Director Survey: How the Pandemic Has Set New M&A Priorities

According to new research by Deloitte, over the past two years, corporate boards have seen a raft of challenges come their way. “As COVID-19 spread globally, directors suddenly had to be certain that their management teams were doing everything possible to protect the health and safety of employees, to strengthen supply chains, to reinforce the company’s finances, and more. On the M&A front, boards saw a brief drop-in activity followed by a strong rebound that presented both risks and opportunities.”

The third annual survey of directors of US companies, conducted jointly by the National Association of Corporate Directors (NACD) and Deloitte, shows how directors’ views and actions on M&A matters have shifted.

The survey found that, “even as the pandemic raged, directors also had to grapple with a societal reckoning around racial, economic, and environmental issues. Boards faced a new urgency to ensure that their company’s strategies and actions aligned with its greater purpose and its responsibilities toward a broad range of stakeholders.”

With so much going on – so many demands on their time and expertise – directors inevitably reordered their priorities.

In summary, the survey found that “boards are giving M&A activity greater attention earlier in the process, ensuring that a company’s deal strategy is right and that diligence is done properly. The flip side is that they are giving less granular attention to integration planning and to longer-term efforts to assess deal success. Directors also are putting new emphasis on environmental, social, and governance (ESG) considerations in M&A, responding to growing demands from diverse stakeholders and the increased attention management teams are giving these issues.”

For the survey details, see Director Survey: How The Pandemic Has Set New M&A Priorities | Deloitte US.