Jean Pousson, our Managing Director, reflects on a pandemic-influenced year and provides some insights for Directors for 2022.
2021 will be remembered as the year when the world made progress against the deadly Covid 19. It has also been the year where we have witnessed rising inflation, supply chain shocks, labour shortages, hybrid working, energy spikes, TikTok, and the continued emergence of Tech Companies through many aspects of our lives.
Office suits made way for pyjamas as dress codes, and one wonders whether the necktie and the business card will ever recover. There have been some unintended beneficiaries of this forced isolation though. Christian Churches have recorded much increased attendance via online platforms. And it was also the year that Chelsea FC won the European Champions League. (Sorry! Simply could not resist.
But what of 2022? We are all learning and adjusting, (still). And just like when the pandemic struck, there are no blueprints. Just constant trial and error. I have yet to see a Professor Covid 19 at any recognised Business School. It will come, I’m sure.
The Office. I wonder what David Brent, (ie Ricky Gervais of the fabulous TV series), would have made of home/hybrid working. There has to be enough material there for a comeback series. The future of work has changed forever. Presenteeism has entered the business vocabulary, ie the need to be seen by the boss. Working from home will make me less visible. Will that affect my career prospects? What about networking? Will I be penalised for working from home?
We are all adjusting to these new realities and Directors should tread with caution and not enforce a, “let’s go back to the way it was”. A key capability of any Director or Manager has always been the ability to learn and unlearn. As we have said many times before, “experience is great as long as the future resembles the past”. Executives who have been successful in an office environment are perhaps the least qualified to offer advice and guidance. Employment Law will certainly have to be adapted, and HR specialists need to consider what type of boss will best suit this new environment.
The planet has a crash course in e-commerce. Tech Companies will continue to exert their influence and extend their capabilities to digital finance, digital currencies, and in time financial audits. Markets always move first, and Regulators always struggle to play catch up. A question we always ask Boards with whom we work is this, “is the voice of technology heard sufficiently strongly at Board level?” “How confident are you of your technological capabilities?” A strong Balance Sheet is no good if your business model suddenly becomes obsolete.
Supply chain issues have questioned the globalisation model of sourcing components from all over the world. New and different risks have emerged in so many areas and Boards would do well to re-examine their risk management processes to make sure that the process is still fit for purpose. “Reflecting on the last 18 months or so, what has surprised you? And, more importantly, should you have been surprised?” Please do have that discussion on a regular basis.
Innovation. What the pandemic has taught us is that barriers which we thought existed, be it regulatory, cultural, procedural etc, were largely overhyped. You will never have a better opportunity to innovate and try out new things. In truth, if you cannot innovate now, when will you be able to!
Esg considerations will, quite rightly, occupy more and more of the Board’s time. It is one thing to evangelise and to take a position, but quite another to make tough decisions. There is a huge fog of confusion and conflicting language on this. Boards need to understand the risks to their organisations of not moving too quickly or not moving at all. Climate risk means just that, and investors and, more importantly financiers, will have more of a say. Too often polluters have no incentives to change and CEO’s who make ambitious statements of intent will not be around to witness performance. Esg is often associated 100% with climate change and related activities. Although no-one disputes this, please do not forget the g in esg!
When business and ethics collide. 2022 will see the Winter Olympics in Beijing and the Football World Cup in Qatar. I am always keen to observe executives who claim the moral high ground but nevertheless enjoy these sporting spectacles. This is just an example to make the point that values are only purposeful if followed through with hard actions. We shall see. We firmly believe that values drive value.
Every year I thoroughly enjoy Fortune Magazine’s ‘World Most Admired Companies Survey’, which usually comes out in the first half of the year. It will be interesting to see if the criteria have changed for 2022.
We, at BEL, would like to wish you and your loved ones
a very Happy and Peaceful Holiday Season
and a very rewarding 2022.
And above all, stay safe!