Are you a consultant or person who could become a non executive director?

So why are ABAN interested in Non Executive Directors, team members and consultants.

 

So why are ABAN interested in Non Executive Directors and consultants.

There are many reasons including:-

  • Many businesses, like and often need to create a rounded management team.
  • Some business angels do not want, or have the time to become individually involved so like to have a non executive director appointed to look after their interests.
  • With consortiums, it can be that the number involved, means it is more suited to having a non executive to represent their interests rather than forming a very large committee on the board.
  • Some company boards require balancing, with an independent view, particularly where you have two strong directors with an equal shareholding.
  • Often as a business grows, some of the founding members find they are out of their depth, and it is then essential to be able to add support either as non executive directors or consultants who can empower them to continue.
  • Businesses are often entering a new  and unknown phase, and adding extra experience, can be not only helpful but also reduce risks.
  • There are often other routes, such as growing by franchising, where it is beneficial to have the input from people who have already gone down this route before.
  • The need often arises to get a specific task done, and commissioning a consultant to undertake this may be cost effective and expedient.
  • The businessman just needs to buy in expertise for a period, to manage change, expansion or resolve a problem.

While many non executive directors may initially see this as a one off activity, that can be done alongside existing employment, or running your own business, some now see this as a major part of their life and hold a number of non executive directorships. Some also see it as an activity that can be developed, expanded and carried on after retirement, allowing the expertise they have acquired to be shared with others.

In the future it is likely that becoming a non executive director will become a more widely seen career choice with people developing their skills in management in large or small organisations before taking on a range of non executive roles. At the moment although there are very many thousands of non executive directors, it is not an area that is widely understood or considered by many.


ABAN therefore sees this as an area where we need to have an active involvement. This includes developing consultants and non executive directors as well as putting people in touch with each other.

On the other hand ABAN as a member to member organisation, has no desire to become anything similar to an employment agency. But rather to handle this as a member to member service as we do other contacts.

The working is therefore quite simple, and members, and this includes our free members, who feel that they would make a suitable non executive director or could offer expertise as a consultant, submits information that can be reviewed by ABAN and held. The information is in a set format, and forms two files of information, one for consultants and one for non executive directors. You can find more more details on how to do this on our member website. Applications also comes through Business Club International (BCI).

Those who choose to also become Personal Plus members, are invited to meet either the ABAN chairman or another senior consultant, and we can discuss with these people how they can better present their experience and abilities as well as making notes ourselves so that we can consider recommending them when a suitable opportunity arises. Those that join the consultancy panel, as Personal Plus Consultant members, are far more involved in these areas, and both developing their abilities and meeting those who are likely to utilise their services.

Consultancy panel members will also have access to the information on available people who feel that they could offer consultancy services, and of course will get the opportunity to meet all types of members.

We have no intention of putting any information on individuals onto either the public or any of the member websites, or allowing the wider membership access to this database without the assistance of a member of the consultancy panel or the chairman of ABAN. BCI does have a listing of its members who wish to be listed on their website as consultants. 

There is a separate panel looking at potential non executive directors, membership is by invitation only,  that seeks to make recommendations of suitable candidates for both BCI and ABAN members. 

Personal Plus members looking to find a non executive director or consultant will be able to gain introductions through the ABAN chairman, as a part of their normal service.

ABAN does not currently make any charge for any aspect of this. We are considering adding at some point a small filing fee, to non Personal Plus, and BCI members, to cover the cost of the maintenance of the database.

Development is encouraged in many ways including for Personal plus members, through the Experion project where all those involved in these small companies have the opportunity to gain experience as a director and become involved in simulations, but also through a special consultants panel set up within ABAN Plus.

If this is a specific area of interest to you, then you have, as you will see, a variety of options.

If this is of passing interest, or lower priority, then join for free, register for free and wait.

If you feel that this is an area that you could become actively involved in and would like to see progress, perhaps as a single role to start, and see where this goes, then consider registering free with ABAN and also signing up to the optional ABAN Personal Plus Membership.

If you are considering multiple non executive directorships, or consultancy roles and see this becoming a major part of your life then register free with ABAN  and join the optional ABAN Plus Club as a Personal Plus Consultant  member.

What next. Read the rest of the sections of this website, and make up your own mind.  The decision to join ABAN of course opens up many other opportunities as well. Once you join ABAN you have access to the member website that has a lot more information, including detailed articles, covering these areas in more detail.

The non executive, and consultant selection procedures are managed by ABAN but run in cooperation with Business Club International, so if you are a BCI member take a look at your member website exchange section and articles sections for information.

Can You

Identifying information

Consider all options

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Some questions answered.

What does a non executive director do

A non executive director is like any other director, other than they are not involved in the day to day running of the business, they attend board meetings, may be a part of working sub groups, may be involved in interviewing panels, and in setting the remuneration of executive directors. Some have special skills or knowledge, so also advise the company in these areas.

What are the basic qualifications and requirements.

Clear thinking, ability to grasp facts fast and see alternatives, ability to communicate and to take part in group decision making processes in a cool manner. In some cases the ability to present the views of the person that appoints them rather than necessarily their own views.

A good credit status may be important in some cases, where the directors are seeking funding through banks or obtaining mortgages. Although they should never be asked to give personal guarantees, lenders will take the individuals behind a company into account in any lending situation.

Qualifications are not usually valued greatly but relevant experience is.

How are non executive directors paid

This varies from company to company. In many companies its a flat directors fee,  averaging 15k-20k a year.

In some cases where the expertise of the individual is of major benefit and perhaps they are slightly more involved, then a fee plus some sort of reward based on targets being reached or profits.

You may also get expenses or other allowances.

How many non executive directorships can a person have

There is no limit other than in juggling your diary. With small companies often board meetings are short and so in some cases several could be fitted in, in a day.

You also need to be able to separate the companies, they should not be competitors.

Some companies such as property holding companies meet very infrequently, so in some of these cases you may only actually attend 2 meetings a year. In some cases there is a group of companies  involved, so you may be a non  executive on a number of connected companies.

In some cases non executives are added just for their name, or status, but we are rarely involved in these.

We can't therefore answer this question but active executive directors are in some cases a director of over 20 companies.

Who appoints them

Directors are appointed by shareholders.  In the case of a large corporation this is done by election at the AGM, but in smaller companies its often in practice the people who have invested in the business that have been involved in the appointment of non executives to look after their interests. In some cases existing directors will invite onto the board non executives to widen the experience available or make it more appealing to potential investors. On rare occasions a very major client or customer may insist on extra expertise being added to the board before committing to an order.

What are alternate directors

In some cases an investor will become a director himself, but not have the time to routinely attend board meetings, in which case he appoints an alternate to stand in for him and report to him, only attending when he wants to or a problem develops. Alternate directors are like non executive directors but usually paid, but their reward package is arranged with the director they are standing in for.

What about being a mentor

Mentors tell people how to do things and encourages them. Their role is that of empowering others, they don't undertake tasks themselves. In many cases a person may be a non executive director and a mentor.

How does being a consultant compare

Consultants are employed by the company, rather than being part of the management team. May be rewarded on a time basis or performance, and usually involved in a single task rather than across the company.

Are consultants well rewarded

This varies from one assignment to another, on the projects, what you charge, and how efficient you are. In many cases people are rewarded for a task, if you have the expertise to achieve it quickly your hourly rate is high, but if you don't and you have to learn first then you gain perhaps more in experience than from the effective hourly rate.

Can I be both a non executive director and offer consultancy to the same company.

Yes, but often you are excluded from discussions on the consultancy contract. It is however not uncommon for the agreed initial package to include both.

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