Navigating Cognitive Decline in Leadership: The Challenges of Alzheimer’s and Dementia in Corporate Boards and Executive Teams

Diversity Australia Blog

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As populations age globally, the prevalence of age-related cognitive impairments such as Alzheimer’s and dementia is rising, posing unique challenges across all sectors of society, including corporate governance. In the context of leadership roles within companies—particularly in boards of directors and executive teams—addressing the cognitive decline of senior members is both sensitive and necessary for maintaining the health and integrity of the organization. This article explores the critical aspects of recognizing and managing cognitive decline in high-level corporate roles.

Understanding Cognitive Decline
Alzheimer’s disease and other forms of dementia affect cognitive functions including memory, thinking, orientation, comprehension, calculation, learning capacity, language, and judgment. While the onset can be subtle and gradual, the progression can significantly impair an individual’s ability to fulfill professional responsibilities effectively, especially in high-stakes environments.

The Impact on Leadership
Leadership roles require not only technical skills and knowledge but also sharp cognitive abilities such as problem-solving, quick decision-making, and strategic planning. Cognitive impairments can hinder these abilities, potentially leading to poor judgment, reduced ability to communicate effectively, decreased problem-solving capacity, and ultimately, a risk to the company’s governance and performance.

Recognizing Signs of Cognitive Decline
The first step in addressing cognitive decline involves recognizing its signs, which can be particularly challenging as these can be subtle and manifest slowly over time. Signs to watch for include:

Memory Loss: Difficulty recalling recent events or conversations that affect job performance.
Communication Issues: Struggles with vocabulary, repeating phrases, or difficulty in grasping complex concepts quickly.
Changes in Behaviour: Shifts in personality or mood that are uncharacteristic of the individual’s usual demeanour.
Decision-Making Problems: Increased hesitation or poor decisions in areas where the executive previously excelled.

Legal and Ethical Considerations
The legal and ethical dimensions of addressing cognitive decline in leadership are complex. Discrimination laws protect employees—including executives—from being unfairly treated because of age or health conditions. However, companies also have a fiduciary duty to their stakeholders to ensure competent leadership.

Developing Policies
Corporations are increasingly urged to develop clear policies that outline steps to be taken when a leader shows signs of cognitive decline. These policies can include:

Regular Assessments: Implementing regular, objective cognitive assessments for senior executives, similar to routine physical exams, which can help in early detection and management.
Succession Planning: Ensuring there is a robust succession plan that includes a strategy for unexpected transitions in leadership.
Support and Accommodation: Where possible, modifying the affected individual’s role to leverage their strengths and minimize risks.

Ethical Decision-Making
Deciding when an executive is no longer fit to serve due to cognitive decline is fraught with ethical considerations. It involves balancing the dignity and rights of the individual with the overall welfare of the organization. Transparent and respectful communication is essential. Any decision should be based on comprehensive assessments and in consultation with medical professionals.

Case-by-Case Approach
Every situation will be unique. Factors such as the individual’s specific job responsibilities, the severity of the cognitive impairment, and the available support structures will all influence decisions. It is critical that these decisions are not made in isolation but involve a team of stakeholders including HR professionals, medical experts, and legal advisors.

As the average age of corporate leadership increases, so does the importance of addressing the challenges posed by cognitive decline. Companies must navigate these challenges with a balanced approach that respects and supports affected individuals while ensuring robust governance and leadership.

Developing clear policies, engaging in open dialogue, and maintaining a focus on ethical decision-making are all essential strategies for managing this sensitive issue effectively.

Ultimately, protecting both the individual’s dignity and the company’s integrity should guide all actions and decisions.

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About The Author

Steven Asnicar

Steven leads the Diversity Australia Consulting business in Australia and New Zealand and is an active Leader in the Asia Pacific region. With a senior executive career spanning 25 years in corporate as a Director and Chief Executive, consulting and executive search specialist, Steven founded and led a successful specialist leadership development and assessment firm in Asia Pacific for 18 years prior to founding Diversity Australia.

Steven is a highly experienced Executive and Coach, working with Boards, individuals and teams at the C-Suite level. He also advises clients on leadership development, succession planning and executive assessment. As an innate entrepreneur, Steven brings an innovative, data informed approach to co-create impactful yet pragmatic client solutions.

Steven earned a Masters of International Business specialising in Human Capital Management through Bond University, a Graduate Certificate of Corporate Management through Deakin and a Bachelor of Business through UQ. He is a is a graduate of the Global Institute of Directors, a qualified RABQSA Auditor, and is a thought leader on executive diversity, equity and inclusion, with over 26,000 followers on his LinkedIn profile: https://au.linkedin.com/in/steven-asnicar.

View our key team of consultants and trainers at: https://www.diversityaustralia.com.au/our-team.

About Diversity Australia: Leading the Way in Diversity, Equity, and Inclusion

WE CHAMPION INCLUSION FOR ALL ORGANISATIONS: Diversity Australia is the leading national and international diversity, equity and inclusion (DE&I) professional services firm.

We specialise in DE&I training and consulting, including unconscious bias, inclusive leadership, psychological safety, respect at work, and cultural awareness and change.

BUILDING HIGH-PERFORMING, INCLUSIVE CULTURES: Our passion lies in developing strategies that promote cultures of inclusion and diversity. We help organisations foster a high-performing, equitable workforce that sets a new global standard for DE&I.

EXPERIENCE & EXPERTISE YOU CAN TRUST:

Led by CEO Steven Asnicar, an experienced executive and thought leader in strategic human resources and DE&I;
Team of over 10 highly qualified consultants with advanced degrees and extensive industry experience;
Alignment with Global ISO Diversity and Inclusion Standards, Australian Inclusive Service Standards (ISS), and ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations for DE&I;
Training content researched and created by subject matter experts, benchmarked across our diverse senior team;
Positive focus on the ethical and equity-related benefits of an inclusive culture.

About Diversity Australia:
Leading the Way in Diversity, Equity, and Inclusion

WE CHAMPION INCLUSION FOR ALL ORGANISATIONS: Diversity Australia is the leading national and international diversity, equity and inclusion (DE&I) professional services firm.

We specialise in DE&I training and consulting, including unconscious bias, inclusive leadership, psychological safety, respect at work, and cultural awareness and change.

EXPERIENCE & EXPERTISE YOU CAN TRUST:

● Led by CEO Steven Asnicar, an experienced executive and thought leader in strategic human resources and DE&I;
● Team of over 10 highly qualified consultants with advanced degrees and extensive industry experience;
● Alignment with Global ISO Diversity and Inclusion Standards, Australian Inclusive Service Standards (ISS), and ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations for DE&I;
● Training content researched and created by subject matter experts, benchmarked across our diverse senior team;
● Positive focus on the ethical and equity-related benefits of an inclusive culture.