Footnotes
1 KPMG BLC online survey of directors conducted March 31–April 23, 2026.
Strategy oversight amid volatility
Boards are deepening their engagement on strategy—moving from annual strategic reviews to more continual, dynamic engagement.
Webcast: Calibrating the Board’s Engagement in Strategy
Macroeconomic and geopolitical risks, the rise of artificial intelligence, and policy shifts on trade, immigration, tax, and more are reshaping the global business landscape. To help their companies navigate the volatility and uncertainty, boards are deepening their engagement on strategy—moving from annual strategic reviews to more continual, dynamic engagement.
“The level of change and disruption and volatility today is testing all organizations to adapt and to be resilient,” said John Rodi, co-leader of the KPMG Board Leadership Center (BLC). “Companies today are facing a combination of challenges that is perhaps once in a generation.”
Rodi was joined on a recent BLC webcast by Sara Mathew, lead director at State Street, and Susan Chapman-Hughes, director at JM Smucker and Toast, to discuss the changing nature of board engagement in strategy. The following are takeaways from that conversation.
While an annual strategy process made sense when the environment wasn’t changing much, it isn’t sufficient given the current pace of change. “We moved … to a more dynamic review a couple of years ago to address the pace of change,” said Mathew. “We also added some ad hoc meetings in between scheduled strategy meetings to deal with follow ups as needed.”
Moving to more dynamic engagement
“It used to be that you could set your strategic plan for the next three years and kind of just roll off the playbook, but that is no longer the case given all the things that are happening real-time that are influencing the business growth and decisions,” said Chapman-Hughes.
Among roughly 700 directors surveyed by the KPMG Board Leadership Center, the vast majority view it as “very likely” (31 percent) or “somewhat likely” (49 percent) that their company’s strategy will require significant adjustment over the next 1–2 years.1 Most directors responding to the same survey said their board’s involvement in the company’s strategy process has increased over the past 1–2 years.
In your view, what is the likelihood that your company’s strategy will require significant adjustment over the next 1-2 years? (n=691)
To what extent has the board’s involvement in the company’s strategy process increased over the past 1-2 years? (n=705)
Mathew emphasized the importance of integrating both agility and resilience. “If you over-rotate on resilience, over time it can become a substitute for strategy, which is dangerous,” she said. “I also think agility has organizational limits. Very large organizations and companies can’t just pivot on a dime.”
Mathew suggests separating the strategic frame from execution. “Set your overarching strategic objective. Use scenario planning to stress-test the frame,” she said. “At the execution level … give management latitude to adapt execution without revisiting the frame every time the environment shifts.”
Judgment is required to decide when a change in environment warrants revisiting the frame, rather than just adapting within it, said Mathew. “I think that judgment and the ability to bring the board along is increasingly becoming a core leadership competency for CEOs.”
As companies navigate volatility, boards should ask, “Do you have the right people sitting in the right seats who can help you to deal with this push and pull?” said Chapman-Hughes. “You want to build resiliency and processes and the ability to make sure that you can operate so that you don’t end up going too much on defense or too much on offense.”
“Oftentimes when there is chaos, [there are] opportunities for you to lean into, accelerate your business strategy, and the growth of your business,” added Chapman-Hughes. “If you aren’t prepared for those times, then you’re not going to be able to take advantage of those.”
Noses in, Fingers out
A challenge for every board is engaging in strategy without stepping over the line into management’s domain. “Management is responsible for strategy, but the board is also responsible for ensuring it is a good strategy, not just a strategy,” said Mathew. To find that balance, she said boards should ask, “What does the management need from this board, at this moment, given these conditions?”
Chapman-Hughes added, “It’s important to remember that, in certain circumstances, the management team may want to have more than just your nose in, but you have to follow their lead.” That’s where process comes in. “That’s why you have set up the cadence for how you actually engage and go through strategy,” she said. “If there is a deviation or a problem with the strategy and, for example, the company ends up dealing with an activist or others … the board needs to be aligned on how to navigate.”
As companies navigate the risks and opportunities associated with AI and AI strategy, which may change rapidly as the technology evolves, Chapman-Hughes cautioned boards not to let it distract too much from the company’s core strategy. “AI … is an element that you should be considering around strategy. The strategy should be how you’re going to grow the business,” she said. “You can't lose sight of why you are in business. This is where having an organization that is change-ready and that is resilient is really important.”
Understanding and monitoring geopolitical risk is also an imperative for boards as companies sharpen their focus on access to capital, supply chain risks, and resilience. “It's about having directors who can assess geopolitical risk with the same rigor we apply to financial or operational risk,” said Mathew.
That doesn’t necessarily mean bringing an expert onto the board. “You want directors who are curious, read widely, who engage with ideas outside their domain,” said Mathew. “I think in this environment, those directors maybe are more valuable than someone who has deeper and more static expertise in a single area.”
Leveraging the right external expertise is equally important. “Everything doesn't have to sit with the board, but you have to be smart enough to know when you need the help and to have the right partners at the table before you need it,” said Chapman-Hughes.
With activism expected to remain elevated in 2026, “every board should be pressure-testing themselves for activism,” said Chapman-Hughes.
“If you're not navigating through understanding how the landscape is changing, you're probably … leaving risk on the table for your organization,” she said. “Preparation … is really important and boards need to spend time on that.”
“The ability to have … constructive, confrontative conversations in the room and still be aligned when you come out—that’s a rhythm that’s not going to happen all of a sudden if you have an activist in your stock,” she added. “That rhythm happens because you have set that as the culture in the boardroom well before.”
The views and opinions expressed herein are those of the webcast participants and do not necessarily represent the views of KPMG LLP.