Diversity in the Executive Pipeline

An article by Advanced Boardroom Excellence for the LexisNexis Company Secretary’s Review, Vol 38, No. 16, Published on 19 November 2014

In this article Helen Pitcher from Advanced Boardroom Excellence considers the need for diversity in the executive pipeline, and the important role played by non-executive directors.

As we consider the future of boards and reflect on past failings and misadventures it is important to remind ourselves of the capabilities and skills that non-executive directors (“NEDs”) are designed to bring to a company.

The role of the NED is structured to bring a wealth of experience, knowledge, capability and skills to a board which goes beyond the narrower confines of a specific company. NEDs should provide an individual and collective holistic view, based on wider experience, knowledge and insight, which has the potential to challenge effectively a specific set of notions. NEDs are not there to run a “shadow” executive, but to critique, support, encourage and illuminate the thinking and actions of the executive management team.

NEDs are the eyes and ears of the shareholders who are looking for a return on their investment and an important aspect of a NED’s role is to appraise and balance the short-term versus long-term gain for the shareholders. Their experience and knowledge enable them to make sound judgements based on the best information available to them with an ability to assess a profile which identifies long-term growth and wealth as a “value investor”.