Joining the right board: due diligence for prospective directors

Member resource – advice for anyone considering joining a board on how to create a due diligence process to ensure that you have confidence in the company, and will be well suited to it

The Higgs Review on the role and effectiveness of non-executive directors (2003) recommended that before accepting an appointment, prospective non-executive directors should undertake their own thorough examination of the company to satisfy themselves that it is an organisation in which they both have confidence and will be well suited to working. This advice clearly remains relevant today; by making the right enquiries, a prospective director can reduce the risk of unwelcome surprises and dramatically increase the likelihood of success.

This guidance for prospective non-executive directors sets out how to undertake due diligence, and offers checklists of questions to ask in the following areas:

  • The business
  • Governance
  • The board
  • The role of the non-executive director
  • Remuneration
  • Investor relations
  • Risk management.

It also provides recommendations for further reading.

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