Ted Sikora is a Project Manager, Surveys and Business Analytics at NACD. This post is based on his NACD publication.
If 2020 was the year of the COVID-19 pandemic and 2021 was the year of building toward recovery, 2022 offered little respite for directors overseeing companies amid a chaotic business environment. To gain insight into the key trends that will impact boards in 2023 and how directors plan to adapt, the National Association of Corporate Directors has once again conducted its annual Board Trends and Priorities Survey. This year’s survey report includes insights from more than 300 directors, which detail what directors expect in the coming year, as well as the key improvement areas that they deem important. [1]
TOP TRENDS
Directors were asked to select the top five trends that they believe will have the greatest effect on their company over the next year. It’s no surprise that inflation and the threat of an economic recession are top of mind. After several months of record-breaking inflation, the threat of a recession looms over the business landscape with 64 percent of respondents selecting it as ranking among their top concerns. As inflation persists despite a series of interest-rate hikes initiated by the Federal Reserve, pessimism has increased toward the prospects of the US economy. (See Figure 1.) In fact, only 29 percent of respondents believe that the United States’ economy is heading for a “soft landing,” that is, stemming inflation while avoiding a recession by mid-2023. Meanwhile, 65 percent anticipate a recession, and 6 percent anticipate a severe recession. (See Figure 2.)
