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Boards and Recession Part Two: The View From APAC

In part two of our boards and recession series, our global experts take a look at how boards are responding in India, Japan, and Australia.

Events around the world are hinting at a global recession, but different countries are being affected in different ways. APAC is certainly not immune to the disrupting forces affecting the rest of the world, although there are signs it may weather the storm.

In part one of the series, our experts examined the potential effects on the US, UK and Brazil. Read it here.


Parts of the corporate world in India are predicting a slight drop in earnings due to global recession. However, India itself is not anticipating an economic downturn; GDP growth in the current fiscal year is predicted to be 7%. Those sectors that are preparing for lower revenues include technology, automotive and engineering, metals and minerals, and building materials.

For these sectors, corporate boards (especially for listed companies) are actively engaging with their CEO and executive teams.

In particular, they are evaluating strategy around demand generation, supply chain composition, and cost structures.

We’re also seeing a greater interrogation of leadership teams, boards are increasingly replacing roles to quickly address cost pressures, supply chain issues, logistics, interest on debts, and wage inflation. Opportunistic boards are also looking at M&A opportunities as some of the marginal or financially weaker players may need to consider bankruptcy, and corporate valuations are now looking more attractive in a ‘bearish’ stock market.

In summary, boards in India are being more proactive, focusing on strategy and execution during the current environment.


In Japan, most listed companies have put in place corporate governance systems. In 2022, the Tokyo Stock Exchange changed the classification of listed companies to improve governance and revitalize the market. Tellingly, more than expected chose to remain in the Prime market, which has the most demanding standards for corporate governance. This may act as a bulwark against the coming recession.

Other issues are at play within the corporate boards of Japan, there is growing negativity towards board directors who play a role in too many companies, are ‘legally’ independent but have obvious corporate interests, and the lack of diversity resulting from this. Institutional investors, including the largest asset management companies in Japan, have collectively issued statements saying that they will not invest in companies that are not working to diversify their boards of directors. There has also been a noticeable move on the part of institutional investors to push this trend further.

Traditionally, companies have relied on the personal networks of the CEO to source board directors.

However, due to the increasingly stringent investor demands, we’re seeing more companies turn to executive search partners to recruit board members.

While the demands for outside board directors is growing, the supply of high-quality candidates is in short supply. Subsequently, this may have a detrimental effect on the ability of companies in Japan to respond effectively to a recession.


Sentiment in Australia is still relatively optimistic, market resilience is expected to continue despite being buffeted by macroeconomic headwinds, and global demand for Australia’s natural resources means that the economy is unlikely to take much of a beating.

Boards in the country are therefore focusing more of their time on ESG and human capital challenges.

Key considerations include attracting and retaining talent, diversity and inclusion and leadership of a more distributed workforce (WFH, WFA), as well as climate reporting and acting on COP26 commitments.

Notably, there is a trend towards leadership talent who are more strategic, are more long-term focused, and act as partners to the business. It’s fair to say that, while it isn’t the main focus, boards are increasingly trying to identify future risk, and want the best talent to help them achieve that.

To discuss how the recession may impact your business, and how your board can prepare, please contact the authors, get in touch with us here, or your local Odgers Berndtson contact.

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