Managing the process that encompasses succession planning, nomination and director recruitment is
one of the board’s most important tasks.
One such change, under Recommendation 2.2, is the need
to disclose the company’s board skills matrix which shows
the mix of skills and diversity that the board currently has
or is looking to achieve in its membership.
encourages market confidence and allows comparisons between organisations.
Yet many directors take this step without sufficient reflection on the possible risks in terms of personal
financial liability and reputational damage, and without sufficient investigation of the particular
company, industry and people involved.
As you gain boardroom experience and build your
networks, other opportunities will arise.
Directors will be appointed to the board because
their specific skills, knowledge and experience will fill particular gaps on the board.
constitution is always an excellent starting point for a director or board faced with this situation.
At law they have the same duties
and responsibilities as other
directors. In the United States,
executive directors are sometimes
known as inside directors and are
quite common there relative to
This is not the same
as an independent director who is one who is not only not employed by the organisation
(non-executive director), but also has no relations with the organisation other than being a director.
Current good practice recommends that a majority of directors on listed company boards be independent
The key goal in selecting directors
is to build a mix of individuals that
can work as a well-rounded team.
It is important to understand that the disruption that occurs when companies change their CEOs and chairs in too rapid succession takes a long time to repair.
The following types of directors will
be discussed: alternate director, chair, de facto director, executive director, non-executive director,
independent director, lead director, managing director, nominee director and shadow director.