So you wanna sit on a Board?

Consider carefully

I get told this often by many people who are early in their careers.  They see their end game as sitting on a board.  They see this as quite glamorous and exciting. Nothing could be further from the truth. 

Here’s a few reasons why you may want to reconsider that choice. 
1.  Firstly you carry a lot of legal liability if you hold this post.  Both commercially and criminally.  Being a responsible director involves a lot of compliance and doing the right things!  That’s not easy. 
2. The compensation is way below being commensurate with the responsibilities bourne and the risks taken on.  It’s more lucrative to consult to a firm than to be a director in general. 
3. The board meeting involve a huge chunk of your diary from prereads to actual board meetings and signing many legal documents.  That can really stuff up your diary if you have more than two or three.  I once sat on ten boards at one time.  That’s like having three full time jobs on the side while you have a full time job. 
4. The rules around how you trade shares are quite onerous and complicated.  As a general rule I don’t hold shares in the firm on whose boards I sit.  This removes a huge chunk of the compliance burden. 
5. You need to make a lot of disclosures about your interests and possible conflicts.  This is really important in the eyes of the stock exchange rules for listed firms. 
6. Debates can be long and draining. And that’s tough when you don’t have an economic interest in the outcome. 
7.  You better have an eye for detail and process.  Failure on either point can land you in jail. 
8.  Board seats get reviewed regularly so your long term tenure is never guaranteed. 
9.  If you can’t speak out truth to power and hold your line then this is not a role for you. 
10.  Dealing with excos is tough as is knowing to be aware of what you don’t know.  That combined with having the necessary empathy and mindfulness make for a rare combination. 
But if you still keen on doing this then you should know that there is almost no qualification that can prepare you for this.  Directorship training is all about process.  The real value you add is about your work experience  , the way you think and who you are as a person. 

Only for the brave indeed! 

Share this post