Search this website. You can use fund codes to locate specific funds

How can companies mitigate the worst impacts of the coronavirus?

The coronavirus pandemic is forcing governments around the globe to enact emergency legislation to contain the spread of COVID-19, with cities in lockdown, shops, theatres and restaurants closed, and office workers logging on at home. In a two-part series, EOS at Federated Hermes (EOS) examines the role that boards can play in crisis management and how companies can manage supply chain risk and support their employees as working arrangements change.

Part 1. The roles boards can play in crisis management

To mitigate the worst impacts of a major crisis, there are several areas for board members and company executives to consider. By managing key environmental, social and governance (ESG) issues adequately, companies will be well positioned to weather the storm and potentially create long-term value for their shareholders and other stakeholders.

We recommend that board members take a proactive role in crisis management by considering the following:

  • Manage according to the momentum of the crisis
  • Manage the complexity as the crisis unfolds
  • Document learnings to enhance innovation and crisis resilience

We also encourage boards to consider establishing a clear business purpose statement to guide ethical behaviour.

Part 2. Supply chain risk and employees  

In the second instalment of our two-part series on crisis management, we recommend that companies improve global supply chain risk management by conducting an impact assessment. 

In addition, it is vital that businesses look beyond physical assets to understand their sources of long-term value – intangible assets such as human capital are estimated to account for on average 52% of a company’s market value1.  As such, we believe that boards should review flexible work practices to support their workforce.

Engaging on COVID-19

As the pandemic escalates, our colleagues at EOS are discussing the impact of COVID-19 with companies. These conversations are highly connected to the engagement themes outlined in the EOS Engagement Plan.

We hope that by being open and transparent about addressing a public health crisis through the lens of ESG, we can support companies in being better prepared to create long-term value for all stakeholders.

  1. 1“How and why human capital disclosures are evolving,” published by EY in October 2019.

More Insights

Weekly Credit Insight
Could a taper tantrum emerge in 2021?
Your Questions Answered by Impact Opportunities
The top 10 questions that clients and prospective clients ask our investment teams.
Electric vehicles: reaching a tipping point
How are automakers positioning themselves for an all-electric future?
Cautiously optimistic on US high yield
After a volatile year, Mark Durbiano CFA®, Senior Vice President and Senior Portfolio Manager from the Federated Hermes Inc. office in Pittsburgh, remains hopeful for a better 2021.
Credit: Industry Insights
Plugging into the future: challenges and opportunities for electric vehicle (EV) adoption.
Recognition for our responsible property development
The GRESB Real Estate Assessment results were announced this week.