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The role of an NED


Posted on 11/03/2016 by

Following on from our recent blog outlining how an NED can benefit your business, we thought it would be helpful to outline what the most common key responsibilities are for NEDs in our experience.

Here are the four main tasks NEDs are usually expected to undertake:

1. Providing strategic direction

  • Using their experience, specific knowledge and functional expertise, NEDs provide constructive input to strategic plans improving services and organisational effectiveness.

  • They will also contribute to the delivery of strong organisational governance, ensuring the organisation is operating in the public interest and in a transparent and ethical way to fulfil its objectives.

2. Monitoring performance

  • Non-executive directors monitor and scrutinise the performance of executive managers in meeting agreed goals and targets, especially with regard to achieving company strategy and objectives.

  • NEDs can be responsible for determining appropriate levels of remuneration of executive managers, and can also have a prime role in succession planning and appointing executives.

3. Communication

  • Non-executive directors often serve on high level board and committee meetings, taking part in discussions with the chief exec and other directors.

  • Another important function for NEDs is connecting the business and board with networks outside of the business’s usual reach, of potentially useful people and organisations.

  • In some cases, the non-executive director will be called upon to represent the company externally and provide opinions.

4. Managing risk

  • NEDs can be expected to attend meetings with regulatory bodies and to ensure that all auditing requirements are completed.

  • Non-executive directors also ensure that all financial information is accurate and that financial controls and risk management systems are robust and defensible.

To find out more about recruiting an NED into your business, please visit: NED Recruitment.

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