“The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic.”
By any standards 2024 has been a tumultuous year both in Corporate and Public worlds. With major shifts and changes in the Political Landscape continuing to ripple through the Globe, there are inevitably impacts on the Business World. While we can anticipate some re-orientation and disorientation on some themes and targets such as energy and DEI which have emerged in 2024, Business should continue the focus on the existing underlying Consumer and Governance trends.
During 2024 we have seen the emergence of a number of Consumer-Governance themes which are important to note.
Authentic ESG:
We have seen in 2024 the continued rise of the Sustainability and ESG panorama. However, there has also been a notable counter balancing theme, at the Political level with ‘Trump scepticisms’, and at the Consumer level with concerns on the depth of the real shift in the Corporate Business Agendas. Both the US and EU regulators have mandated Boards to respond more effectively to Consumer and Investor concerns around the environment. The ESG agenda is not going away. Boards will be required to pay more than ‘lip service’ to ESG concerns. Boards and Businesses need to demonstrate fundamental changes to their Business Operations and not just be seen to ‘market’ their ESG credential with ‘green washing’ and ‘social washing’. Consequently, Boards need to ‘up their game’ and understand the fundamental shift in Consumer and Investor positions by ensuring they are embedding change into the Organisation and not just issuing ‘Board edicts’, they need to increasingly develop effective Board reporting against meaningful targets and milestones.
Back in July 2022 I discussed in a podcast ‘Some of the challenges of Creating Future Ready Boards including ESG’.
https://www.abexcellence.com/articles-list/future-ready-boards-helen-pitcher-obe.
AI Transformation:
2024 has seen AI burst into the Public and Business perception. We are daily bombarded with the brave new World and the game changing activities of AI. Fortunately, while the excitement of new developments continues at a pace, there is also a strong realisation of the implications of this Emerging World. This has stimulated discussion and debate at Governmental, Corporate and Consumer levels. While the potential benefits of AI are widespread, Boards must react quickly and not get swamped by the ‘newness’ of the Technology. They need to become both informed and educated as to this potential for their Businesses and understand the most effective ways to maintain appropriate Governance and control of AI environments, before the robots turn up at the Boardroom door.
In an article in 2024 I discussed some of the challenges for a Board in focusing on the Technology-Digital Transformation ‘AI and The Board, a Take-Over or Liberation?’.
https://www.abexcellence.com/articles-list/preparing-boards-for-change
Diversity Equality Inclusion and Identity Politics:
There has been boisterous and often noisy debate on DEI and Identity Politics in 2024. Many in the corporate world have been at the ‘woke’ forefront of the policy implementation drive. We are now seeing a ‘backlash’ as Consumers and Investors react to the more extreme iterations of the supporting policies. Boards are starting to take a more focused approach and ensure that the core values of their DEI policies are relevant and effective for their Businesses from both a Consumer and employee viewpoint. There is a greater practical focus on making sure that Businesses take advantage of all the talents and resources available to it. The Corporate World has seen one of its long-held DEI policies on gender equality in the Boardroom hit the 40% target in the FTSE 350. Also Executive Leadership equality is heading in the right direction in the FTSE 350, with female participation at 35% across the Leadership cadre and at 28% on the Business Executive Committee. This in turn, however, has illuminated a glaring gap at the CEO level, where only 9% of the FTSE 350 are led by women. I discuss some of the ways to remedy this significant anomaly in a recent Coaching Series Article in December, ‘Infinity and Beyond, Women into the C-suite’.
https://www.abexcellence.com/articles-list/infinity-and-beyond-women
Distant and Remote working:
A practice that was essential during the pandemic is now the topic of hot debate, doubtless this will continue well into 2025.
Other 2024 themes:
Other themes which gained some traction in 2024, range across Leadership, Resilience of Supply Chains and Pensions.
There is an emerging generational shift in Leadership capability and engagement, with employees motivated by a sense of shared mission and values. There is an expectation of Authentic Leadership which walks the talk, gives greater autonomy in decision-making processes, delivers well-being programs and mental health support to ensure that the workforce remains productive, happy, and engaged.
We have also seen increasing discussion and debate during 2024 on Business Resilience and the Supply Chain. With threats around every corner Boards need to take a proactive and strategic approach to their Supply Chains resilience and the potential impacts on their Business. The days of ‘its cheaper’ are being challenged by the notion of ‘is it secure’. This is especially important as Customer Service and reliability starts to reassert itself under the competitive pressure from Intelligent and AI systems.
Finally, in the latter half of the year the discussions and chatter around Pensions has exploded ignited by the Budget. As a daily news item and topic of conversation it has drawn attention to a previously rarely noticed area. Pensions, funding and investment will be an ongoing topic for employees and Boards as they respond and navigate an increasingly chaotic Landscape. There will be keener focus on Where is my Pension? What is it being invested in? and What will be the returns?. Whether this will be sustained and lead to a greater consumer activism around pension investments remains to be seen.
From a chaotic 12 month the role of the Board and NEDs has emerged as a fundamental guiding light to the Business seeking to establish appropriate Governance and Strategic focus. The best-in-class NEDs can provide meaningful experience, insight and foresight on the way ahead.
