Across the Board
Trade-War Uncertainty Prompts Wave of Companies to Yank Forecasts
New poll shows more than 80% of senior executives are worried about tariffs and other policy shifts
“A new wave of major U.S. and European companies, including General Motors, JetBlue, Snap and Volvo, are warning that the trade war’s unknowable course and consequences make it futile to forecast future performance…. Pulling guidance can frustrate investors looking to evaluate companies, while making it harder for Wall Street to set its expectations. The reluctance to give financial forecasts also shows the degree to which executives lack visibility into the economy now….The renewed round of CEO warnings come after major companies, including American Airlines, PepsiCo and Procter & Gamble, said last week that big-ticket items could soon cost more, travel and entertainment were becoming an early casualty of the trade war and companies were trying to significantly cut costs. Two of Europe’s largest banks on Tuesday set aside more money for soured loans and forecast scenarios where higher tariffs could hurt the global economy.” WALL STREET JOURNAL
Increased Uncertainty is Testing Boards’ Risk Readiness
Any cracks or deficiencies in what boards have outlined to investors will be scrutinized this year as the reality of global trade wars, supply chain disruptions and recession fears have spooked investors
“In times of economic turbulence and great uncertainty, the corporate governance systems that boards have put in place are really put to the test. Heightened levels of uncertainty in 2025 are placing directors under increasingly greater pressure to prove that their plans for their company’s growth are credible, adaptable and sustainable…. Good governance requires that the board and management have a process that allows the organization to discuss and resolve these types of difficult issues. This year should test whether companies have a good process to identify risks or whether they need to improve it.” CORPORATE BOARD MEMBER
Emerging Risks and the Internal Audit Function The volatile and fluid nature of our current risk landscape requires vigilance from boards, management and internal audit
“When it comes to assessing and navigating the risk environment, an internal audit is the board's most trusted ally. An integral part of the company's risk management system, the role of the internal audit function is to keep a close pulse on emerging and ‘under the radar’ threats. For boards of public companies, leveraging an internal audit is critical both for operational risk management as well as for fulfilling oversight obligations… When speaking to an audience of senior internal auditors recently about the risk environment in North America, 70% said they expected the risks their organizations face to significantly increase in the next two years. Not one person predicted a decrease.” DIRECTORS & BOARDS
What are Boards Missing Beyond Risk Reports
Boards must also take ownership of their informational needs
“High-profile risk management failures have continued to attract regulatory and investor scrutiny, with boards of directors increasingly in the spotlight. While operational losses and reputational damage have historically been tied to management decisions, oversight bodies are now more frequently called to account for shortcomings in governance. Investments in risk management capabilities have grown significantly across sectors. Yet despite these efforts, recent incidents suggest that many organizations still face fundamental challenges in board-level risk oversight.” INSURANCE BUSINESS
Public Companies Preparing for Shareholder Activism There is no free pass from activism during periods of significant market disruption, even where the primary drivers are macroeconomic and outside the company’s control
“As public companies navigate a landscape marked by rapid and substantial market volatility, regulatory uncertainty and geopolitical shifts, there is growing concern inside boardrooms that these same factors may increase vulnerability to a more familiar threat: shareholder activism. Whether or not catalyzed by this uncertainty, activists remain persistent. Through the first few months of 2025, the drumbeat of activist campaign launches has surpassed the highs of recent years. While some investors are hitting “pause” on making large new investments, others (including activist funds) are seizing opportunities to invest in high-quality companies at attractive valuations.” KIRLAND & ELLIS
The Hidden Risks of Delegating Routine Tasks to AI The goal should not be to resist AI but to integrate it in a way that preserves leadership influence and strengthens the board chair’s strategic objectives
“Power-conduit tasks, such as setting meeting agendas and establishing board committees, may appear routine but are vital for enabling leaders to exert their influence.... Leaving the task of creating the agenda to AI—based on, for example, how long each item has taken to discuss in the past—completely bypasses the chair’s strategic thinking. The chair also exercises behind-the-scenes influence over the flow of information that AI cannot easily replicate. They guide how information is presented, manage who speaks and when, and ensure people interact constructively.” HARVARD BUSINESS REVIEW
Kohl’s Terminates CEO for Cause After Investigation
Investigation found Ashley Buchanan violated company policies related to conflicts of interests with certain vendors
“Kohl’s fired its chief executive Ashley Buchanan after it discovered he had instructed the retailer to enter into a 'highly unusual' business deal involving a woman with whom he has had a romantic relationship... Buchanan met Chandra Holt, when they were both working at Walmart several years ago. Buchanan went on to run crafts chain Michael’s and took over as Kohl’s CEO in November. Holt went on to become the CEO of Bed Bath & Beyond. She is now a consultant and the founder of Incredibrew, a coffee brand infused with vitamins and minerals.... The filing said he directed the retailer to conduct business with this vendor and he caused the company to enter into a multimillion-dollar consulting agreement, where that person was part of the consulting team. Kohl’s said Buchanan didn’t disclose this relationship as required by its code of ethics and determined the conduct in both cases constituted cause for termination.” WALL STREET JOURNAL
Corporation for Public Broadcasting Sues Trump After Attempt to Fire Directors
President Trump tried to fire three of the five board members
“President Trump opened up a new front in his assault on public media on Monday, asserting that he was removing three of the five board members of the Corporation for Public Broadcasting. The corporation sued Trump on Tuesday morning in response, pointing to federal law and a U.S. Supreme Court ruling to contend that he does not have the power to take these actions. At a court hearing Tuesday afternoon, U.S. District Court Judge Randolph D. Moss ordered both sides to file arguments on CPB's motion for a temporary restraining order that would prevent Trump's decree from taking effect until the case was fully heard…. Under the law that created CPB more than five decades ago, the president has the authority to appoint members of its board, in consultation with Senate leaders of both parties. The law does not, however, establish any authority for a president to remove them.” NPR
Tesla Chair Denies Plans to Look for New CEO to Replace Musk
WSJ reports EV maker's board contacted search firms for Musk replacement about a month ago
“Tesla chair Robyn Denholm on Thursday denied a Wall Street Journal report that said board members had reached out to executive search firms to find a new replacement for CEO Elon Musk…. Denholm said on X that the report was ‘absolutely false’ and said that the EV maker's board is ‘highly confident’ in Musk's ability to ‘continue executing on the exciting growth plan ahead’… Musk said last week he would cut back significantly on the time he devotes to the Trump administration and spend more time running Tesla.” REUTERS
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