I was in a Board meeting the other day when one of the other Non-Executive Directors asked about "the B-word". The CEO looked bemused and, indeed, confused. What, she asked, might "the B-word" be? "Brexit" explained the NED. What would be the impact of Brexit on the business?
After going around the issues for a few minutes, the answer emerged: none. While the business faces plenty of challenges, exiting the EU isn't likely to throw up any significant new ones. This is a services company, not in manufacturing or retail. It doesn’t import, or export, anything. It has no overseas operations. There's no reason to believe that regulatory frameworks will undergo major change, certainly for the time being.
The NED was surprised. He explained that he sat on more than one board and everyone else was much more concerned, ranging from "keeping an eye on things" to "very worried". So, just in case, the CEO agreed to join the "keeping an eye on things" crowd – after all, one wouldn't want to be complacent. But the fact is, the fundamentals of the business mean it is unlikely to be impacted by Brexit directly. Of course, if Brexit leads to a recession or mass unemployment, the business will be affected, as it would in any other economic slowdown. But, in this case at least, Brexit doesn't look like a major worry.
None of us know how Brexit is going to turn out. Now that negotiations with the EU have started, every business should keep the situation under review. Indeed, they should go further and make a virtue of keeping a watchful eye on all potential material risks and upsides. For some, Brexit will rise near the top of the list of things to worry about. For others, it won't, at least in the short term. In all cases, scenario planning is a great way to identify potential problems (and opportunities), and to develop a plan to deal with them. Good business leaders think ahead; great ones are two steps ahead of everyone else.
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