What is The Role of a Non Executive Director? ? Careers ? Career ...

A Non Executive Director is a very important role for any blossoming or existing business, and one that differs massively to that of an Executive Director.

First and foremost, the difference is that an Executive Director is also known as an Inside Director because of the way they are hands on with the business. Where as a Non Executive Director is also known as an Outside Director because of the way they are not affiliated with the company or business at all, except in strategising and governing the way the business is run.

Now, there is no actual formal list of duties that a Non Executive has to adhere to, this is because their role may differ slightly between companies. For example, at a relatively new business, they may act as a guiding mentor, and give independent advice based on their experience and business knowledge. However at a larger more established company, they may be employed to attend board meetings and scrutinise and strategise over business decisions.

Whilst there isnt a formal code of duties, because of the way companies and businesses will differ in terms of their requirements, there is however a list of responsibilities that was outlined by the Government in 2003 according to the Higgs Report. These Include:

Strategise

These types of directors are there to contribute to the business by formulating a business strategy. In this context they need to review and challenge existing plans and strategies until one is implemented effectively.

Scrutinise

As well challenging business strategies, these types of directors should also scrutinise business proposals and processes that are presented to a board of directors during meetings. This even includes the way a business is managed and the personnel that are employed. The Non-Executive Director then helps formulate new plans, sets new goals, and monitors the performance of said management.

Finding the Right People

In the process of monitoring the performance of management, this particular director is responsible for establishing the right people for the role. This means calculating the right number of people employed in management which fits with their strategy and business plan. In this instance, the Non-Executive Director also plays a significant role in the employment and thus provides the business with contacts for certain roles.

Provide contacts

Not only in the context of employment, but also in terms of general business, the Non-Executive Director also puts in place and formulates the right relationships between their contacts and the business itself. This could be anything from a client to a significant person that can contribute in some way to the business.

Confidante/mentor

This relates to the existing board members and Executive Directors. When they need some advice and expertise, they can draw on the knowledge and experience of the Non Executive Director. He/she can be there to guide and instruct on the best course of action. So again that may be by pointing out a specific way to do something or a contact to help implement a business idea.

Consultant and Crisis Manage

Moving on from the mentoring role, the Non Executive is also there as a consultant and in an extreme case to crisis manage. In this sense it is the skills and experience that is drawn upon, which most notably includes the way they can lead and deal with certain situations. Overall, as you have seen, this role really is about the way a Non Executive Director strategises and scrutinises the way a company is running their business. This includes monitoring performance, establishing goals and implementing procedures. They govern these processes as well as providing advice, guidance in the long run. Therefore, they can prove an invaluable asset to any business no matter how small or large.

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