Non-Executive Directors   Non-Executive Directorships   Have you ever thought of becoming a Non-Executive Director (NED)? At The Panel, we have a number of clients looking for high-calibre individuals to do non-executive directorships.   As a NED, you can add significant value to businesses in a number of different ways. These include adding specific sectoral expertise, sharing your business acumen, introducing your network of relevant contacts to a business and act as an INDEPENDENT sounding board on issues affecting the business. Attributes we look for before registering a NED on our Panel:  A significant track record of achievement in business at a senior management level. An independence of mind and clarity of thought. A specialised commercial or relevant technical expertise. An ability to question incisively. A control element/ability to enforce governance at board level. An ability to offer strategic guidance to the business. A set of skills the company may not have already. A number of references we can check. Ideally, but not necessarily, a Chartered Director qualification. If you feel that you can offer these attributes to our clients, I would like to hear from you. For more information on joining The Non-Executive Directors Panel, please contact Paul McArdle , Director – The Panel on (01) 6614771 or paul@thepanel.com. A NED will normally attend board meetings and other meetings as pre-agreed. For example, a company may use NEDs as part of their recruitment process to interview potential senior hires. What is the role of a NED?  Contributor to the business Challenger of executive proposals Contact provider Confidante Conciliator Checker of board processes Crisis manager Coach/Mentor executive directors Consultant Compensation reviews Conscience of the company They DO NOT get involved in the day-to-day running of the company. How are NEDs remunerated?  Normally NEDs get paid an annual fee and expenses where appropriate. Depending on their time commitment, the fees can vary widely from €10,000 to €100,000+ in some publicly quoted companies. For SMEs we are seeing fees from €10,000 being paid. Independence:  The NED is an independent individual and the UK Combined Code sets out guidelines on how this independence must be determined and maintained. The Combined Code has been adopted by the Irish Stock Exchange and applies to publicly quoted companies. It is good practice for privately-owned companies to adopt the same standards and very useful for NEDs to be aware of. NEDs must not:  Have been an employee of the company in the last 5 years Have had a material business interest in the company for the last 3 years Receive income other than director fees Participate in the company’s share option/performance related remuneration or pension scheme Have close family ties with company advisers, directors or senior employees. Have conflicting cross directorships Represent significant shareholders Serve as a NED for more than 9 years with the same company Becoming a NED:  It is very important that you do your own due diligence on client companies before committing to joining their board of directors. Questions you should address include: How is the company run? Can I add genuine value? What is expected of me? Are there any potential conflicts? Can I check the bona fides of the company and its officers independently? Will it restrict me from taking other NED roles? Will I enjoy it? Number of board meetings, travel required etc…? How am I remunerated? Term of engagement? Induction for a NED: It is highly recommended that after joining a company as a NED, you ask them to prepare an induction plan where you can meet as many of the key players in the business as possible and get up to speed on all the pertinent issues affecting the business.   Very useful links: The Institute of Directors in Ireland – Chartered Directors Qualification: A one year course run by the IOD. http://www.iodireland.ie/CharteredDirector.php The Institute of Directors in Ireland – One day course on the role of the Director: Highly recommended course run by George Bartlett on behalf of the IOD. http://www.iodireland.ie/DirectorsEducation.php Michael Smurfit Graduate Business – Diploma in Corporate Governance: Full time course run by Professor Niamh Brennan. http://www.smurfitschool.ie/executiveeducation/centreforcorporategovernance/diplomaincorporategovernance/  Michael Smurfit Graduate Business – Half Day Courses: Half day course run on different directors topics given by Professor Niamh Brennan. http://www.smurfitschool.ie/executiveeducation/centreforcorporategovernance/directordevelopmentprogramme/ The Combined Code on Corporate Governance: http://www.fsa.gov.uk/pubs/ukla/lr_comcode2003.pdf Review of the role and effectiveness of Non-Executive Directors – Derek Higgs: This is a very practical and easy to read guide and is the UK standard. http://www.berr.gov.uk/files/file23012.pdf Turnbull Guidance – best practice internal controls and risk management: Guidelines for boards. http://www.frc.org.uk/documents/pagemanager/frc/Revised%20Turnbull%20Guidance%20October%202005.pdf The Office of the Director of Corporate Enforcement – Quick Guidelines: Excellent 8 summary 'Quick Guides' on the duties and powers of company directors, secretaries, shareholders, creditors etc… written in plain English! http://www.odce.ie/en/media_general_publications_article.aspx?article=f3575030-291a-4fbc-b472-56126635ad0f