Spread the love