Companies under stress have to take more risks – that’s the nature of business.
This stress creates a bigger challenge for senior leaders on the Board and in the C-suite to govern that risk. Risks, both intended and unintended, increase. Resources to manage those risks decrease or are spread thinner. Leaders cannot be paralyzed by these risks; if they are, their companies will not survive.
The companies that succeed are the ones who adapt, not abandon, their risk governance. Under stress, how do leaders make sure they are making the right business decisions? How do they make sure they are sending the right risk signals? How do they identify the on-the-ground risks before it’s too late? These questions are not academic; they have real business, ethical, and, in some parts of the world, legal implications for senior leaders. There are no easy answers, but there are lessons to be learned and applied.