COVID-19: potential liabilities and risk management for directors and officers
Clyde & Co
In the current situation it is inevitable that director and officer (D&O) claims will arise, although the ultimate exposure remains to be seen. Clyde & Co have summarised some of the risks and considerations they should be taking into account.
A selection of risks and related management considerations is provided below, follow the link for more detail on these risks and others, including cybersecurity and health & safety.
Shareholder derivative claims
- Hold regular meetings/briefings on the coronavirus crisis and take detailed minutes of decisions and action plans.
- Continually review contingency and operational resilience plans and update as necessary as the situation develops.
- Consider what internal or external resources may need to be brought in to help keep the board informed.
- Consider carefully what disclosures you might need to include in your year-end accounts relating to these events.
- Consider whether to refer to the possible impact of COVID-19 on your business in your reporting of principal risks and uncertainties.
- Where mitigating actions can be taken, these should also be reported alongside the description of the risk itself.
- Monitor developments and ensure the provision of up-to-date and meaningful disclosure.
- Keep detailed records of decisions and action plans.
- Similar considerations apply to regulatory exposures as to investor.
- Be prepared to explain and justify your contingency and operational resilience plans to regulators.
- Where FCA-regulated firms do not have an individual performing the SMF24 function, it will be for a firm to have determined the most appropriate person within the firm, who will be accountable for operational resilience.
A six-step plan to get ROI from AI
Boston Consulting Group
The experience of AI pioneers suggests six moves that separate the winners from the rest:
- Integrate AI into business strategy: What are your business objectives and how can AI help you meet them? Zero in on the initiatives with the highest potential impact.
- Prioritize revenue growth over cost reduction: AI can cut costs, and quick wins can spark enthusiasm. But the greatest value will be from revenue and growth, embedding AI more deeply into the business.
- Take bigger risks to achieve greater impact: More companies that invest in large, high-risk initiatives see value than those focused on low- risk projects—50% versus 23%. But such risks should be part of a calculated business strategy.
- Align AI development with its usage: AI should be designed collaboratively with business and process owners. It’s 10% about algorithms, 20% about technology, and 70% about business application.
- Treat AI as a business transformation: AI initiatives shouldn’t exist in isolation. Among companies generating value from AI, 88% tightly link their efforts to companywide digital transformation.
- Invest in AI talent, governance, and process change: Investing in recruiting, reskilling, and training increases the odds of seeing results from AI—as does embracing agile and robust data platforms and governance.
Economic crisis: how deep and how long?
McKinsey & Company
The statistics to measure the impact of coronavirus are arriving.
McKinsey & Company provide a useful overview of the latest data to enable us to get a handle on the duration, geographical spread and scale of intervention required as a result of the economic crisis.
Can your business offer support to tackle COVID-19?
If so, you can use this service to tell the government how your business might be able to help, for example with:
- Medical testing equipment.
- Medical equipment design.
- Protective equipment for healthcare workers, such as masks, gowns and sanitiser.
- Hotel rooms.
- Transport and logistics, for moving goods or people.
- Manufacturing equipment.
- Warehouse or office space, for medical use or storage.
- Expertise or support on IT, manufacturing, construction, project management, procurement or engineering.
- Social care or childcare.