Having been through the SARS outbreak, COVID-19 has had an air of familiarity to many in Singapore's business community. At a personal level, I was based in Hong Kong which was the epicentre of the SARS outbreak at the time, and remember clearly the halt that it brought to business operations. Within a very short period of time, virtually all of my clients in the region - that I would typically meet with in person -politely said, “don’t come!”
As for recovering from the impact, based on our experience with SARS , the sobering reality is that the economic fallout is likely to last for far longer than the health toll. We also learned that health vs economy is a false dichotomy... Without getting the virus under control, there can be no economic recovery.
The order of magnitude [of COV ID-19] has made all the difference. SARS resulted in around 8,000 cases across 26 countries, whereas with COVID-19, there are more than three million cases across 210 countries and territories to date, and numbers are continuing to climb. Clearly the travel restrictions and lockdowns around the world are unprecedented.
Top of mind issues for directors will vary according to the circumstances faced by each company. For those classified as essential businesses (including healthcare, public transportation, utilities etc), a key concern is ensuring the health and safety of their staff in the midst of ongoing operations. For others, it will be about business continuity and sustainability.
Another issue that is top of mind for directors is the conduct of AGM s. The regulator SGX has put in place provisions for AGMs to be deferred. However, with the current restrictions around gatherings, companies will need to explore virtual alternatives, which is uncharted territory for most. An AGM involves a bit more complexity than the standard Zoom call with issues such as identity verification that need to be addressed, for example.
Areas that some of the boards I’m serving on are focused on include rethinking our offerings, delivery models, work processes and people practices.
As the saying goes, never let a good crisis go to waste. Certainly, we need to get through the short term and it’s imperative to be focusing on cash flow, funding lines, and organisation stability. However, if we think of this as a temporary blip, and look forward to when things get back to “normal”, we will likely have missed a significant opportunity to reflect on what this means for our organisations in the longer term. Areas that some of the boards I’m serving on are focused on include rethinking our offerings, delivery models, work processes, and people practices.
Singapore has a very open and, hence, connected economy. Consequently, while measures are being taken by the government to help businesses and individuals alike, such as temporary relief from legal action (eg in the event a business or individual is unable to fulfil contracts), wage support, and so on, we are inevitably subject to global economic conditions.
Many companies are placing a great deal of focus on diversifying their supply chains as a way to hedge their risks. I expect this to continue for the foreseeable future, with increasing emphasis placed on factors beyond cost, and a shift away from hyper optimisation.
The health situation needs to be stabilised in order for the economy to recover and even in countries that have done a good job so far, there is a need to guard against complacency. Until every person and country is safe, no one is safe. The hyper-connected world that we live in suggests it would be prudent to prepare for a long tail.
About Su-Yen Wong
Su-Yen Wong is a professional speaker and Singapore-based independent director who serves on the boards of several public, private, membership and not-for-profit organisations in Australia, India, Indonesia, Myanmar, Singapore, and the United States. She is a Fellow and vice chair of the Singapore Institute of Directors and an active member of Women Corporate Directors and the Young Presidents’ Organization.
The Singapore Institute of Directors and Institute of Directors in New Zealand are members of the Global Network of Director Institutes, which seeks to share perspectives on global governance issues.
This article is featured in Boardroom April May 2020 issue