How companies can improve corporate governance by appointing a Non-Executive Director

January 26th, 2010 by admin

In today’s corporate climate staying on the radar is critical to success, particularly if you have a public company and are listed., however the public exposure has its risks and when things go wrong the same press that praised your outstanding achievements and was ready to take your press releases and make copy for publication will now savor in the opportunity to take your high public profile and drag you and your company through the mud.

 

How do you avoid such disastrous situations, the first step is adherence to good corporate governance principles. In structuring your board you will be a target for criticism if the board is stacked with loyal followers from your management team. Their first responsibility is to themselves, survival being the first instinct and corporate promotion being the next, if they are worthy of your management position appointments. The most distant thing from their mind would be to rock the boat with suggestions or criticism of their leader, the board as a whole or any of the collective decisions.

 

How do you avoid such a dilemma and keep your management intact at the same time. Enter the role of the non-executive director who is charged wit the primary responsibility of independent thinking and decision making. Presto, you have balance and can function as a board with balanced views on subjects, free from the shackles of company management. It does come with a pre-requisite that you make the Non-Executive Director appointments correctly, but with careful consideration you can structure your board for integrity and performance.

 

Your company will reap the benefits of improved corporate governance and minimize the risk of poor decisions or biased decisions thereby taking you on a path of confident success. It will be immense benefit and comfort to ensure that your press coverage is about positive news your company has to report.

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