Board Questionnaire: The Board’s Role in Brexit Oversight

By NACD Staff


Risk Strategy

In brief: This questionnaire is designed to assist boards in their engagement with management about Brexit concerns related to strategy, operations, finance, regulatory and legal compliance, and communication with investors. 

This resource can help your board

  • Consider potential Brexit scenarios and how they will impact company strategy and operations.

  • Determine how potential changes to tax jurisdictions and regulatory regimes will affect compliance.

  • Develop contingency plans should immigration to the UK affect company talent.

Most relevant audiences: corporations with headquarters, operations, and/or customers and suppliers in the UK

Board Questionnaire: The Board’s Role in Brexit Oversight

In the June 23, 2016, referendum, British citizens voted for the United Kingdom’s (UK’s) withdrawal from the European Union (EU), setting a process in motion for the UK government to formally change its relationship with the EU. On March 29, 2017, the UK invoked Article 50 of the Lisbon Treaty to initiate its exit process from the EU, leaving two years to negotiate the details of the post-Brexit EU-UK relationship. Following months of negotiations between the UK and the EU, the draft withdrawal agreement was released in November 2018. However, the deal, put forward by British Prime Minister Theresa May, has yet to be ratified by the British Parliament as of January 18, 2019. Following ratification by the UK legislature, EU member countries would also need to approve the deal in order for it to be effective by the time Brexit is slated to occur March 29, 2019. If the existing deal is not ratified by the British Parliament, there are a number of possible Brexit scenarios to consider going forward.

Regardless of how Brexit unfolds, separating from the EU would lead to political and economic changes for the UK and other countries. Corporations with headquarters or operations in the UK may be affected by disruption in trade with the EU, a change in applicable tax jurisdictions and regulatory regimes, and changes to UK immigration laws. Economic volatility and changes in the valuation of the pound sterling may also have significant business implications. Boards should ensure that management understands and is ready to act upon possible Brexit scenarios that affect growth strategy, operations, finances, and regulatory and legal compliance—in addition to offering transparency to investors about the impact of Brexit.

The following questionnaire is designed to assist boards in their engagement with management about Brexit concerns. Questions are drawn from a number of sources, including NACD webinars and blogs, partner resources, and third-party materials. Based on your company’s unique risk profile, specific questions listed in the questionnaire may be more relevant than others and may require deeper analysis.

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