Questions Directors cannot afford to ignore in 2024

The success and sustainability of a company can be in part attributed to the ability of its Board to stay on top of the latest developments, act quickly and make informed decisions.  So, what are some of the key questions that directors should be asking themselves to ensure they achieve this as we near the new financial year?

1. Leveraging emerging technology: How effectively am I leveraging emerging technologies to enhance the company’s competitive advantage while proactively managing cybersecurity challenges? Directors should remain up to date with technological advancements, particularly in relation to artificial intelligence (AI) to help the company stay current and ahead of the competition. This includes taking proactive steps to explore how AI and other developing technologies can be integrated into business operations to enhance efficiency and foster innovation. The need to prioritise cybersecurity and mitigate risks of a data breach is an essential balancing factor. Wynn Williams will provide insights and updates regarding cybersecurity and privacy of data in the lead up to Privacy Week in May 2024.

2. Enhancing diversity, equity and inclusion (DE&I): Is the company’s culture inclusive and does it reflect diverse perspectives and experiences? Directors should focus on creating an inclusive workplace culture, diversifying their workplaces and providing equitable opportunities for their staff. Diverse perspectives enhance decision-making and innovation within companies and add immense value. Consider whether the company could benefit from adopting a DE&I policy.

3. Embracing environmental, social and corporate governance (ESG): How am I integrating ESG considerations into the Board’s decision-making processes? The emphasis on ESG factors and requirements for climate leadership has intensified with ESG and climate considerations continuing to shape investor decisions and consumer preferences. It is imperative for Boards to prioritise sustainability and ethical business practices. This includes incorporating ESG and carbon considerations into decision-making processes, actively assessing the company’s carbon footprint and enhancing ESG performance. Currently climate-related financial disclosures are only mandatory for around 200 entities in Aotearoa New Zealand – if these obligations were extended would the company be prepared?

4. Eradicating modern slavery: What steps can the company take to play its part in eradicating modern slavery? Tied in with ESG, but worth its own mention, is the important role that businesses play in eradicating modern slavery and worker exploitation. We are yet to see whether the National Government will proceed with modern slavery legislation proposed by the Labour Government. Keep an eye out for updates from Wynn Williams in this space but in the meantime, Boards should consider what actions can be taken now (i.e., including modern slavery provisions in company contracts to uphold suppliers and others to minimum standards).

5. Prioritising cultural considerations and Te Tiriti o Waitangi: Is the company contributing to a socially responsible and sustainable business environment in Aotearoa, New Zealand? Acknowledging the Te Tiriti o Waitangi principles of partnership, participation and protection is one step every director should take in fostering relationships with all stakeholders but particularly, with Māori. Investing in cultural competency training can help directors empower their workforce and position their company to thrive in Aotearoa New Zealand’s culturally diverse business environment.

6. Hoping for the best, preparing for the worst: Do we have measures and policies in place to help the company (literally and metaphorically) weather any storm? The last few years have illustrated the need for risk management and crises preparedness. The best way to stay prepared is to seek advice early (be that legal advice for corporate structuring, governance, business advisory and security (among others), accounting or financial advice), which brings with it the added benefit of reducing overall time, energy and spend in the long run.

Navigating the complexities of the corporate landscape and a director position has never been, and will never be, simple.  There are many balls for directors to juggle while always having the overarching need to increase value whilst proactively engaging with and considering the interests of stakeholders.

If you need assistance with any of the above (and more) or if they have sparked some questions you would like to discuss, reach out to the Business Advisory team at Wynn Williams.