Truly one of the greatest things a Non-Executive Director can bring to a board is to assist in its development with an open mind and a willingness to grow it to its full potential.
There are approximately 6 million businesses in the UK, with 99% of them being SMEs of which 1.9 million are limited companies. These SMEs contribute around 51% of all private sector turnover and as such, it is more than likely that as a Non-Executive Director (NED) you will find you can make the most difference.
The desire to have a NED in a private company can come about for a number of reasons including:
- The board has lost its way
- It has got a little too comfortable
- The business is struggling for funds, personnel or focus
- The business is growing and the board is overwhelmed
- The owners want a planned exit and need a guiding hand
Whatever the reason, there is usually some sort of catalyst to a new appointment.
Such appointments can be somewhat daunting for the rest of the board, even where there is a serious appetite for change. Therefore, to create traction, a world-class NED will need to take initiative as quickly as possible once they have assessed the situation.
Ex-senior military personnel have without a doubt not only the confidence to face such issues head-on but also the resilience to deal with any fallouts that are a consequence of actions taken.
Many NEDs may second guess their guidance or suffer from ‘imposter syndrome’. The following are recommended processes to help NEDs to deliver excellence in the boardroom:
- Discover – To drive the board to the best it can be, a great NED needs to get behind any bravado and identify any real or perceived issues. The executive team could be suffering from personal or business issues and it is essential to create a support structure that improves their resilience and flexibility, in addition to providing tools to help deal with adversity.
- Enlighten – Being a director is certainly about reward, but it is full of risks, which few SME directors will be aware of. Whilst there are no “get out of jail cards”, a great NED will have an armoury of fire guards at their disposal. Such a NED will install the virtues of integrity and provide wisdom and insight into legal and compliance requirements.
- Educate – Bringing about process and structure in the boardroom will create improved governance and more importantly, better decision making by demonstrating best practices in challenging the status quo.
- Focus – Due to the size of companies many board members are likely to be not only directors but also managers and owners. An important part of the NED’s job is to create strategic focus whilst maintaining energy.