NEDs NODs or NAGs?

I don't know about you, but over my career I have come across a variety of non executive directors; some true independent non executives, some who were shall we say, well less so...

To be clear - a strong and independent NED is indeed for life not just for Christmas, they are someone who embody that critical friend description, someone unafraid to speak up for what they believe in and to correct where necessary, but they are also informed and understanding of the business and therefore able to add to the building blocks of the Company. This is no mean feat - someone who can carefully (and sometimes quietly) critique yet at the same time be a champion and ambassador is a rare individual and one to hold on to. Where particular experiences and career exposure adds to the overall board composition then an independent NED can bring about introductions, new ideas, add creative input and knowledgeable comment, all from personal experience, well that carries enormous value yet is often missed or excluded when selecting an NED for the business. This is particularly so in the private company arena where the 'my baby' subconscious thought often drives decision making. Yet in every company, whatever the size, a good NED will bring benefits that far outweigh the cost and change to routine.

So, a NED is a critical friend, a mentor, challenger, agitator for good and also helps to balance the corporate conscience to ensure the business moves forward in the best possible way, looking after its stakeholders and working to secure the most effective and efficient path is followed.

Conversely, a NOD is the opposite - these are seen less and less but I have come across too many, those for whom the role is merely a requirement of the pension payment... Here and I remember one particular chap really well, where he would visit the business annually for a 15 minute (or less!) chat over coffee then leave with his cheque. End of, all done. A NOD will tend to be more noticeable in formal meetings where in fact the need for sleep outweighs the present and at first a zoning out occurs, hotly followed by full blown sleep. On waking they are often heard to exclaim 'yes' or 'indeed' and this will either somehow be seen to blend in or be totally out of kilter with the actual discussion at the time. Needless to say, NODs are unwanted and to be avoided at all costs even if the Board is struggling to find the right NED!

NODs can also be for life and so to paraphrase that Indian Jones movie - 'choose wisely'! It is far easier to hire than remove and you just might get more than you expected...

And then there is the NAG. You can see where this one goes but of course despite the obvious we often miss the tell tale signs. NAGs love to remind their colleagues of their own previous comments in the light of current problems or difficulties and relish the opportunity to play the I told you so.'s. A NAG though is at their worst when the heat is on - in tough times the Board needs to be a cohesive unit working together to resolve the matter in hand. A NAG will be just the opposite - in their haste to demonstrate their own un-involvement they will look to hang their colleagues out to dry - irrespective of the realities. It is vital to stop this at the earliest opportunity and to do that requires strong leadership from the Chairman and Board members - a NAG in the midst is destructive and risks implosion at any time. So beware - NAGs often masquerade as strong Board members and their true colours usually breeze into view at the first sign of tension or trouble. A tricky one to spot.

So if you are a Board member looking for a replacement or new NED, or an entrepreneur looking to broaden your expertise, bear in mind that a good NED can be a transformative addition to a Board, but beware the NODS and NAGS - they have the opposite effect.

And despite the light hearted nature of this short note, the serious point is that any NED needs to be qualified, competent, experienced and someone you can work with - if you cannot work together effectively and efficiently then there will be another fish in the sea. Just choice wisely!