Gaining a NED appointment can sometimes be the most challenging part of your board career.
I often speak with executives that are looking to embark on a career in governance but either: have no idea where to start or; they think that, because they have already enjoyed a successful executive career, placement on a board will come easily. However, as many who have made the journey can attest, it can be a long and arduous journey from executive to NED, especially if you don’t know the right steps to take.
A senior Non Executive Director said it took him a year to secure his first NED appointment; this despite having 20 years executive experience as both CEO and financial director of a FTSE company. He stated that getting started as a NED was ‘reasonably difficult’.
Whilst it’s not always easy getting that first NED appointment, there are a few things you can do that will allow you to make the transition successful and worthwhile.
To begin with I would advise people to look for a NED role while still serving as an executive. So that, when you come out of your career, you can point to that NED position when seeking other roles. I think intuitively, many know that this is the right thing to do but it is often not until towards the end of your executive life that this really rings true and the pressure mounts. In fact, I spoke with an experienced CEO in this position just yesterday. He said that he should have started his board journey 15years ago!
Below are some first person accounts of how others have achieved their board aspirations.
Colin Smith, Non Executive Director at Hilton Food Group and Poundland (where he was also Chairman from 2002 – 2012) said it took him a year to secure his first NED appointment; this despite having 20 years executive experience as both CEO and financial director of a FTSE company. He stated that getting started as a NED was ‘reasonably difficult’.
“I would advise people to look for a NED role while still serving as an executive. When you come out of your career, you can point to that NED position when seeking other roles.”
So how did Smith get his foot in the first door?
“I visited headhunters, networked all my contacts and spoke to every private equity firm I could get hold of,” he said.
As a non-executive director Smith, a chartered accountant, contributes his business expertise. He is attuned to what is required in terms of governance, good standards and control.
“I like to be involved where I can be engaged. I don’t want to run things but I am not the sort of person whose only contribution is to turn up to a board meeting once a month. I have contributed expertise and gained a lot of knowledge and understanding of different business situations.”
Steve Acklam, former chief executive of the School Governors’ One Stop Shop (SGOSS) reckons a popular route to becoming a NED is to first gain valuable experience serving as a school governor. Although it’s a voluntary role, governors have the same authority as a NED in a company.
Acklam stated: “Even a primary school may have a budget of £2m and 60 or 70 staff so all these issues related to running a business are within the school setting too.”
According to Acklam the duties of the school governors’ board include appointing the head teacher, setting and controlling the budget, managing strategic direction and making sure the school delivers high-quality education. You shouldn’t find it hard finding a role as school governor, since there is always a need for people willing to fulfill this role.
IoD lead governance tutor Paul Mundens said that experience always counts. Apart from gaining valuable experience as a school governor, gaining positions on the boards of housing associations and the charitable sector can also help fill your CV.
Mundens pointed out that not every NED position will be advertised for open interview – “the NED is the last bastion of the tap on the shoulder,” he said – but where they are, many interviewers don’t understand the role of the NED.
The interviewer doesn’t always know what they are looking for, so think about what you can bring to the board to improve the organisation. Pick the brain of the chairman beforehand. You should be asking him questions about what issues concern them and what the big risk issues are. Understand what you can do to improve the governance or the direction of the organisation.
Where to Start on Your Journey
Listening to the advice of others and telling people you want a board role are good ways to start your journey. However there is much more you can do. For this reason, and with over a decade of working as a headhunter and helping people gain board roles, I wrote the book Board Appointments: The Definitive Guide to Gaining a Non-Executive Directorship especially to help those who want to drive forward towards finding and gaining a board appointment. I also developed the Board Ready Course.
Don’t forget that whatever you do you must ‘dare them* not to appoint you’.
MD, Board Direction