Five things a Non-Executive Director can do for your business

Non-Executive Directors (NEDs) can improve the efficiency of a board and help transform the performance of an organisation. Yet research by the Chartered Association of Certified Accountants in 2007 revealed that only 10% of SMEs utilised the services of an NED.

Many business owners are reluctant to employ NEDs as they fear loss of control and privacy, disruption and distrust of outsiders and the cost of their services do not outweigh the benefits. Even where a business stakeholder, such as a Venture Capitalist, insist on their appointment they are seen as not independent and viewed with suspicion. Yet recruiting the right person and making a commitment to listen and accommodate that person will bring many valuable benefits for a business.

1. New skills and experience

By selecting a candidate with complimentary talents to your own you can fill a gap in the skill set of your board. Your NED will also bring valuable experience to the table and will have probably seen many of your problems you are currently facing before. They will also have an important network of contacts within their specialism that your business can easily tap into.

2. Improved Corporate Governance

By employing an NED you are making a commitment to improve the way your business is run. Your NED will bring the discipline of having regular and structured board meetings that will provide an arena for better quality and more informed decision-making. Formal board meetings will create an agenda that helps you concentrate more on the strategic direction of your business and less on operational matters.

3. Difficult decisions

Businesses that employ an NED are far more likely to take the difficult decisions that will help them to move forward such as parting company with a long standing but ineffective manager. Their detachment from the day-to-day running of the business will enable them to see key issues more clearly.

4. Credibility

Having an NED can provide improved credibility to the stakeholders of the business such as banks, other shareholders and even employees. Making a commitment to good governance and improving boardroom experience can make it easier to raise capital, or recruit key staff.

5. Independence

The NED's independence ensures they act with the interest of the company and not any one Director or Shareholder. This can help the Non-Executive Director resolve conflict between other board members and ensure the board acts for the good of the company as a whole.

So where can I find a NED?

To learn about how we can help your company or organisation recruit the right Non-Executive director please complete the enquiry form on this website.