Senior Client Partner, Head of the Board Effectiveness Practice
Leadership
When the Boardroom Becomes a War Room
Amid trade wars, pressure from activist investors, and economic uncertainty, boards are taking on a new role.
April 28, 2025
Amid Trade Wars, Pressure from Activist Investors, and Economic Uncertainty, Boards are Taking on a New Role
The group of directors were meeting—but without the usual agenda. Off the table: discussions of long-term succession, the latest on compensation, and how to comply with new regulations. On the table: scenario planning for tariffs, workforce restructuring amid economic uncertainty, and navigating challenges from activist investors.
As the world has changed drastically in recent months, so has the way at least some boards are meeting. Experts say we’ve entered a new age of the board “war room,” or scenario planning. Indeed, the speed with which directors are having to make decisions has jumped sharply, forcing many to take part in an increased number of urgent calls and informal touchpoints with both their peers and executives. “Management and the board have to be tied at the hip,” says Radhika Papandreou, president of North America at Korn Ferry and a member of the CEO and Board Services practice. “Directors are leaning into the global perspective and spending a lot of time on scenario planning.”
According to a recent field survey by the National Association of Corporate Directors, an unsurprising 75% of respondents said the top issue on a board’s agenda is shifting economic conditions (typically only 43% to 58% cite this topic). Respondents also rated geopolitical volatility (46%) and political risk (41%) as hot-button issues for boards in the upcoming quarter. “It’s hard for directors to tell if the current economy is a blip or a new normal,” says Jane Edison Stevenson, global vice chair of Korn Ferry’s Board and CEO Services practice.
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To be sure, this isn’t an entirely new development for boards. A record increase in shareholder activism last year forced many to hold special meetings, chiefly to discuss how to communicate effectively with stakeholders, investors, and employees. Companies with seasoned CEOs and CFOs who have weathered previous downturns have a leg up in the current environment, experts say, particularly since an unprecedented number of incoming leaders last year were first-timers. Veterans of volatile market environments understand the importance of increasing the level of communication while running a war room.
Many directors also took part in urgent meetings during the COVID-19 pandemic. At the time, they increased their overall time commitment by nearly 20%, one survey found. But the challenge for directors remains the same: to maintain their role as advisors—not act as day-to-day leaders. Directors need to have “a cool head and not add to the drama,” says Anthony Goodman, leader of Korn Ferry’s North American Board Effectiveness practice. “They need to remember they’re not running the company, but providing challenge, support, and guidance.”
Find out more about how boards and leaders are handling today’s volatility by exploring our leadership topics hub.
Key takeaways
- Why 75% of directors say shifting economic conditions will dominate boardroom agendas for the next quarter
- The reasons behind why boards are spending a significant amount of time on scenario planning and meeting more frequently
- Why veterans of volatility may fare better in the current environment
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