News
NED cost, Experience and ability to effectively challenge in the boardroom
Thursday 17th March 2022
Ryan Johnson
Having worked with over 40+ boards to review and assess the effectiveness of how they are run and ensure best practice is understood one of the key questions that management ask is do we have the right level of Non Executive Director (NED) on our board.
This question is always interesting as often there are very senior and high profile individuals that operate as NEDs on boards which whilst reassuring is not always the right answer if the NED has always been on the strategic, executive side running a firm and now being asked to scrutinise, assess the objectives which they don't always have the neccessary skill or level of comfort to provide.
The FCA recent statement on NEDs and damning comments support this view. Does it mean that experienced, high profile NEDs are not worth it? Absolutely not.
These high profile NEDs often require some training and understanding how they can best put into practice their experience and ability to assess things, ask the right questions without feeling uncomfortable.
The cost of being a NED is quite a range and whilst 'back in the day' it was always something that was a decent meeting with lunch / dinner the modern meeting NEDs often find they are much more intensive and focused to really help the firm achieve its objective.
What our research has outlined is that...
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