Beyond the Forecast: The Board Decisions That Matter in a Slower, Tougher Economy

Insights from our latest webinar featuring economist Shamubeel Eaqub

Costs remain under pressure. Customers are cautious. Capital is harder to justify.

Many boards are trying to make decisions in an economy that feels slower, tougher and less predictable than it has in years.

The instinct is to ask, “What’s the forecast?”

It is the wrong question.

The uncomfortable question boards should be asking instead

What decisions do we need to make, despite not knowing what happens next?

That was the challenge economist Shamubeel Eaqub put to directors and CEOs in our latest webinar. His message was blunt: nobody can see the future. Forecasts are regularly wrong — not just in scale, but in direction. Relying on them to govern well is a mistake many boards are still making.

Stop watching forecasts. Start watching leading indicators.

Forecasts are an input, not a decision-making tool.

What boards should be watching instead are leading indicators specific to their own industry, not just the macroeconomic headlines.

Eaqub’s example: when second-hand excavators are being exported out of New Zealand, the infrastructure sector is in trouble. When those exports fall, confidence is returning — often twelve to twenty-four months ahead of the wider recovery.

Every sector has its own version of this signal:

• Customer payment behaviour
• Supplier payment terms
• Labour market movement
• Sector-specific demand signals

Lagging indicators tell you where you have been. Leading indicators tell you what to do next. Good boards track both. Most only track one.

The assumptions many boards no longer question, but should

Eaqub named three assumptions boards are still carrying that may no longer hold true:

• Pricing power will keep recovering
• Skilled people will be available when needed
• Money will stay cheap

None of these can be relied on. The last thirty years trained boards to expect them. The next thirty may not deliver them.

Boards that have not tested these assumptions at the table are not managing risk. They are hoping.

Why “the economy is recovering” is a dangerous comfort

Averages hide almost everything that matters.

The aggregate economic story might say things are improving. But industry, location and individual business performance can be wildly different underneath that headline.

If the economy recovers and your business “recovers with it,” that is the market moving. It is not you.

A high-performing board does not wait to be lifted by the tide. It asks what it is doing to participate in the recovery — and whether it is doing better than average. If a business isn’t beating the average, why bother?

What high-performing boards do differently

The gap between an average board and a high-performing one is not intelligence. It is discipline in three areas.

Stop, keep, start — not just cut. Average boards spend their time deciding what to cut and how to manage the downside. High-performing boards have honest conversations about what to protect, what to keep, and where to concentrate effort, and why.

A clear purpose with multiple pathways. Strong boards have a defined north star and a genuine plan A, B and C. When conditions shift, they are not caught out. They already know which lever they pull next.

Risk redefined as readiness. Risk appetite is not a word on a heat map. It is not “high” or “low” stated without context. The real question is: what do we need to know, and what will we do, when conditions change? Pre-agreed triggers linked to leading indicators turn a static annual forecast into a live decision-making tool.

Targets should never be traps.

AI is a culture problem before it is a technology problem

Boards are optimistic that AI will fix productivity. Eaqub is more cautious.

Technology only creates value when it comes with investment in people, systems and process. The businesses getting the most from AI are training leadership first, building in-house champions, and protecting culture as they go — not handing the initiative to IT and hoping it embeds itself.

For smaller organisations without a formal board, Eaqub suggested something practical: build a virtual advisory panel using AI personas of an accountant, a lawyer, a customer and an employee — and critically, an adversarial reviewer whose job is to challenge every other view. It will not replace real judgement, but it can surface the honest, multi-perspective conversation many boards structurally lack.

The one board habit worth changing immediately

Eaqub’s closing challenge was simple. At your next board meeting, ask: which assumption did we make two years ago that has since embarrassed us?

Not to assign blame. To build the humility and honesty that lets a board actually learn.

Final thought

The boards that will navigate this economy best are not necessarily the ones with the most accurate forecast.

They are the ones with the clearest assumptions, the most honest conversations, and a plan for what they will do when they turn out to be wrong.

Want to explore this further?

Watch the full webinar discussion here.

Continue the conversation

Join us for our next webinar featuring governance researcher and educator Matt Fullbrook, where we discuss why board agendas default to reporting, whether board packs are too long or just poorly focused, and what a better balance between reporting, discussion and decision-making looks like.

Less Reporting, Better Decisions: Rethinking the Board Agenda

Register here

If you’re starting to think about how this applies in your organisation, we’re always open to a conversation.

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