Expecting the unexpected

How should the board respond in a crisis?

In recent years we’ve seen the definition of a crisis broaden from total business disruption – a natural disaster, an unwelcome takeover, a major customer issue or a cyber attack – to matters of reputational risk. Crises stemming from reputational threats can arise from a wide range of less obvious, internal and external issues - and for this reason, are often more difficult to anticipate. In our global village with 24/7 digital news and social media, every board should be prepared for the unexpected. As a director, it’s important to know that the company has protocols to deal with a crisis situation. But not all crises are alike. So how does a board ensure they’re notified of different risks on a timely basis - including less obvious ones? How does a board adapt a crisis response plan for different issues? What is the first thing that the Chair should do? What is the board’s expectation of management?

At our PwC New Zealand NED Programme event on 17 September 2018, we explored some of these challenging scenarios that boards can face. We focused on two scenarios deriving insights with broader application across a wide range of potential disruptive business events. We were fortunate to have a strong line up of senior directors and experts to help lead the discussion, sharing their experience and insights under each scenario.

Scenario #1: Responding to an unexpected commercial disruption (eg. an unsolicited takeover offer)
Andrew Harmos (Partner, Harmos Horton Lusk), Carl Blanchard (PwC Partner and Deputy Chair Takeovers Panel NZ) and Trevor Janes (Chair, Abano Healthcare Group)

Scenario #2: Responding to an environmental disruption (eg. a fire or natural disaster)
Fran O'Sullivan (Business Columnist, NZ Herald), Mark Cairns (CEO, Port of Tauranga), Rob Campbell (Chair, Tourism Holdings), Simon Allen (Chair, NZ Refining) and Stacey Shortall (Partner, Minter Ellison Rudd Watts. Stacey was advisor to the Pike River management). 

A common element discussed under both scenarios was the need to be well prepared - having a sound and concise crisis management plan that is easily understood and reviewed regularly, even taking the time for simulation exercises. You'll find an overview of key event insights in our brief video. The PwC study How your board can be ready for a crisis also features valuable insights on this topic.

To explore related insights for boards, please feel free to connect with David Bridgman or Michele Embling.

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expecting-the-unexpected

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Michele Embling

Michele Embling

Chair, PwC New Zealand

Tel: +64 21 807 728

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