• Move forward on your growth agenda, especially in emerging markets. Corporate profits have become increasingly reliant on overseas demand, with international profits now accounting for roughly one-third of corporate profits. Your global strategy should be grounded in distinctive capabilities that you develop deliberately: through organic internal efforts, acquisitions chosen for the capabilities that would be gained through them, or collaborative arrangements.
• Audit your defenses against takeovers. Today’s stock prices create a window of opportunity for buyers. It behooves executives to ensure they will have the requisite time to devise and execute a response to an acquisition bid. A high-level defense audit covers four basic topics: general state and corporate takeover laws, board of directors structure and policies, shareholder voting processes, and takeover provisions (including poison pills) within your own governance structures.
Justin Pettit is a partner with Booz & Company in New York specializing in shareholder value and corporate finance. He is the author of Strategic Corporate Finance: Applications in Valuation and Capital Structure (Wiley, 2007) and coauthor (with Gerald Adolph) of the forthcoming Merge Ahead: Mastering the Five Enduring Trends of Artful M&A (McGraw-Hill, 2009).