While counselling and monitoring are felt to be typical roles for Non-Executive Directors, long-term strategic planning and provision of wider industry knowledge and contacts are also crucial, an Association of Chartered Certified Accountants (ACCA) survey of UK NEDs reveals.
The survey of ACCA’s 200-strong Non-Executive Directors database-which provides NEDs for growing companies – found that keeping sight of the bigger picture so as to steer the company in the right direction was vital, as executives often got swamped by day-to-day issues. Keeping management on track was a common theme as it was felt that classic entrepreneurs could take a somewhat cavalier approach and not conduct appropriate risk assessment. However, more emphasis is now given to NEDs providing broader industry contact and therefore assisting in the development of new business.
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Allen Blewitt, ACCA Chief Executive commented “It is interesting to find that the role of NEDs seems to be expanding to incorporate not only the traditional advisory position, but also strategic business development. The role of the NED appears to be changing with more focus on NEDs bringing their wider industry knowledge and contacts to the business”.