The Pro and Cons of Being A Non-Executive Director
In this blog, Jo Haigh utilises personal experiences to share the possible pros and cons of being a non-executive director.
Any job comes with positives and the negatives. It’s impossible to find something so marvellous that it’s nothing but a wonderful experience. In fact, frankly, I think that might just be a tad boring. With regards to a Non-Exec Director (NED) role let’s start by reviewing the possible cons:
- As with any role, there is no certainty of tenure but for NEDs it’s likely a fixed term position and in some companies, this will be subject to annual approval of the shareholders.
- Whilst remuneration on the face of it may seem very fair and more compared to a salaried position for the contracted time commitment. The role will always require considerably more time than you anticipated.
- If you work in the private sector and particularly for an entrepreneurial owner-manager you will be “on-call” 24/7.
- As a board director whilst you are not an executive and as such don’t have a day to day role, you will have exactly the same liabilities as your executive colleagues. These are very extensive indeed and should not be taken likely.
- It can be exhausting and when a company hits a challenging time, relentless.
- Your liabilities rest with you for some issues and for anything that happened on your watch forever.
On the plus side, the pros that I have personally experienced as a Non-Exec Director include:
- The sheer fun, excitement and frankly huge satisfaction with assisting in delivering effective solutions.
- The flexibility of the role is great in that, if you want to work in multiple and ideally non-competing companies, you can.
- The hours you work are, to at least some extent, in your own control.
- The opportunity to learn is huge and the ability to pass that knowledge on to others very rewarding and satisfying.
- No day is ever the same – the sheer variety of the role is immense.
- You have the opportunity to meet amazing and talented people and learn from them. Plus, I have also learned masses from those not quite so talented to be honest!
- If you have joined the right firm you may also have the opportunity to engage in more formalized director development.
- Hopefully you will make friends and contacts for life, I know I have.
So, on the positive/negative scale being a NED definitely bends the scales towards the good. However, as with any position much of this is how you approach the role. Just as a perceived strength can become a weakness, so a pro can become a con. Complacencies are for the foolhardy. Each role and each day can bring about challenges and opportunities, it’s up to you how you chose to respond.
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