Companies are extremely well-equipped to find even the most obscure information about potential Non-Execs joining their board. Conducting thorough due diligence checks on candidates is just good business sense. But, it goes both ways. Or, at least it should. As a NED, you take on a legal responsibility when you are appointed in a new role, so you cannot afford to not do your own research on a company before accepting a position. Don’t brush over this step as it helps you to know if the organisation is a good fit for you and your needs as a Non-Executive Director.
We asked our NED Community what due diligence checks they do on a company before accepting a board role and here’s what they had to say.
Engage with everyone
Making the effort to speak with as many people connected to the organisation as possible will give you invaluable nuggets of information, as Nigel Hall, a Board NED and Chair on the Innovation Board at Worcestershire LEP, Board Chair at Betaden Tech Accelerator, and member of our Dynamic Boards NED Community advises. “I do the ‘360’ method,” he says. “Engage, ask questions and listen to the Chair (unless it’s a Chair role), management team, customers and people in the organisation at as many levels as possible. I use a simple question ‘if you had 3 wishes for the organisation – what would those wishes be’. It’s amazing what you learn.”
Engaging with employees at all levels of an organisation can reveal a lot about an organisation and its dynamics agrees Stewart Davison, Vice-Chair of Elim Housing Association, a Non-Executive Board Member for Taff Housing, Trustee at Platform, and member of our Dynamic Boards NED Community. “In a chair role I was interviewing for there was about a 15 minute delay before I went in so I engaged the receptionist in a conversation about her role, what challenges she and the team faced, asked her if she was happy to give me a little tour of the offices and just chatted,” he recalls. “That gave me a good steer on the organisation and its culture,” he adds.
Asking direct questions about any concerns or gaps the company needs to address will give you an understanding of their culture of transparency and their ability for self-examination. This works particularly well in a one-to-one situation where people are more likely to speak more openly and honestly. Don’t forget to also speak to different customers to build a picture of brand perception and to understand any obvious bottlenecks.
Follow the digital footprint
Alongside checking the company website, doing a simple search on Google for the company name might bring up some interesting results (depending on how well the organisation is doing at managing their reputation online). In addition to reading about what the company says about itself, it’s also useful to see what others have said about it too. Don’t neglect to check Google News as this will display all of the articles and blogs associated with the brand across the web.
The next thing to look at is the company’s reviews. Glass Door is a great place to see what previous and current employees really think about an organisation and this can give you an honest insight into the culture of a company and any hidden problems. Google reviews, Trust Pilot and Social Media are all good sources for understanding how customers are receiving the brand. Finally, it’s always worth searching for anything on the Exec and NEDs/ Chair to get a flavour for who is running the organisation from the top to help you decide on whether the organisation would be a good fit for you.
Search your network
Tapping into your own personal network of colleagues, acquaintances, friends and family can lead you to a direct contact of someone who’s connected to the company at some level or has useful insight into the organisation you are considering. LinkedIn is a quick way to find a list of your existing connections that would be good to approach and connect with for some intel.
Deep-dive into the detail
Take the time to carefully read through publicly available information such as the annual report and accounts. Although some of the content may be generic, there will often be a narrative that has been written and approved by the senior team. Analyse the language and the way the data is presented to reveal things under the surface surrounding performance, risks and culture. The devil can sometimes be found in the detail and can reveal things that the figures don’t tell you.
What else do you find helpful when you are doing your diligence on a board you are considering joining? We’d love to hear from you. Drop us an email on hello@dynamicboards.co.uk.
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