In these current times, more individuals are developing portfolio careers, which include roles as non-executive directors (NEDs). This is not a role that suits everyone, and it’s also a crowded market. In spite of the regulation and voluntary codes involved with holding a NED role, plus additional responsibilities for those within listed companies, NEDs also have a place in companies backed by private equity, those seeking growth and development, family owned businesses, charities, social organisations, trade associations and government bodies.
So how do you decide if a particular non-executive director role is right for you?
Cranfield School of Management has established ten pointers for members of NonExecutiveDirectors.com to consider and determine if a NED role is for you:
1. Why does the organisation require a non-executive director?
For an early-stage business, the role might involve providing advice to the executives and establishing strategy. For a more mature business, your work is likely to involve more monitoring and governance. Are they and you clear on exactly what the role will entail?
2. Why do you want this position and what can you bring to the table?
A NED role can cover a wide spectrum. You might be a strategist, or an ‘independent friend’, or a monitor, or any of these things at different times. As when you apply for any job, ensure you think about what makes you right for that role at that organisation.
3. Due diligence is crucial
The organisation will most certainly undertake due diligence on you before it makes an appointment, in turn you must also complete your own due diligence. Make sure you fully understand the business, the dynamics between its owners and executives, and the people that you will be working with. If the other individuals on the board don’t share the same level of integrity as you, the boardroom could be an uncomfortable place.
4. Your induction to the business
On joining the organisation, ensure you ask about your proposed induction programme. It should be comprehensive, giving you a clear understanding of the mission and values of the organisation, as well as its strategy and operations. This process should be ongoing, so to make sure you keep up to date with any fundamental shifts as the organisation develops.
5. A representative or a director?
Sometimes the NED position will come about because a particular stakeholder or shareholder has the right to appoint a director to the board. It is important to remember that, despite this, your position must be to act on behalf of the company as a whole; you are not acting as a representative of a particular interest and you must avoid acting on conflicts of interest.
Download all ten tips, which we hope you find useful when deciding if a particular non-executive director role is right for you: https://hubs.ly/H0dpBfw0
For a deeper understanding of a non executive director role and how we can assist, please contact:
Cranfield School of Management
T: +44 (0)1234 758140
For more information visit: www.cranfield.ac.uk/som/neds
Professor Ruth Bender, Programme Director of The Non-Executive Directors’ Seminar at Cranfield School of Management