Taking on a board role as a Non-Executive Director (NED) can give you the opportunity to develop a healthy work-life balance and earn an attractive pay-to-hours ratio.
Non-executives are considered much more important in today’s business environment than they were twenty years ago. As a consequence, there are ample opportunities for experienced executives, with many professionals sitting on more than one board simultaneously.
However, the question you should ask yourself is how many roles can you manage without affecting your performance? In the US, boards are limiting the number of corporate directorships a non-executive can take on as it is argued that a director serving on too many boards cannot adequately discharge their duties. In reaction to this, we have outlined some key things that you should consider before adding more roles to your portfolio.
What is Expected From You?
Whilst Non-Executive Directors are largely drafted on to boards to provide strategic advice, governance and expertise, companies tend to have a variety of needs and complexities that can demand a substantial portion of your time.
A NED may only be expected to attend board meetings one day a month or whenever a meeting is called, but you will also be expected to make good use of your own time.
In the initial stages, your fellow board members will expect you to understand the company and its objectives. You may need to spend a lot of time researching their history, their achievements and how they can succeed in the current paradigm.
Although non-execs are not directly involved in the day-to-day running of a business, company directors will keep you in the loop by continuously sharing relevant information about the project. If your contribution offers little value to a company, executive directors will reduce your responsibilities. You could even damage your reputation and negatively impact your chances of serving on other boards.
Your Role Outside of the Boardroom
As mentioned above, Non-Executive Directors are a valuable resource that will be utilised both in and out of board meetings. It is the time restraints from the latter that you need to consider carefully.
It is not unusual for companies to utilise NEDs in several roles. The Walker Report indicates that NEDs may be assigned up to five roles. If you have been invited on to a company board because you have specialist skills and knowledge then you will probably be expected to contribute to the long-term vision of the company and act as mentors to senior staff.
You may also be engaged in networking. Some NED roles involve looking for new opportunities, making contacts and building useful relationships.
Regardless of how many roles you take on, the most important aspect is that you deliver a good performance. If you do not have adequate time to be as effective as you can be, taking on too many roles can work against you.
By way of guidance, an article published in the Sunday Times reveals that Henley Business School suggests NEDs should not take on any more than four board-level positions.
However, you should only take that as a ballpark figure. Bear in mind that every project is unique and will have different time restraints. In addition, it will also depend on your personal financial goals.
Don’t forget to consider how much time you want to spend with your family, enjoying your hobbies and socialising with your friends.
One of the key reasons why executives embark on a portfolio career as a Non-Executive Director is to reap the rewards of a career on your own terms. As a NED you no longer have to abide by the standard 9-5 routine, so make sure you get to reap the rewards of your new career by not taking on more roles than you are able to handle.
Intrigued by the prospect of earning a healthy wage whilst enjoying a great work-life balance? We can give you the training, information and network needed to succeed as a non-executive, plus you can browse the latest NED roles from across the UK. Find out more here.