Top Tips for Non-Execs

1. Before you Join

• Think about why you wanted to join this board and how your background and skills will be of benefit to the organisation.

 

• You are already aware of the duties of a director as highlighted by the Companies Act 2016. As a refresher you have a fiduciary duty to the company and a duty of care (remember this means to carry out your role with care, skill and diligence) and you should ensure that you avoid any conflict of interest.

 

• Be clear you can commit the time required to undertake the role.

 

• Visit the organisation’s website to familiarise yourself with the general details including who the executive directors and other board members are.

 

• Read industry briefings and any sector press.

 

Your Action

Firstly, prepare any questions that require clarification after you have completed your initial research. Include any areas of concern or those where you need further information.

Next, carry out a self-assessment of your skills using the 6Cs as a guide so that you are aware from the outset what your development needs are. The 6Cs are competence, commitment, contribution, comprehension, capability and code. You can read more about the 6Cs in my November 2014 blog – ‘The 6Cs of an Effective Board Member available here: https://karlgeorge.com/the-6cs/ .

 

2. Induction

Ensure you receive a proper induction which should include information and/or presentations about the organisation and meetings with executive members of each of the key functions where necessary.

Your Action

 Make a note of the key corporate objectives, the key risks of the sector and the key risks of the organisation. Pay attention to all the key indicators including turnover, profit and balance sheet value. Also take note of the culture, vision and values so that you are well prepared for your role.

 

As part of your induction, you should receive the legal and statutory information including the annual report, the accounts, the constitution and the board and committee structures.

Your Action

You should seek assurance that accounts are up to date and there are no specific nuances in the articles. Review the terms of reference for the board and committees checking boundaries and delegations.

 

Ensure that you peruse key documents such as the risk register and the corporate plan and financial plan.

Your Action

Now that you understand the broad objectives and areas of risk you can now take a more detailed look and get a view on interrelationships between the documents. Look for evidence of how one document such as the terms of reference for the board informs the schedule of matters reserved for board consideration.

 

It may be possible before accepting the role to attend a board meeting as an observer. This will help in ensuring you are clear about the operating of the board. (Use the experience to observe how the executive and non-executive work together, note how the meeting is chaired and the contributions of the board members. Consider how timely and useful the reports are).

Request a copy of the calendar of board meetings and other events such away days and staff events and add the dates to your diary. If you have any queries about the documentation, governance or any other information, now is the time to seek clarification.

Your Action

Consider – is the documentation presented in a timely manner with the appropriate level of detail and is it clear what is required?

 

Review your role description and terms of appointment.

Your Action

Sign relevant paperwork and complete all of the required forms and declarations ensuring you retain copies for your records.

 

3. Preparation for Meetings

When preparing for meetings, always ensure that you:

a.       Review the agenda and papers before the meeting;

b.      Prepare a crib sheet of key numbers and indicators to refer to until these key numbers become second nature;

c.       Makes notes as you read the reports remembering to check any assumptions made, clarify any areas of uncertainty or ambiguity, looking out for unexplained variances or deviations from forecasts or plans;

d.      Make a note of areas that you are not sure about or need further explanation about that. (Remember you can request time for explanation outside of the meeting).

 

4. During the Meeting

Ensure your contributions throughout the meeting remain strategic whilst scrutinising and paying attention to risk and financial control. As you engage in the meeting ensure that your questions and contributions are clear and concise.

You can ask factual questions to clarify your interpretation or understanding. You can also pick up on points made by your colleagues and dig deeper to get to a suitable answer.

There are no stupid questions so if you are not sure of something ask, unless the question highlights the fact that you haven’t read your papers or completed the required reading on the basics i.e. the industry and/or history of the organisation. You can check on the expected outcomes from decisions made or the impact or progress on previous plans.

When reviewing the remuneration policy and that of the executive directors ask probing questions, request information about benchmarking and enquire how the outcomes have been linked to performance.

Conduct at the meetings is important and as a board member you should always display the Nolan Principles which are openness, objectivity, honesty, leadership, integrity, selflessness and accountability.

 

5. Contributions

Some board meetings are quite formal so be careful to observe board protocols like speaking through the chair.

Don’t speak for the sake of speaking but do try to make contributions on all areas of business not just the area that you have expertise in. Contributions include asking questions and seeking clarification. Try to make your contributions in a way that stretches and challenges the executive as well as scrutinising performance.

Always think about how you are adding value as a board member. Your monitoring and compliance role is important but also try to think outside of the box.

Make yourself available for evaluations/appraisals and make a note of where you feel your performance can be improved. Also take notes and feedback as appropriate where board meetings, board papers or committee meetings could be improved.

Remember that you are an ambassador for the organisation so be aware of how you represent the organisation and be willing to open up your networks and make time to carry out visits with the various stakeholders always talking positively in your circle of influence about the organisation.

Being a new NED can be daunting. As a more seasoned NED, it can be easy to fade into the background. Applying these principles will ensure you settle in if new and remain current if you have been on the board for a while. The key thing to remember is that as a member of the board, you are responsible, accountable and a champion!

 

Until next time…