The role of the non-executive director (NED) is a key one. In today’s corporate governance environment the management of risk is considered paramount; shareholders and stakeholders are watching companies and public bodies closely. High performing independent NEDs are essential ‘critical friends’ for management.They bring wisdom and sound judgement to the strategic direction of our companies and public services. They need the courage and integrity to challenge executive directors when it is necessary to do so. British companies benefit greatly from NEDs and it is essential that we work together to find, nurture and recruit the right talent to fulfil these vital roles now and in the future.
A decade of corporate governance
Today’s system of governance has evolved through Sir Adrian Cadbury and his committee who reviewed the financial aspects of corporate governance in 1992i. The review followed a series of failures caused by companies whose accounts were issued as clean but subsequently revealed significant financial irregularities.
Such scandals focus the mind and remind us that we must do better. Based on the ‘comply or explain’ principle, the Cadbury review was perceived to represent existing best practice and was widely accepted.
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