Indian economy is going down in an unprecedented manner, creating absolute uncertainty for the future. Similarly, several corporates are facing a plunge in the revenues in proportion with the speed of the spread of the deadly virus. Amid such a time, eminent corporate lawyer and entrepreneur -- Gautam Khaitan suggests the board of directors to lead from the front in such a crisis to survive business disquietude.

Conducting Comprehensive Assessment

“The first thing the board must do is to identify possible risks emerging from the pandemic and to ensure the well being of the workforce and the stakeholders,” says Khaitan. He suggests the board to analyze the impact of the pandemic on the operations of the firm (productivity, quality, quantity, and the overall supply chain management) and the legality involved if there are any deviations and disruptions in the operations.

Finances are the backbone of any organization, an integral part of running a business. In such a time when businesses are facing a severe cash crunch, “the board must conduct frequent briefings about the financial health of their business. It involves working on the liquidity needs, indebtedness, lines of credit,” he added.

Proactive Discussions

“Proactive mode of communication with the stakeholders, regulatory and other agencies can help in easing the compliances in such extraordinary difficult situations,” says Khaitan. Frequent discussions can result in evading the loss of exploiting opportunities in adverse situations.

“Active communication between the CEO, CFO, and other office bearers will result in utilizing the best out of the limited resources especially when the physical movement of the people is restricted”. Board members have long experience of successfully running a business, frequent discussions can positively impact the functioning of the business positively.

Legal Issues

Legal compliance can prove to be a bone in the throat if they are overlooked frequently. “In the light of the prevailing conditions, compliances such as mandatory disclosures under SEBI, contractual issues involving force majeure and frustration of contracts, it becomes the responsibility of the board of directors to ensure such issues are not ignored. They must ensure that the company does not adopt any adversarial strategy to mitigate short term issues resulting in straining long-term relations,” he suggested.

Corporates in India form the great chunk of the economy employing millions. Successful running of the businesses is the solution to restoring the nation’s progressive economy on the track. Right leadership amid such difficult time cannot only navigate the organisation through choppy water but can bring fortunes.