Becoming A Board Member, Non-Executive Director Or Trustee
You say board members and the first thing that comes to mind is a shady congregation of overlords that puppet the company from behind the curtain and are often more influential than the owners. Before becoming a board member, one must get to know all the strings attached – of which there are plenty. Certain personal qualities are needed and such positions are definitely not as glamorous as they are painted in popular culture. High levels of stress and saying goodbye to free time are just a few of the downsides of climbing to a seat on the board.
As the name suggests, a non-executive director (NED) is a lucky gal/fellow who does not take an active role in the day-to-day management of a firm and still gets an annual six-figure income.
Sounds like a dream job – acting as a drone in a beehive, getting the honey and not having to work for it. However, that is far from being the reality of the situation. Non-working directors have their fair share of responsibilities at the grandest of levels – planning, developing policies, and challenging the decisions of the executives. If you are okay with the mental image of a company being like an infant, then the non-exec is the babysitter, comforting it in times of trouble, and making sure it does not choke on small parts or hits its head decisively. As most babysitters, NEDs are happy when they do not have to have to intervene too much for mundane tasks. Nonetheless, they get excited each time they have to discipline some youthful naughtiness with their elderly wisdom 😉
The first aspect you need to evaluate is your motivation for being a board member.
Payment is a huge carrot dangled in front of you as you compete for a seat on the board. Raw statistics tend to suggest that the average salary for directors can be up to six times higher than the one normal workers receive. The higher you go on the Top 500 chart the more astronomical things get. There is a good reason why individuals holding cozy spots as board members have such salaries – they add to the game insight collected and matured throughout the many years of experience, a skill so hard you can scratch diamonds with it.
However, stuffing your bank account is not the only benefit. Being a board member goes beyond money and allows professionals to be in contact with the elites of their field. From a certain point in one’s career, going through courses and training becomes cumbersome. Traditional learning reaches a saturation point even in the most shape-shifting industries, and networking becomes the only viable option for growth. Industry leaders and influencers are the kind of crowd you would hang out with if you took up the challenge and became a board member!
Socially and professionally, being granted board membership is a major vote of confidence.
Common sense dictates that organizations install, at their very top, the kind of individuals that would benefit from the collective push the most. A large dose of prestige is derived from being a non-executive director or trustee. However, a couple of decades ago, the situation was quite different. Companies in need of exposure in the market took the road in reverse, and promoted board members that already had prestige. Celebrities and other kinds of influencers are often preferred to other more qualified candidates because of their ability to coagulate popular support and inspire trust at a subconscious level. Sometimes, being the most qualified for the position matters less, if your name does not echo well enough in the industry. Fortunately, such a practice has diminished and companies are now more careful when they choose their board members.
Being a board member makes you a guardian of the organization’s best interests, a superhero -> invested with the right to veto proposals and policies, wage an internal war against various factions, and protect the overall set of ethics and values lying at the core of the business.
As we all know, corruption and lust for power are attributes not limited to politicians. They exist all throughout human societies, and any big corporation will eventually accommodate some negative constructs that quietly work to serve their own greedy purposes. Repeated financial scandals have shown just how crucial it is to have someone trustworthy in charge to safeguard the interests of the shareholders.
Now that we’ve seen how equally rewarding and challenging being a board member could be, it is time to follow the breadcrumbs and see how one can land such a top-notch job.
Keep in mind that this is not a straightforward, vertical kind of approach you’ve seen elsewhere in the HR world.
Most boards suffer from what is called herd mentality and accept amongst their ranks only those who have already served other boards. Sound like a Catch-22?
You have no option but to accept it. However, there is a simple workaround. Instead of hunting your dream board membership, opt for incremental steps and build your experience by serving as a non-executive or trustee in startups or non-profit organizations. This is the point where you tap into the wonderful potential offered by networking. The people you meet can put their shoulders to work and raise you up the corporate ladder to your dream position. The next step is to seek affiliation to national associations of corporate directors and attend their sessions. No other type of effort that will ever get you closer to the professionals you admire and take as role models.
Again, the name should give a hint of the kind of the work involved. In a broad sense of the term, a trustee is the one that holds “property” on behalf of a beneficiary, the one entrusted with overseeing delicate operations and making sure they are on the right track. Trustees are often incorporated by boards of charities, volunteering organizations, or other non-profit entities. Such a position is generally regarded as easier to acquire than its corporate equivalent and less prone to create mental torment. Charities and even individuals need trustees because, well, even they have trust issues regarding management. Money flowing around means that some form of leeching will take place along the way eventually, hijacking the long-term goals for individual profit.
