The dispute between Sir Stelios Haji-Ioannou and the rest of the easyJet board is embarrassing for the company, but understandable. It is precisely the difficult question of how robustly to respond to deteriorating economic conditions that should be provoking lively debate in boardrooms up and down the country.

How sharply should capital expenditure be pruned back? How tightly should cash be conserved? How much can be paid out in dividends? These questions are resonant for all company directors as they boggle at the speed at which the economic skies are darkening.

Any board in unanimous agreement on such things would have to be made up of unthinking poodles. There is so much uncertainty about the outlook because of the breakneck pace at which events are unfolding. Souring consumer confidence and credit conditions, plunging sterling, not to mention eye-popping lurches in monetary and fiscal policy, make planning impossible. Forming a firm view of a company’s prospects two or three years out is daunting.

At best, Britain is heading for a downturn of early1990s severity. The worst-case scenario, however, is altogether gloomier. It is quite right that companies should ask themselves, do we merely batten down the hatches for a storm, or should we be stockpiling baked beans for a nuclear winter?

EasyJet’s dilemma is all the more acute. Demand for air travel is especially vulnerable to hard times; costs are at the mercy of the rollercoaster oil price; and capex tends to be large and lumpy – airliners cost £20 million apiece. The airline, founded in 1995, has until now never experienced difficult conditions, let alone the headwinds of a serious recession.

The row has been simmering for a few weeks but Sir Stelios’s response yesterday looks extreme. To wield an 11 per cent stake borrowed from his sister to demand two new board places and to threaten to topple the chairman is not the obvious way to find common ground and restore harmony.

The other board members are not exactly reckless or gung ho. Sir Colin Chandler is a former chief executive of Rolls-Royce, while Sir David Michels, currently deputy chairman of Marks & Spencer and Dawn Airey of Channel 5 know all about curdling consumer and business confidence. They feel they are already operating easyJet cautiously and that Sir Stelios is being too timid.

Sir Stelios, however, has a lot more to lose if easyJet misjudges things. He has already forfeited £130 million since the start of the year from the falling share price. After 13 years it is not unreasonable for him to wish for a maiden dividend. It may be ugly. It certainly should not have spilt outside the boardroom. But every company should be grappling with the doomsday scenario that haunts Sir Stelios.

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