Crisis Averted: The Board's Role in Managing Reputational Risk
In an era of instantaneous news reporting and ever-present cameras, companies have little time to respond to a crisis which can arise quickly from a wide range of sources, such as an information security breach, a compliance issue, or even a customer service episode. Unless a company is well prepared, irreparable harm can occur to the company’s brand and enterprise value.
As today’s headlines attest, reputational risk has become a key risk factor for companies large and small, requiring oversight by boards of directors, as well as corporate counsel. Do you know what your role is and are you prepared to manage this risk proactively?
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Holly J. GregoryHolly J. Gregory, co-chair of Sidley’s global Corporate Governance and Executive Compensation practice, counsels publicly held, private and not-for-profit corporations on the full range of governance issues, including governance structure and culture, fiduciary duties, risk oversight, conflicts of interest, board and committee structure, board leadership, special committee investigations, CEO transitions, board audits and self-evaluation processes, shareholder activism and initiatives, proxy contests, relationships with shareholders and proxy advisory firms, compliance with legislative, regulatory and listing rule requirements and governance best practices. She is frequently called on to advise boards regarding sensitive and unusual matters. While most of the matters she works on are highly confidential, high-profile matters that are in the public record include advising on governance and accountability mechanisms of the Internet Corporation for Assigned Names and Numbers to replace U.S. government oversight, and advising the Board of The Pennsylvania State University on governance reforms. Holly played a key role in drafting the OECD Principles of Corporate Governance and has advised the Internal Market Directorate of the European Commission on corporate governance regulation, and the joint OECD/World Bank Global Corporate Governance Forum on governance policy for developing and emerging markets. She also drafted the National Association of Corporate Directors (NACD) Key Agreed Principles of Corporate Governance. In addition to her legal practice and policy efforts, Holly has lectured extensively on governance topics, including at events in Europe and Asia sponsored by the U.S. State Department, International Corporate Governance Network (ICGN), The Conference Board, the NACD, Association of Corporate Counsel, Society for Corporate Governance and Institutional Shareholder Services (ISS). The author of numerous articles on governance topics, she writes the governance column for Practical Law: The Journal. Holly recently completed her term as chair of the American Bar Association’s (ABA) Corporate Governance Committee. She is a former co-chair of the ABA’s Delaware Law and Business Forum, a former appointed member of the Corporate Laws Committee where she served as co-editor of the Corporate Director’s Guidebook (Sixth Edition). She chaired the ABA task force that delivered the Report on the Delineation of Governance Roles & Responsibilities to Congress and the SEC in 2009. Holly serves on the ABA Business Law Section Council and is a founding trustee, member of the Executive Committee and fellow of The American College of Governance Counsel. She has served as an adjunct professor at Columbia Business School and as a member of multiple NACD Blue Ribbon Commissions. Holly clerked for the Honorable Roger J. Miner, United States Court of Appeals for the Second Circuit. A summa cum laude graduate of New York Law School and Executive Editor of its Law Review, Holly served on the Board of Trustees of New York Law School from 2009 through 2011. Holly is widely recognized for her work, including as: among the 100 Most Influential Players in Corporate Governance (NACD/Directorship 100), Directorship Magazine, 2017 and all prior years (eleven years total); one of the best and brightest minds in the legal profession in Ethisphere’s 2017 and 2015 Attorneys Who Matter; the Best in Corporate Governance at Euromoney Legal Media Group’s Americas Women in Business Law Awards 2016 and at the inaugural 2012 Awards; the leading practitioner in corporate governance law in the Guide to the World’s Leading Women in Business Law (July 2010); a Leading Practitioner in Corporate Governance in the International Who’s Who of Corporate Governance Lawyers, 2017 and prior years; and a leading lawyer in Corporate Governance in The Legal 500 US 2017 and prior years.
