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Spotlight On - Non Executive Roles

Becoming a non-executive director

In recent years, the importance of the chair and non-executive director role in the context of government has increased significantly. This trend is set to continue, given the demand for stronger governance, more effective risk management and organisational strategies that need to reflect our growing and changing communities. We are now seeing a more diverse range of talent and skill attracted to these appointments, reflecting the breadth of experience and ability in today's candidate market.

Non-executive director appointments offer real opportunities for broadening cross-sector exposure with real benefits for both employee and employer. Many senior executives today see that, by starting to develop their non-executive portfolio early, they are better prepared for their future career and are more marketable because of the broader perspective they offer. That said, the responsibility associated with non-executive appointments should not be underestimated, by those considering taking on a role - or the organisation seeking to appoint them.

What is a non-executive director?

There is no legal distinction between executive and non-executive director; however, the role each plays is very different. The non-executive director stands back from the day-to-day running of the business, drawing alongside the executive team as required to facilitate strategic decision-making.

In a start up or newly established non-departmental public body, for example, a non-executive director may act as a mentor, whose regular presence in the organisation provides inspirational leadership and an experienced voice guiding the organisation through the integration into government and its political complexities, to ensure success. At the other end of the spectrum, a non-executive director of an established government department may just attend board or audit committee meetings a few times a year. The work can, and does, vary.

Your organisation should ensure it recruits non-executive directors to complement the balance of skills and experience of existing board members. A non-executive director does not necessarily need to know the sector or business in which an organisation is operating, as this knowledge and experience is often held by the executive team. But the value of a non-executive director at every level of the corporate ladder lies in their ability to identify and advise on new challenges, initiatives and opportunities, and to develop and refocus strategic plans.

What are your responsibilities?

Although they may not spend the same amount of time undertaking company business as an executive director, the same level of commitment should be expected of non-executive directors. The following description provides a good summary:

'As part of your role, non-executive directors should constructively challenge and help develop proposals on strategy. Non-executive directors should scrutinise the performance of management in meeting agreed goals and objectives and monitor the reporting of performance. They should satisfy themselves on the integrity of financial information and that controls and systems of risk management are robust and defensible. They are responsible for determining appropriate levels of remuneration of executive directors and have a prime role in appointing, and where necessary removing, executive directors, and in succession planning.'

What do non-executives need to focus on?

Delivery Address the key drivers of the organisation, focusing on operational model, priorities, cost, supply chain and customers
Finance Effective use of financial management information to drive decision making and ensure value for money
Performance Reliable forecasts and meeting key performance indicators
Change Effective project management for both internal and customer focused projects.
Politics Is the delegation of authority appropriate (especially during times of change)
What are the big issues and who makes the decisions
People What is the calibre of the top team, especially under pressure, succession planning
Propriety Doing things right 

If you would like to learn more about how GatenbySanderson can help you, contact us on Leeds 0113 205 6071, London 020 7426 3960 or Birmingham 0121 644 5700.