28 May 2020, Bengaluru: The Centre for Corporate Governance and Citizenship (CCGC) at IIM Bangalore held the Chairmen’s Roundtable webinar on ‘How Boards will balance shareholders and stakeholders interests in the post COVID era’ on May 27, 2020. Suresh Narayanan, CMD, Nestle India Ltd, Sunil Munjal, Chairman, Hero Enterprise, and R Seshsayee, Former Chairman Infosys Ltd and IndusInd Bank and Corporate Director & Advisor, Hinduja Group, were invited as speakers at the panel discussion moderated by Prof. S Raghunath, Chair – CCGC at IIMB.
Prof. S Raghunath set the tone of the conversation by stating that Boards are expected to act as the oversight body for value creation and value appropriation in corporate entities. “From a long term perspective, the corporate objective, by and large, has been the generation of sustainable shareholder value. However, when we consider the context of the COVID ravaged industry context, the aftermath has disrupted the value chain and has brought stakeholder concerns, both internal and external into sharper focus while pursuing shareholder value,” he said.
While emphasising on how Boards should focus on core values, R Seshsayee mentioned, “Firstly, it should be in terms of how we deal with people and processes – a fundamental re-examination of values espoused by the Board and the linkage with the values of the society at large. Secondly, a heightened awareness of risks and risk management becomes more critical now. While we have seen a pandemic as a risk, there could also be a technology risk—something that completely immobilises communication. For example, we would now be examining the issue of cybersecurity in board discussions.”
Sunil Kant Munjal pointed out that the role of Boards is going to be of a higher order of responsibility for sure in the future that encompasses environmental concerns and the principle of doing good while doing well. He added, “Even the most conservative businesses need to understand that they will have to use the technology; otherwise they would be left behind, and the market will get brutal in terms of competitiveness. Indian businesses have to be competitive as anywhere else in the world as a global outlook is necessary. We cannot stop information/data, but we can build a wall around the physical movement of people/goods. It will be disruptive, and the direction we are following now is headed for built-in conflicts. So boards of organisation of every size must play an active role in aligning themselves to each other, to the national goals and also the global goals while continuing the laser-sharp focus on efficiency and productivity.”
The discussion followed concluding remarks by Suresh Narayanan, who explained that the Boards need to consider 3 Cs: Culture, Competence and Competitiveness. “The company culture and ways of working—these need a close examination in the COVID-19 era because we have seen aspects of culture which worked and not, during this crisis and what made a company stand on its feet and what made it fall flat on its face; that’s where the culture and way of working help,” he continued.
Elaborating the 3 Cs further, Suresh said, “Competence is of both the leadership and organisation; the capability that it has, whether the company is ready to take on future challenges. Competitiveness is whether the business will witness sunset or sunrise; if it will be a new reality or otherwise—it depends on which of these the company is aspiring. And, culture, competence and competitiveness are what the Board should be tracking and looking at progressively.”
28 May 2020, Bengaluru: The Centre for Corporate Governance and Citizenship (CCGC) at IIM Bangalore held the Chairmen’s Roundtable webinar on ‘How Boards will balance shareholders and stakeholders interests in the post COVID era’ on May 27, 2020. Suresh Narayanan, CMD, Nestle India Ltd, Sunil Munjal, Chairman, Hero Enterprise, and R Seshsayee, Former Chairman Infosys Ltd and IndusInd Bank and Corporate Director & Advisor, Hinduja Group, were invited as speakers at the panel discussion moderated by Prof. S Raghunath, Chair – CCGC at IIMB.
Prof. S Raghunath set the tone of the conversation by stating that Boards are expected to act as the oversight body for value creation and value appropriation in corporate entities. “From a long term perspective, the corporate objective, by and large, has been the generation of sustainable shareholder value. However, when we consider the context of the COVID ravaged industry context, the aftermath has disrupted the value chain and has brought stakeholder concerns, both internal and external into sharper focus while pursuing shareholder value,” he said.
While emphasising on how Boards should focus on core values, R Seshsayee mentioned, “Firstly, it should be in terms of how we deal with people and processes – a fundamental re-examination of values espoused by the Board and the linkage with the values of the society at large. Secondly, a heightened awareness of risks and risk management becomes more critical now. While we have seen a pandemic as a risk, there could also be a technology risk—something that completely immobilises communication. For example, we would now be examining the issue of cybersecurity in board discussions.”
Sunil Kant Munjal pointed out that the role of Boards is going to be of a higher order of responsibility for sure in the future that encompasses environmental concerns and the principle of doing good while doing well. He added, “Even the most conservative businesses need to understand that they will have to use the technology; otherwise they would be left behind, and the market will get brutal in terms of competitiveness. Indian businesses have to be competitive as anywhere else in the world as a global outlook is necessary. We cannot stop information/data, but we can build a wall around the physical movement of people/goods. It will be disruptive, and the direction we are following now is headed for built-in conflicts. So boards of organisation of every size must play an active role in aligning themselves to each other, to the national goals and also the global goals while continuing the laser-sharp focus on efficiency and productivity.”
The discussion followed concluding remarks by Suresh Narayanan, who explained that the Boards need to consider 3 Cs: Culture, Competence and Competitiveness. “The company culture and ways of working—these need a close examination in the COVID-19 era because we have seen aspects of culture which worked and not, during this crisis and what made a company stand on its feet and what made it fall flat on its face; that’s where the culture and way of working help,” he continued.
Elaborating the 3 Cs further, Suresh said, “Competence is of both the leadership and organisation; the capability that it has, whether the company is ready to take on future challenges. Competitiveness is whether the business will witness sunset or sunrise; if it will be a new reality or otherwise—it depends on which of these the company is aspiring. And, culture, competence and competitiveness are what the Board should be tracking and looking at progressively.”