Howard Brod BrownsteinHoward Brownstein regularly serves as an independent member of Boards of Directors, and has chaired board Audit, Nominating and Strategic Planning/Risk Assessment committees. He currently serves on the Board of P&F Industries (NasdaqGM: PFIN), a publicly-held manufacturer/importer of air-powered tools and various residential hardware, chairs its Nominating & Governance and Strategic Planning/Risk Assessment Committees, and serves on its Audit Committee, and also serves on the Board of Merakey (formerly NHS), a leading nonprofit provider of education and human services to individuals with special needs, with more than 10,000 employees providing care to 40,000 adults and children in eight states and an annual budget over $500M. He served until recently on the Board of A.M. Castle & Co. (OTMKTS: CASL), a publicly-held global metals distributor and supply chain solutions provider, and on its Audit and Human Resource Committees, and was Audit Committee Chair of PICO Holdings (Nasdaq: PICO), a publicly-held diversified holding company and the designated financial expert for Sarbanes-Oxley purposes. He also recently served on the Board of LMG2, successor to Chicago Loop, a $600M parking infrastructure entity in downtown Chicago, in which a lender group led by Societe Generale succeeded to ownership following a restructuring. Howard Brownstein previously served as sole Board member of Betsey Johnson LLC, a privately-held designer and retailer of women’s apparel with equity sponsor Castanea Partners, and on the Board of Directors of Special Metals Corporation, a $1 billion nickel alloy producer, where he also chaired the Audit Committee and which was sold at a substantial gain, and on the Board and Audit Committee of Magnatrax Corporation, a $500 million manufacturer of metal buildings, which was similarly sold for a large gain. He also served as Chair of the Board of Trustees of the National Philanthropic Trust, among the fastest-growing charities and largest grant-making institutions nationally (over $1 billion to date), and the largest independent provider of donor advised funds with over $700 million under management. Mr. Brownstein previously served on the Board of a regional bank, a retail department store, and nonprofit Boards including chair of a United Way agency. Mr. Brownstein is a nationally-known turnaround and crisis management professional, and is the President of The Brownstein Corporation which provides turnaround management and advisory services to companies and their stakeholders, as well as investment banking services, fiduciary services, and litigation consulting, investigations and valuation services. Previously, Mr. Brownstein was Managing Director of Enprotech Corp., a wholly-owned subsidiary of ITOCHU (formerly C. Itoh), a Japanese trading company and then one of the world’s largest companies. Enprotech acted as ITOCHU’s acquisition and holding company for engineering service and product businesses with over $1 billion in assets. Mr. Brownstein served in several senior ex-ecutive and board positions at Enprotech, including CEO and COO of The Stone Group, a leading multinational manufacturer of comfort and safety equipment for the passenger rail industry with operations in the United States, Spain and England. Prior to becoming a turnaround management consultant, Mr. Brownstein founded a metals trading firm. Mr. Brownstein is a Certified Turnaround Professional (CTP). He has served on numerous boards of professional organizations, including the Turnaround Management Association, the Commercial Finance Association, and the American Bankruptcy Institute, as well as board committees and program leadership, and received TMA’s Outstanding Individual Contribution award in 2007. He has published over eighty articles, books and chapters, and serves as a contributing editor to two publications. He is a regular guest lecturer at Harvard Business School, Wharton, NYU, Villanova, and Northeastern, as well as at professional and educational programs. Howard Brownstein is a graduate of Harvard University, where he obtained J.D. and M.B.A. degrees, and of the University of Pennsylvania, where he obtained B.S. and B.A. degrees from the Wharton School and the College of Arts and Sciences. Mr. Brownstein is admitted to the bars of Pennsylvania, Massachusetts and Florida, but does not actively practice law. He also served in the U.S. Air Force Reserve, attaining the rank of First Lieutenant in the Medical Service Corps.
Davia TeminAs President and CEO of Temin and Company – a boutique management consultancy that helps corporations and organizations create, enhance and save their reputations – Davia Temin works with some of the most talented and impactful leaders in the world, helping them to refine and strengthen their vision, voice and market position in times of crisis and opportunity. Temin and Company specializes in crisis and reputation management for global companies, professional services firms, foundations, colleges and universities, and governments. Davia serves as a spokesman during crises, strategist, and leadership and communications coach at the board, CEO and executive committee levels. Temin and Company works with clients to create brand-distinguishing thought leadership and best practices in governance and corporate leadership, as well as to promote women’s leadership, and provide socially responsible marketing, media and social media strategy and execution. Davia is a frequent speaker around the world on reputation and crisis management, leadership, corporate governance, women’s leadership, resilience and what boards and leaders need to know about media, social media and artificial intelligence. A nationally recognized writer, commentator and expert in her fields, she has appeared on CBS, CNN, NBC, Bloomberg, PBS, ABC, and in The Wall Street Journal, and numerous other publications and networks around the world. Prior to founding the firm 20 years ago with the backing of GE, Davia headed Corporate Marketing for GE Capital, Schroders, Scudder, Citi Investment Bank and Columbia Business School. An Honors graduate of Swarthmore College, she serves on their Board. For 9 years she served as First Vice Chair of the Board of Girl Scouts of the USA and Chair of their National Fund Development Committee – originating their $1 billion campaign for girls, the largest fundraising campaign for girls in the world. She is Chair the of Board of Video Volunteers, an investigative media nonprofit based in India, and sits on the Boards or Advisory Boards of ProPublica, The Knight-Bagehot Fellowship, Committee for Economic Development, WomenCorporateDirectors, Harvard Women’s Leadership Board and Predmore Holdings. She also serves as an advisor to Chinook.ai and Springboard.ai. In 2018, Davia was named an Enterprising Woman of the Year by Enterprising Women magazine. She was honored by the National Organization for Women, accepting their 2017 Woman of Power & Influence Award for forging new paths for the next generation of women leaders. She received the Lifetime Achievement Award by Trust Across America-Trust Around the World and was named a Top Thought Leader in Trust. Davia has also been honored as one of the 30 Outstanding Women in the world by the National Council for Research on Women; named by Girl Scouts as a Woman of Distinction; and awarded The Girl Scouts Pinnacle Award for Leadership in 2015 – their highest honor. Profiled in many business and leadership books – most recently Broad Influence: How Women Are Changing the Way America Works and Stiletto Network – she writes the Reputation Matters column for Forbes.com, is a contributor to Huffington Post and American Banker, and has written Rebuilding Trust in the Financial Markets for the book Trust, Inc.