Reports have emerged yesterday that the Coronavirus outbreak combined with a global oil crisis is having an impact on global financial markets, with trading being briefly suspended in the US yesterday and the United Nations warning that some countries could fall into recession as a result.
Sky News reported that the FTSE 100 saw more than £130bn wiped from the value of its constituent companies within minutes on Monday morning as the latest sell-off began in Europe following sharp falls in Asia overnight, while the price of Brent crude fell to near $30 a barrel, the worst daily plunge in percentage terms since the build-up to the 1991 Gulf War – hitting levels not seen since early 2016.
With yesterday being deemed ‘Black Monday’ and a pledge from President Trump helping to boost the market again today, it remains to be seen how the fragile financial market will perform over the next few weeks, particularly with the UK budget due tomorrow. CEO coach and author of VIC ecoaching software, Peter Ryding, warns that in times like this, business leaders need to show true leadership to protect the business.
“Coronavirus will get worse before it gets better, which is why the markets are panicking – but it will eventually go and shares will ultimately bounce back.
“In the meantime some companies could run out of cash and die – our job as leaders is to ensure that OUR business survives.
“For shareholders, employees, customers and our suppliers, the CEO has to take decisive decisions and stand out in tough times, embodying the inspiring leader that your stakeholders want to see – increasing confidence in the business. Even in the worst financial climates, some businesses manage to thrive.
“To successfully navigate any business crisis, the CEO should focus on two things, cashflow and people – which means working with your Financial Director and your HR Director. They are experts in their respective areas – and a wise CEO knows when to delegate. Ensure that your HR Director has the powers they need to bring in whatever working changes they need to thrive, be that flexible working, work from home or absence management policies to protect your staff. Likewise, ensure that your Finance Director feels empowered to take financial decisions to ensure that the business remains healthy – in both cases, offer support, encouragement and motivation.
“Finance and employees are the lifeblood of any business – without either, failure is inevitable. Once you have ensured your cashflow and your people are both taken care of, you can decide how best to steer the business. Right now, however, as the markets are panicking, a focused CEO is the strongest asset a business can have in a crisis.”