Here, at the Corporate Governance Institute, we are often asked how someone becomes a paid board member, how does one get a role on a board? Download this eBook to find out.
Over the past number of years, the non-executive director’s role has evolved significantly. Successful independent directors need to challenge any governance breaches fearlessly in the boardroom and be solid independent voices.
Studies by the Association of British Insurers (ABI) have found firms that breach the City’s corporate governance code underperform, mainly because their boards tend to involve executive instead of non-executive directors.
Knowing how boards operate is also essential before joining a board. Did you know that less than 1% of board members and company directors in the UK are certified? Becoming a certified board member is essential if you want to be an effective director.
- Companies with good corporate governance and strong non-executive directors on their boards make more money – they are more valuable for their investors.
- Directors play a crucial role in policing the board, managing conflicts, and presenting factual information.
- Being a non-executive director comes with many legal obligations. An independent director who fails to challenge bad corporate governance or ethical breaches can violate the law.
- Governance relies heavily on the board of directors to observe an appropriate duty of care.
- Reasonable governance expectations are placed on all directors, specifically on independent, non-executive directors.
“The average pay for a board member of a UK Plc is £70,000. Boards are now actively recruiting more women and people from diverse backgrounds.” – Spencer Stuart
Boards want people from a variety of backgrounds
There is now a demand for board members from less ‘traditional’ backgrounds. Companies are increasingly pressed to diversify their boards by adding more women and underrepresented groups and executives with a variety of cultures and backgrounds to represent their customers and the people who work for them.
In the past, boards typically recruited directors from the C-suites of other firms, which is no longer happening as much.
More and more chairpeople have sought to support new participants from under-represented groups in developing their confidence to serve on a board in recent years. The option of becoming a board member is now open to everyone.
To become a great board member, you will need five different types of intelligence: financial, strategic, relational, your role and cultural intelligence. You can learn more about, and acquire, these types of skills by taking a Diploma in Corporate Governance.