We are pleased to include a guest blog from Frank Lewis, an experienced Chairman and Non Executive Director with a deep track record spanning 25 years as either Finance Director, CEO, Non Exec Director or Chairman within a wide variety of sectors and cultures. Frank is a successful entrepreneur who co-founded and grew South Africa's largest retail computer chain which he listed on the Johannesburg stock exchange.
He now succesfully manages a diverse portfolio of Non Exec Directorships which include rapidly expanding AIM quoted SMEs in the UK along with overseas ventures. He is actively involved in mentoring CEOs and SME Boards and working with entrepreneurs to grow their businesses.
Frank is an example of the type of Interim Chairmen and Non Executive Directors who Wyn River can access for our clients, especially but not exclusively those with operations in Africa. We hope you enjoy his assessment of the role of NEDs, and the personal attributes that are needed to fulfil the function successfully.
"The late “Tiny” Rowland once described NEDs as “baubles on a christmas tree” which revealed how little dominant chief executives expected to be questioned by fellow directors.
Since the glory days of the maverick empire of Mr Rowland between the 1960s and the 1990s, it would seem that nothing much has changed. He considered that many members around the board table were like baubles, doing nothing more than decorating the table. A non-executive director who challenged a powerful CEO such as Mr Rowland was not expected to remain a non-executive for very long.
This story is not over. The test for non-executive or independent directors is to prove wrong Lord (Michael) Grade, who once observed with characteristic wit: “A non-executive is a bit like the bidet in your bathroom: nobody is quite sure what they are used for, but they add a touch of class.”
The commitment and engagement required, especially in big businesses, is vastly greater than some might imagine. You are not there to be a bauble, have lunch, make polite conversation and pick up a fee. There is a job to do: a vital and challenging one.
I am sure most NEDs have come across many boards who are not tolerant of challenge and if someone speaks up or asks too many questions, they are branded as part of the “awkward squad”.
Lord Walker in a speech once said:- “The ability of NEDs to stand up to executive management is more important than the qualifications those directors hold.”
While there has been a whole lot of discussion about the need for NEDs with relevant experience, that knowledge is little more than useless if it is not accompanied by a willingness to challenge the executives.
In my opinion, my definition of a good NED is that he/she should: