Being on a board as a non-executive director has many challenges. Not least a concern as to whether or not one is being kept fully informed.

But whatever the difficulties, a non-executive is expected to manage shifting priorities and be on top of their game. By their very nature and background, non-executives will consider themselves to be capable, and be judged so by their non-executive and executive colleagues.

Yet however competent and experienced the non-executive, this may be an illusion. I, for one, have fallen for this illusion—but would suspect I am not alone.

Problems with board dynamics

After the honeymoon period, on first joining a board, it takes a little time to work out the precise board dynamic and the key issues to which attention needs to be directed. However if one does conclude that there are troubling board dynamics or one or more issues that might not easily be soluble then judgment is required.

The need for judgment may not be at all apparent. My natural reaction and indeed one shared by close colleagues is to make the assumption that whatever the issue, once identified the necessary actions to rectify difficulties and reach solutions will follow.

I had the additional responsibility of chairing the audit committee of the board of the company. As a result I worked closely with a bright young finance director, Carl, and the partner of a top tier firm of auditors. I concluded early on that Carl had some experience gaps and this was affecting the audit relationship. It was almost as if the audit partner played on the experience gaps and as a result Carl and the auditors grated to an alarming degree.

I fell into the trap of assuming I could sort out the problem. I should have been more mindful of the limits of my influencing abilities. Something did give in that we soon decided we should look to change auditors. That worked well initially but we were very soon again reminded that the finance director’s experience still fell short and the change of auditors had somewhat blinded us.

Wider issues

My failure was to recognise that the problem all along lay with Carl, and I had been naive to think that although I had the skill set I could raise his competence and experience. The grating relationship he had had with the original auditors was symptomatic of wider issues.

I started to form a view that other directors had known for some time, and from before I joined the board: that Carl talked a good game but had a number of gaps in his armoury. No one had let me in on the secret, and I had tried to address it by being more “hands on” and supporting Carl to help him raise his game.

With hindsight this was an illusion all round. I had not been fully informed as to the finance function and this was impacting the board dynamic. By the time this all became apparent I was seduced into believing I could address the issues. The judgment I failed to make was whether, as soon as I had this analysis, I should have pushed to change the finance director or—because of the board dynamic issue—even remained on the board.

It is almost too easy to try to be the quiet hero and set out to solve the board’s problems on one’s own. Clearly others were prepared to leave me to do the heavy lifting and even to see me fail.

The Secret NED has served on the board of a number of public and private companies, including leading an IPO.