Directors Blog July 2011
MD Garry Sheriff & FD Michael Jopling take a look at the importance of non-executive directors.
A recent report from Coutts confirming the benefits of non-executive directors (NEDs) comes as no surprise to those who have long appreciated how bringing new DNA into an organisation can boost its fortunes.
A good NED is the best kept secret behind many a successful organisation, with around 6,000 of them working with the UK’s top 1000 firms.
The value of an impartial expert who is focussed on strategic direction and the big picture, rather than the day to day running of the business, cannot be underestimated.
Because a NED is not involved in internal politics they bring an independent viewpoint to the table. Got an elephant in the room or a difficult question that no one else wants to air? Unsure whether to grow the business organically or through acquisition? That’s when you need the unbiased, constructive advice that will only come from a NED.
Of course if you are looking to appoint, the really tricky bit is to find someone with the right experience, background and personality – and someone who believes in your organisation and can see the potential to add value.
Our own NED is Andrew Hoyle, head of strategic recruitment and projects at law firm Ward Hadaway. We were lucky that Andrew’s desire to take up part-time interests outside of legal private practice coincided with our need to bring in new blood to help us shape and grow the business in the right way.
When we discussed the idea of bringing in a NED we were keen not to recruit in our own image, but instead look to add to our board level skills set.
Andrew’s experience brings a different dimension to the board and because he’s both trusted and respected by the directors he can constructively challenge assumptions where necessary – a crucial part of his role.
And it’s a misconception that only the big corporates benefit from NEDs. If anything, it’s the smaller businesses and SMEs that can benefit the most. ITPS is 10 years old and while we have a very healthy £10m+ turnover, it’s no secret that we are hungry for growth.
But being honest, when you’re very close to the business and have built it up from scratch and more than 90 people rely on you for employment it can be hard to step back and see that your ‘baby’ has grown up and might have different needs. That’s where the advice of a NED is invaluable.
Andrew has been working with us for several months and we’re already reaping the benefits of his wide-ranging experience in growing successful businesses.
We would like to see more SMEs to take advantage of having some objective expertise join them at the boardroom table.
Investing in a NED is one of the smartest decisions a business owner will ever make – if they are serious about fast-tracking their growth.