Crisis preparedness and response

November 2017

Natural disasters, product and service failures, cyber attacks, revelations of corporate malfeasance, the sudden loss of a CEO: public companies face no shortage of potential crises. If poorly handled, a crisis can lead to significant destruction of value in the form of direct expenses, lost revenue, declining market value, and a tarnished corporate reputation. The direct personal impact on executives and boards can be severe as well; as a result of recent crises at Target, Wells Fargo, and Equifax, among others, CEOs and other executives lost their jobs, and investors and, in some cases, regulators have called for board members to lose their seats as well.

Members of the Lead Director Network (LDN) and their general counsel (GC) guests met on October 24, 2017 in Washington to discuss the roles of the board and the GC in detecting, avoiding, and responding to a crisis. This ViewPoints synthesizes that discussion. A companion ViewPoints synthesizes another discussion at the meeting related to shareholder activism.