How to join a board of directors and get paid
This is a guide on how to join a board of directors and get paid. The demand for new and certified board members is at an all-time high. As society changes, boards must adjust to keep up. Do you have what it takes to become a certified board member?
- Board members from diverse backgrounds are in increased demand
- In the UK, big companies must ensure that 40% of their board seats are taken by women
- Certified board members with a broad range of skills are highly valued
- Boardrooms are changing due to new laws and increased shareholder pressure
- Board members are no longer exclusively recruited through traditional channels
- As a result of the Covid pandemic and recent social upheavals, many corporations are changing the composition of their boards
- Pay rates for board members in the UK are on the rise (read more)
There are an estimated 8.4 million board positions in the UK, with at least 450,000 in Ireland.
“Certified board members with specific talents will always be in demand,” says David W Duffy, CEO of the Corporate Governance Institute.
“Boardrooms have undergone tremendous change in the past two years, and the future will bring even greater opportunities for certified directors with sought-after skills. You should know how to join a board of directors.”
Every year thousands of boards go in search of certified, skilled directors. For example, there are an estimated 8.4 million board positions in the UK, with at least 450,000 in Ireland.
Old boards are under pressure
Due to recent global political and social turmoil, boards are under pressure to recruit members from more diverse backgrounds.
“Pale, male and stale boards don’t cut it anymore,” says Duffy. “And this is a good thing. Big investors and shareholders are also putting real pressure on companies to recruit board members from more diversified backgrounds.
“Inclusion, diversity and ESG are all significant forces driving change in boardrooms around the globe.”
Are you a next-generation board member?
There is a pipeline problem when it comes to recruiting today’s effective board members.
“Companies often looked for CEOs and former CEOs to fill board seats,” says Duffy.
“However, chief executives are rare and can lack diversity, so pulling candidates from a pool like this isn’t the best idea. Companies must instead look further afield for new members of their boards.”
COVID-19 has shaped the business landscape in a way that has never been seen before.
Before the pandemic, issues such as workforce policy, talent recruitment and retention, cybersecurity, brand risk, and environmental impact (ESG) were trending. Now they are top of board agendas, and boards need the people to help with such issues. how to join a board
Boards need more women members
Large UK companies are also under pressure to ensure at least 40% of board directors are women. The UK’s financial watchdog says it will address investors’ demands for greater diversity.
Besides the new target for 40% of board seats held by women, the Financial Conduct Authority also recommends that at least one senior board position be held by a woman i.e. the chair, chief executive, chief financial officer, or senior independent director.
“This is just the start of what will become a much wider diversity push,” says David Duffy. “Gender diversity is just one level of inclusion boards must embrace. There will be more requirements for boards to be representative of our society.”
California, for example, passed a law requiring businesses headquartered there to have at least one board member from an underrepresented community.
“I have a strong belief that we are soon going to see more diversity quotas introduced in all the countries that have laws and structures regarding governance,” says Duffy.
“This is good news, and it is an opportunity for more people from diverse backgrounds with multiple skills and talents to contribute at the board level.”