Archives for posts with tag: NED’s

Most of my current workload is taken up with finding independent non-executive directors, it’s a mix of small growing business and large established UK boards.  It’s a fascinating recruitment market for many reasons, not least it allows me to deal with the most senior people in the market and to have some fascinating conversations.  My blog would be infinitely more interesting if I could reproduce some of those but alas confidentiality is imperative to what I do!  In the last week though I’ve chatted with people who worked with Baroness Thatcher while she was at the height of her pomp, people who’ve raised billions of pounds to buy and sell businesses and heard one particularly juicy anecdote re a FTSE 100 CEO.  This makes life anything but dull.  

However I do want to focus on why hiring a good independent NED or two is a must for a small growing business.  There are many little businesses out there which don’t really employ NEDs, why would they?  You’re paying someone a relatively fat salary for a few days a year work, how is that cost effective when you’re struggling to get growth?  This is a conversation I had recently with a CEO, the thing is though it wildly misses the point.  The current competition for NED roles is absolutely fierce and the quality of candidates is honestly mind blowing.  If you have an interesting business with sound growth prospects you could very easily have a ftse100 main board director for very little money each year.  Yes that’s not full time but imagine what you could learn from that person.   Imagine the contacts they have.  Now imagine how much that will help grow your business.  It may be a hefty day rate that you have to fork out but it is more than worth it in the long run.  

An NED might not seem like something that’s important right now but I’d argue it’s time for a rethink, the value there is potentially incredible.

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You’d think I’d have far better things to do on New Years eve than write this but it’s rainy outside, all jobs are done and I’m waiting for the sound of bells so it’s as good a time as any to do it I guess.  Plus the chances of me finding any time at work when I get back are probably nil.  

Anyway today I want to actually write about work, well partly.  I also want to tackle the issues of sexism, women on UK boards and ‘diversity’.  Recently I’ve been working on several briefs for Non-Executive Directors at a range of companies from large to smaller sized, part of these briefs has been diversity policy.  Excellent, you might think, more women on UK boards, a jolly good idea!  Well, I absolutely agree, we need more women, minorities and diversity on our boards and I would love to be one of the people supplying it… there’s just one slight niggle.  Candidates.  

I work in a rather niche field so this problem may well be one of my own specialty and in the wider environment this may be totally wrong, however in the field I work there is a distinct lack of female/minority candidates.  There’s a simple reason for this, most NED’s are semi retired people in their late 50’s or 60’s, these people started work in the late 60’s or early 70’s when Britain was a very different place to what it is now.  The candidates I find are representative of this, 80%ish are white chaps of a certain age, the rest are a mixture of ethnicities and ladies.  Well you might say, that leaves 20% to go at, plenty of people?  Well no, most companies want the top 10% if not the top 5% of people on their board, those with the broadest experiences and the most to add.  That leaves plenty of the white chaps but significantly fewer of the female/minority candidates.  This means that those candidates out there who are in that group are incredibly in demand right now and frankly there’s not enough to go around for every company to increase diversity on their board.  

Now the thing is in the next layer down, the people who started their careers in the 80’s there is a comparable reflection of a changing society, far more women and minorities and far more candidates.  The thing is though these people aren’t at the stage in their career yet where they are looking for NED positions and don’t have the experience to do them.  In ten years time we will have greatly more diverse boards on our big companies as there’s a much more diverse workforce, in the meantime though, well that’s another story.  

I’d like to make it clear at this point, I’m not defending the status quo, boards must adapt, however this is not a short term issue we can simply fix with a positive selection method. There just aren’t enough quality candidates right now and the one thing that a business will do first and foremost is look after itself to make profit and continue to employ people.  Boards will always reflect society from 30/40 years ago which is something we can’t really change unfortunately, however on saying all that I would be more than happy to hear from female/ethnic minority candidates for NED work within investments and pensions!  Literally, the more the merrier.