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Essentials of an Effective Board: Roles, Responsibilities, and Recruitment Strategies

This comprehensive guide by Isabelle Bearn-Fournier outlines the core principles of effective corporate boards and their governance structures. It highlights the distinction between executive and non-executive directors, emphasizing the importance of accountability, transparency, and collective responsibility. The guide includes essential skills for a great Chair, the structured recruitment process for directors, and the significance of a diverse board in enhancing business performance. It serves as a valuable resource for organizations aiming to strengthen their board dynamics and governance frameworks.

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Essentials of an Effective Board: Roles, Responsibilities, and Recruitment Strategies

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  1. What makes an effective Board by Isabelle Bearn-Fournier, 15/03/201107719348140 – ibearnf@gmail.comisabelle@ffplacements.co.uk Management & Recruitment Consultant with experience of voluntary and public bodies; as well as of delivering results in marketing, operations, and business development in blue-chip and professional services’ organisations. Currently working on recruitment assignments sourcing Non-Executive Directors, Chairpersons, and Executives. BA, MBA, CIM, Dip in IP Law, SFEDI

  2. What control companies SHAREHOLDERS have rights & limited liabilities BOARD: ‘mind & will’, fully accountable, directors are directing not managing EXECUTIVE MANAGEMENT: owe duties to the company, must act in its best interests POWER & AUTHORITY can be delegated from the shareholders to the executive management RESPONSIBILITY: can be delegated from shareholders to Board and executive management to Board, but the Board cannot delegate it Follow the Corporate Governance Code principles: probity, transparency, focus and accountability

  3. Effective board engaged collectively responsible Chair leads the board & CEO runs the company balance of executives and ‘independent’ NEDs no one individual has unfettered powers of decision strong, independent committees talk openly, respect each other views, share a common vision regular review of its effectiveness

  4. A great Chairis one who • Communicate effectively to the shareholders, and shareholder views back to the Board • Set a relevant agenda • ensure effective implementation of decisions • style: Referee & mentor, coaching • to maximise contribution of the NEDs & ensure good dialogue between the Executives and the NEDs • ensure annual assessment of the board’s performance & that weaknesses -individually & collectively- are addressed • recommend the succession planning of members

  5. Key differences Executive DirectorsNon-Executive Directors Full time Part time Day-to-day, hands-on Hands-off Employed Self Employed Contract of employment Letter of appointment Not Independent Independent, Challenge Line responsibility for employees No line responsibility Executive responsibility No executive responsibility Execute company strategy Review company strategy Execute Board’s decisions Brings an outside perspective Micro or internal knowledge from wider experience

  6. Recruiting • Structured recruitment process • formal, rigorous & transparent procedures • Right chemistry  magic Board • Job/person specification specifying the required technical abilities, soft skills • Best profile to fit the company’s culture • Conflict of interests • Objectives etc. to be included in the Contract or Letter of appointment • Induction & Appraisal • Directors and Officers Liability Insurance (D&O) or equivalent for your sector or company structure • improving business performancethrough Diversity

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