Non-executive directorships in the 21st century offer a challenging role – and that makes for an attractive career move. David Craik discovers how CFOs can best manoeuvre into position.
Non-executives are expected to play a greater role in business performance, although this was not the case even 10 years ago. The change has been driven by increased levels of boardroom regulation, seen since the 1990's Combined Code (which embraced both Cadbury and Greenbury's reports) and more recently with the 2014 UK Corporate Governance Code’s focus on risk management and high-profile governance failures, including Co-op Bank and Volkswagen. Investors and other stakeholders are demanding more oversight and control and NEDs are expected to play their part. In that atmosphere does the position still attract interest from CFOs either looking to end their career as a NED or take a position during it?
The supply is certainly there. CFOs still see a non-executive role as a boost to salary, a boost to prestige and increasingly a professional challenge. Mark Freebairn, of the CFO Practice at recruiters Odgers Berndtson, says the demand for financial expertise on boards is also there, and has been for some time. He looks back to Sir Derek Higgs's review into NEDs back in 2003.
This is an extract from the Finance & Management Magazine, Issue 250, January 2017.