When the economy contracts, so, too, does corporate risk tolerance. The default response in many boardrooms is to tighten budgets, trim headcount and preserve liquidity. But history shows downturns are not just times of contraction, they are moments when strategic moves can define industry leaders for the next decade.
Within today’s climate of persistent uncertainty, from inflation and geopolitical instability to tighter capital markets and shifting customer demand, boards must help management rethink their posture on risk. Instead of simply mitigating risk, boards have a mandate to reframe it: spotting where emerging vulnerabilities can be converted into levers for profitable growth.
This requires a shift in mindset from protection to possibility and from survival to strategy.
The Boardroom’s Role in a Risk Reframe
Boards play a critical role in helping companies see the full picture. This is not just the financial threats of an economic downturn, but the strategic white space such an environment can reveal. Particularly in private companies, where boards are often more hands-on, directors can push for adaptive thinking and calculated offense as opposed to just defensive tactics.
Three core principles can guide boards looking to lead in this environment.
Risk is a signal, not just a threat. Where others see instability, strong boards see unmet demand, underutilized assets and opportunities to consolidate market position.
Capital is not the only lever. Especially in constrained environments, companies can grow through partnerships, alliances, joint ventures and channel expansion, all without requiring heavy capital expenditures (capex).
Innovation thrives in constraint. When resources are limited, boards can drive creative thinking and force clarity on which bets truly matter.
Here are two examples that display how these principles show up in practice.
Svea Solar and IKEA: Expanding Access Through Retail Partnership
During periods of economic uncertainty, customer acquisition becomes more expensive and more complex, especially in sectors like renewable energy. Rather than retrench, Swedish solar energy company Svea Solar leaned into a partnership model to grow efficiently. In collaboration with IKEA, Svea Solar launched an innovative line of plug-and-play balcony solar panels, targeting urban dwellers in apartments, an often-overlooked market segment in the solar space.
This partnership allowed Svea Solar to tap into IKEA’s powerful retail footprint and sustainability brand while enabling IKEA to offer energy solutions that aligned with its environmental goals and appealed to a younger, price-conscious demographic. By co-developing a compact, easy-to-install product sold directly in IKEA stores, the two companies created a new market category, without the need for expensive direct sales or installation teams.
For boards, this is a powerful example of how a private company reframed distribution and product development risks into opportunities for scalable growth, all while reinforcing brand values and meeting evolving consumer needs. Rather than build out an expensive sales force or retail footprint, Svea Solar accessed a ready-made ecosystem, while IKEA added value without material capital outlay and aligned with its goals of reaching net-zero emissions by fiscal year 2050. Both companies benefited: one from expanded distribution, the other from new revenue lines.
JetBlue and United: Competing Together for Shared Profit
In a more surprising move, in May 2025, JetBlue and United Airlines, two major competitors, announced a strategic partnership linking loyalty programs. Under the agreement, the airlines are sharing codes, coordinating schedules and integrating frequent flyer programs for select regional markets. The companies also agreed to consolidate technical resources, with United moving its website and mobile app’s ability to sell several products to new technology and services provided by JetBlue’s platform.
At first glance, this alliance might seem counterintuitive. But from a boardroom perspective, it is a smart response to overlapping risk factors, such as high operating costs, declining regional demand and competitive route saturation, while allowing each party to manage and price their products independently.
Instead of fighting over marginal revenue, the two airlines pooled capacity to improve customer experience, increase load factors, expand geographic reach and reduce operational costs. The result is increased revenue, lower customer churn and better asset utilization, especially in price-sensitive geographies.
For boards, this example underscores how alliances, even among competitors, can turn structural inefficiencies into shared upside.
From Risk Identification to Revenue Innovation
For directors looking to guide companies through the next economic cycle, here are several practical areas to assess where risk might be a hidden opportunity.
Customer concentration → Market diversification via alliances. Companies that rely too heavily on a few major customers are particularly vulnerable during a downturn. Boards should encourage diversification through strategic partnerships, such as co-selling arrangements or integrated product bundles that open new channels without massive go-to-market investments.
Capital constraints → Asset-light growth. Traditional expansion, such as new markets or new products, often requires heavy spending. But with capital being scarce, companies can grow via “asset-light” levers: licensing deals, reseller partnerships, marketplace listings and embedded offerings that allow for scale without ownership.
Boards can press management to perform a “capex-light growth audit,” asking the question “Where are we missing revenue because we are defaulting to build instead of partner?”
Underutilized data or IP → Monetization. Many private companies sit on valuable assets, such as proprietary data, niche IP or customer workflows that remain untapped. Boards can direct management to explore monetization through partnerships, application programming interfaces (APIs) or licensing agreements that add revenue without cannibalizing core business.
A case in point: In my previous role overseeing partnerships and business development at Clearbit, the company built a thriving data business by focusing on API integrations that seamlessly embedded Clearbit’s market intelligence into customers’ existing systems such as customer relationship management systems, marketing tools, and sales workflows. Rather than requiring new dashboards or a behavior change, Clearbit became part of the workflow. This API-first approach made it easier for partners and platforms to adopt Clearbit, powering rapid growth and ecosystem stickiness. The company’s strong embedded presence and partner-driven growth strategy contributed to its acquisition by HubSpot in 2023.
Operational inefficiencies → Strategic automation and AI. Periods of slowdown often reveal hidden inefficiencies, such as duplicated processes, legacy systems and labor-intensive functions. Boards should promote judicious use of AI, not just to reduce cost, but to enable new capabilities, such as predictive analytics, personalized customer service or faster time to quote. Before deploying AI capabilities across an organization, it is critical to ensure good data management, governance and security practices are in place.
Market fragmentation → Inorganic growth via strategic mergers and acquisitions. In down markets, valuations soften and competitors with weaker balance sheets become acquisition targets. For companies with the right capital structure or creative deal-structuring capabilities, this environment can be a strategic window to acquire complementary capabilities, talent or customers.
Boards should ensure mergers and acquisitions (M&A) is part of the strategic planning conversation, not just a reactive response. This includes encouraging management to identify gaps that could be filled through tuck-in acquisitions, acqui-hires or technology buyouts. Even asset purchases or distressed carve-outs can be powerful levers to accelerate product road maps, expand market share or gain critical intellectual property at a fraction of the cost it might have taken in a bull market.
For boards, the key is not just approving deals, but setting the conditions that define when, why and how acquisitions align with long-term value creation. In a constrained market, strategic M&A becomes not just opportunistic, but essential to leapfrogging stagnation.
What High-Performing Boards Are Doing Differently
Boards can catalyze change when they move from oversight to insight. The most effective board leaders today:
- Champion cross-sector alliances, including those with non-obvious players, to spark innovation.
- Insist on metrics for partnership performance, and not just those related to pipeline and top-line revenue, but also metrics measuring margin impact, customer retention, expansion, lead-to-deal time and partner marketing impact.
- Reward calculated experimentation, especially when driven by data and framed around real risk-return trade-offs.
Courage, Creativity and Capital Discipline
The role of the board is evolving. In a down economy, the best directors do not just preserve what is left but help create what is next. That means navigating not just compliance and continuity, but creativity.
Risk, when viewed strategically, becomes not just something to be reduced but something to be leveraged.
As directors, we must ask: What if the risks we fear most are also the opportunities that define the company’s legacy?