How Boards Can Optimize Stakeholder Governance - Barry G. Moss
When exploring the themes presented in the Fortune article on stakeholder governance, as a board director and business strategist, I find it valuable to expand on their significance. It’s important for boards to thoughtfully consider the diverse interests of stakeholders, particularly employees and investors, within the framework of stakeholder governance.
In the ever-evolving landscape of corporate decision-making, the role of financial liquidity takes center stage. Effective liquidity management becomes crucial when facing a sudden increase in interest rates. This challenge encompasses several aspects: firstly, managing the increased cost of servicing debt; secondly, assessing the feasibility of refinancing debt; and thirdly, navigating the complexities of financing new initiatives amidst rising financial commitments.
Boards should proactively address these multifaceted issues to equip the business with the resilience needed to thrive, especially during times when interest rates may remain elevated for an extended period. And most importantly, these concerns hold equal weight for both employees and investors. During challenging periods, prudent liquidity management can prevent extensive layoffs and offer the company and it’s investors more favorable financial choices, such as selling shares or debt at optimal prices. Additionally, it can allow the company to delay the sale of valuable assets, which might otherwise be necessary during a crisis.
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