Board Oversight: Charting the Course in Choppy Waters — in conversation with Marvin Loh
The bar for board performance has never been higher. Board members are expected to understand more complex businesses, deliver unfailingly effective governance, and meet the ever-rising expectations of stakeholders and shareholders. What is the key for boards to thrive in a time of unparalleled demands for, and heightened scrutiny of, their effectiveness?
We asked Marvin Loh, a highly experienced global financial expert and skillful navigator of shifting markets, for his perspective on today’s board environment.
“Marvin, as a global financial strategist, you travel worldwide and understand how different markets function from a cultural and corporate perspective. How does that expertise translate to the world of board service? What do board members need for vibrant performance in these volatile times?”
Corporate management and boards have never been so tested as they are today. The COVID-19 pandemic and its aftermath have upended almost every trend in globalization we’ve seen over the past few decades, from micro trends in demand and production to macro trends in credit availability and workforce size.
Interest rates and inflation are at the highest levels we’ve seen in more than a decade, while markets are rocked by escalating world conflicts. We see challenges in accessing capital and resources — including our most basic resource, human capital, as companies compete for top talent in a fiercely competitive job market. Many companies are realizing that their well-packaged approach to business might not be as easy to implement in the years ahead.
In navigating these choppy waters, the financial markets — where I have been involved at the company, industry, and macro market levels — are one of the quickest, most honest, and in some ways, most brutal arbiters of board and management success. You know immediately whether or not your plan is being accepted from investors. They either vote by buying more of your company, getting you more capital in terms of fixed income or loans, or moving away from you when your stock prices go down.
“What is your process in advising companies through the turbulence?”
I approach every opportunity by first understanding the stresses on a business and how management is positioning itself to address these pressure points. I talk with many stakeholders at the corporate level about what the markets are saying and whether or not their business plan
makes sense to the market and is being embraced by investors. Competitive analysis is an important part of the evaluation, because if you’re doing the same thing as everyone else, you’ll wind up with mediocre results.
“How do you parlay your knowledge into board service?”
The world we’ll see in the next five to 10 years is hugely different from what we’ve experienced in the last 20. Companies and boards will answer not only to their shareholders but also to increasingly vocal stakeholders. They will need strong guidance to meet progressively complex and demanding oversight responsibilities on a global stage. Because I have been a consultant for companies and investors, I understand the challenges boards face from many angles — and look forward to serving on a board that seeks to expand its reach and become more relevant to its constituencies.
Thank you, Marvin, for sharing you insights with us.
A financial strategist with a wide-reaching global perspective, Marvin Loh has more than three decades of experience in the financial service industry. With distinct expertise in advising public company board and executive leaders in their business planning, he distills global trends into their strategic, financial, and operational implications. Currently, Marvin serves as a senior global macro strategist at State Street Global Markets. He is a regular commentator on Bloomberg Television and sought-after presenter at investment, corporate, and media events.
