Key questions for boards and their nomination committees to consider
- What skills do the board need to deliver the company’s strategy (over the relevant period) and deal with changes in the business environment?
- If the board needs new skills, when will they be needed and what is the plan for acquiring them?
- How will you manage the next cycle of board appointments and reappointments, and how do board and director evaluations feed into that process?
- What is your contingency plan for dealing with unexpected departures?
- What assurance do you need from management about the nature and quality of their executive and senior management development programmes? How involved does the board or individual directors want to be in those programmes?
- How visible are potential executive directors to you and what role might you play in their development (for example, through mentoring)?
- What is your policy on executive directors and senior managers serving as NEDs on other boards?
- What is your plan for ongoing training and development of directors after they have joined the board and how do the results from your board evaluation feed into this?
- What criteria are used by the board and its advisors to identify potential NEDs? How objective are they and are you satisfied they will not rule out individuals who have the necessary skills but may, for example, be lacking board experience?
- What processes do you have for assessing the character and behaviours of potential new directors?
- How could you improve your reporting and terms of reference to give shareholders and other stakeholders better insight into and assurance on the nomination committee’s exercise of its responsibilities?
- How could the nomination committee’s interactions with other committees, e.g. the remuneration committee, be improved?
Read Chris' full article, 'The fairest of them all', on the new nomination committee research produced by ICSA and EY.
Chris Hodge is Policy Manager at ICSA: The Governance Institute