Trustees protect and preserve the “property” entrusted to them and defend the beneficiaries against any form of external or internal threat. You could see them as the guardian angels of bookkeeping, the heroes without a cap that make sure assets are managed under reasonable conditions. The more complex the trust, the more tact is required from a trustee. The job’s responsibilities are directly proportional to the equivalent market value of the trust.
Excellent people skills and impartiality are needed by those who want to excel at being a trustee. Because it deals with current and future beneficiaries or other people in these circles, such a board member might end up one day with the daunting task of having to choose sides in a conflict. This is where loyalty steps in to remind trustees that any personal preferences and commitments should come second to the mission he/she signed up for in the first place. Critical times in the life of a trustee are those when the trust goes through radical changes, either by absorbing capital or by breaking itself apart to smaller components. Like the immune system, the board member has to differentiate between real threats and normal physiology of the trust.
The higher you go up, the more likely it is to find closed doors, baffling bureaucracy, and scandalous secrecy.
Some companies go as far as to equip Executive office chairs with knives in the backrests. Relax just a bit and let the backstabbing begin!
In the rare occasion when they open their doors to new recruits, boards select based on two parameters – capabilities and character.
However, do not hope to revive your old CV and just dial in your impressive experience. Your bid needs to be sharp enough to cut a hair in two and go straight to the chase. Highlight the remarkable, the cornerstone of your corporate existence, distill it into one sentence that best describes your essence, and hope it is strong enough for gray-headed, balding directors that have done and seen it all.
The capabilities that recommend you as a potential board member are obvious, so we’ll not spend time talking about them. Character is the part that has the more profound implications on the job, and the trait which is harder to define. We probably paraphrase doctor Frankenstein when saying that character is that part of the human body that incorporates both the mind and the soul. It might sound strange, but intelligence all by itself would feel stranded on a chessboard where decisions often weight in the emotional and where the strongest always follow their gut feeling. Emotional intelligence is the single most important asset one can bring to the table when bidding for a place on the board. Being able to read people, earn their trust and judge with the blindfold on, are skills only the school of life can teach. A strong character gives the final touch to the approach that will earn you the position – stepping in front of the commission not as a person, but rather as a brand, as a product that has been thoroughly tested and validated at the highest of levels. Personal marketing needs to be flawless for the one that will soon become synonymous with the company in high circles.
Becoming active as a board member has its challenges. Although younger professionals are granted access more often now than before, it is impossible not to highlight that boards are conservative in their nature and tend to stick to the old ways if they are tempted with new ground. One must leave behind the torches and adopt a less revolutionary take!
Boards are very much like political parties. Transfusions of new blood are greatly appreciated, but the doctrine will never undergo radical change. The last one in still has to serve many coffees before he/she can have a seat at the metaphorical round table. Oh, and let us not forget how personal prestige tends to override the normal democratic processes you might expect.
Whether non-executive director or trustee, becoming a board member can act as a major career milestone, a coming of age that draws the individual in a gravitational field where responsibilities are a couple of times heavier, into a world where decision-making often goes political, and where pleasing all parts is impossible.
A board member needs to put on some heavy armor in order to withstand charges coming from all directions to test his/her integrity, impartiality, and commitment to long-term goals.
Although in a position of high power, board members should always remember not to be corrupted by it and always retain their humble pledge to serve instead of being served. One must let go of the romantic view attached to being a board member. Indeed, such a function is at the apex of the corporate world, but the glamor quickly fades away once one is handed the boots and asked to walk the murky road of impossible decisions, compromises, and the ever-present feeling that the rest of the board are secretly conspiring against you 😉
Board membership is the most obvious way to step up your corporate career and access a job worthy of an extended experience.
Although worrying due to of the number of responsibilities and the huge level of commitment, taking the seat of a non-exec or trustee can open world of opportunities, mostly by putting you in contact with people that act as the ultimate influencers. There is no hiding – life on a board is uncomfortable for a newcomer, at least until he/she establishes a personal doctrine and takes a “political” stance to align to one faction or another. Nevertheless, it pays quite well to oversee an organization and protect the interests of its owners.
The best way to know if the job is for you is to take it on and see where things go from there.
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