Entrepreneur & Innovation Exchange Published online at FamilyBusiness.org on April 09 2020 DOI: 10.32617/492-5e8efc673ed09 COVID-19: Understanding the Board’s Key Role During a Crisis Joseph Astrachan (SC Johnson College of Business) Andrew Keyt Hermut Kormann (Zeppelin University) Claudia Binz Astrachan (Lucerne University of Applied Sciences and Arts) KEYWORDS: crisis management, Board of directors, Governance. A board’s oversight and guidance, based on the expertise, experience and personal qualities of its members, has always helped drive business success and survival. But now, as the COVID-19 pandemic shakes societies and economies around the globe, boards play an even more critical role. Companies that can tap their boards’ crisis mitigation skills will likely have an edge over companies whose owners don't recognize the board’s potential or can't encourage board members to step up. For family businesses with many shareholders, the board’s role is especially critical. The board can help build and preserve family commitment and continuity when tough decisions must be made. It can be a trusted expert about future prospects and difficult but necessary changes, and a respected arbiter of the many tradeoffs between family benefits and business survival and prosperity. The calming influence of the board can steer the family away from destructive behaviors that undermine the family and the business: emotional outbursts, inappropriate attempts to influence others, and more. Lastly, their impact can be long-lived if they serve as mentors to family business leaders and employees, and help them reflect on how they've handled and learned from difficult times. The current pandemic is unprecedented in its impact. Companies must simultaneously think outside the box, develop a variety of plans that adequately respond to different scenarios, and use what they have effectively. This article describes the board’s responsibilities in this current environment and proposes some ways that family businesses can leverage their board to help both the family and the business during a crisis. First Things First: Setting the Frame An important first step, and one that requires the voice of all board members, is to define the assumptions under which people in the organization should plan and execute the measures proposed. These basic assumptions help family members understand what the business must do and the expected outcome, and will affect family commitment and cohesion. Duration & Extent The board agrees on their assessment (ideally based on reliable data and expert opinions) of how long the crisis will last (e.g., six, 12, or 18 months)? The board agrees on their assessment of the assumed shape of the curve (again, ideally based on reliable predictions) of the impact. This means plotting out when the crisis will peak, whether it will peak once or more, how much time will be in between peaks, when recovery can be expected, and how the company will prepare for all of it. The board acknowledges the reality of “delayed effect,” which is a basic law of firefighting: The flames you see in this very moment are those that originated half an hour ago, and the fire an hour from now is exponentially worse. Business Model The board evaluates whether a radical change in how business is done is needed in order to survive (e.g.,changing the customer base from restaurants to individual customers or a channel Copyright © 2020 The Authors. Entrepreneur & Innovation Exchange is published at EIX.org. This is an open access article under the terms of the Creative Commons Attribution-NoDerivs License, which permits use and distribution in any medium, provided the original work is properly cited and no modifications or adaptations are made. View EIX.org Authorship Terms at https://eix.org/terms