How to be the best company director
There has arguably never been a more important time for directors to understand the full extent of their roles and responsibilities…
The recent collapse of Carillion sparked a nationwide deluge of criticism about the conduct of its directors. The IoD was among Carillion’s fiercest critics and continues to be at the forefront of promoting good corporate governance in British boardrooms.
In fact, the IoD runs courses that provide existing and aspiring executives with the essential tools to become an effective and successful modern-day director.
This includes a module which focuses on the Role of the Director and the Board. Here, an IoD course leader and a managing director both tell us why it will help you to become a better director…
Steve Giles – IoD Course Leader
“The Role of the Director course combines two things that are very important. Firstly, it provides some essential theory to anybody who is looking to become a director or maybe is a director and is not aware of the extents of their duties, of their responsibilities and of their potential liabilities.
Secondly, it provides a lot of practical guidance on how the board itself should work to achieve its maximum potential. For example, how do you evaluate board performance? How does the board contribute to the effective management of risk in an organisation? How should the board be looking to refresh itself in terms of succession planning?
A lot of people are promoted to the role of director because they are good managers. That is fine, they’ve got great executive skills, but that does not necessarily mean that they will be excellent directors. One of the things that is often missing is that they simply don’t know what know their duties are as set out in the Companies Act.
“Directors are increasingly being held accountable for their actions. This is one of the legacies from the global financial crisis of 2008”
This very often is a real wake-up call and a jolt for many people who may not be aware of the extent of their liabilities.
We look at corporate structures, the differences between, for example, a public limited company and a private limited company. We look at how the role of shareholders, directors and managers are different from each other.
One of the great benefits of the IoD is that it has this capacity to bring people together with different experiences from different sectors, very often from different countries. That helps to make the course unique and special because people will learn that there are different ways of approaching particular issues.
“It’s essential that anybody looking to become a director is aware of this course to equip them with the tools for the role”.
Directors are increasingly being held accountable for their actions. This is one of the legacies from the global financial crisis of 2008, when we had some of our biggest financial institutions being bailed out by the taxpayer. Very few individuals were held to account for the part they played in that crisis.
The course continues to evolve and reflect these developments in corporate governance. It’s essential that anybody looking to become a director is aware of this course to equip them with the tools for the role”.
Paul McSharry – Managing Director, Kilborn Consulting
“I’ve been a railway engineer from an apprentice through to becoming an MD of an SME, although none of it was planned!
We are railway engineering consultants. We do work all over the UK and Ireland, covering a wide range of technologies and aspirations. It may be a new station or a new depot or the impact of building a bridge. As a small business you need to be fleet of foot, flexible and go wherever the demand is. You think about what is your USP over the big boys. For us, it’s competency, flexibility and cost.
We currently employ 12 people and it is a privilege to run a business, but it comes with responsibilities and because you’re in charge you end up with the title of director after your name without necessarily appreciating what the title means.
I’ve been a member of the IoD for five years. I always thought it would be a good institution to join for the support, advice and help, the phone lines, the meeting space – they are all good tools to have on your side. But I never fully understood the obligations of being a director.
I don’t have a board of directors, it’s just me. Also, most of the meetings I go to, the training I get and the peer groups I meet are all railway engineers, so I don’t get much external insight which is why the IoD’s courses appealed to me.
Understanding the legal obligations was an obvious benefit of doing this course.
“The range of people you get on an IoD course is so diverse and you learn so much from mixing with and listening to other directors”
Also, I want to look towards the future. When I get into the early stages of retirement I don’t want to stop working, and will look towards becoming a Non-Exec Director (NED) – a role that really interests me. So, I’ve also taken courses on Finance for Non-Financial Directors and the Role of the Non-Executive Director.
The tutors that I’ve had were fantastic. They bring so much genuine and practical experience but can also deliver it in such a way that makes it easy for everyone to understand.
The people on my courses were doing anything from spaceships to gold mining to banking to tyre manufacturing. The range of people you get on an IoD course is so diverse and you learn so much from mixing with and listening to other directors.”
By attending this course you will acquire the knowledge and skills to:
- Gain an in-depth view of the key duties, roles and legal responsibilities of the modern director
- Understand the essential differences between direction, management and ownership
- Examine the board’s role in corporate governance and learn how to improve board effectiveness
- Understand the legal status of a company and other organisations and implications of the Company Act 2006