How to find a paid or commercial board appointment

The process of gaining any sort of board appointment is competitive. However, commercial board appointments are even more so. They typically attract more experienced Non-Executive Directors (NEDs) and are rarely advertised. So, how do you find and, more importantly, get appointed to these sorts of boards? These are questions that I am asked regularly.

There are 5 types of commercial boards in Australia??

First, you must be clear on what sort of commercial organisation you want to target and could be appointed to the board of. In my experience, successful NEDs are really clear about this.?

1. Listed or Public Company Boards

For some, their board aspirations are in the listed space, whether small-cap, NSX, mid-cap, or perhaps an ASX 300 company. The skills and level of experience required to be appointed to these sorts of boards differ enormously. Without a significant profile or executive experience and NED experience, an appointment to an ASX 300 company board will be unlikely. However, a small-cap company doesn’t necessarily have the same standards or requirements. In fact, today I submitted a proposal for a NED recruitment assignment for a small listed company. In the brief, they stated that board experience was a nice to have requirement, not an essential requirement for candidates. Having said that, I know when they go to market, they will be overwhelmed by applicants with considerable NED experience, who will, on balance, surpass other candidates. On paper, this will likely be enough to get shortlisted for an interview.

2. Family Business Boards

In this category, we have massive family businesses, just as you have small family businesses. Because it is not usually compulsory, not all family businesses have boards. However, some do, and about 15% of NEDs operate exclusively in this space. Most credit their success in these roles because of their small ‘p’ political skills and ability to provide an independent perspective. Their skills, knowledge, and ability make the family board members/stakeholders feel secure. I often see these sorts of businesses recruiting external independent Chairs to help guide the business sensitively through the changes required to stay relevant for the future. If this is a space you want to operate, you must have a track record of working with or in similar businesses in a NED or Executive capacity.

3. Private Business Boards

Like family businesses, private businesses differ vastly in their scope and scale. They also pay considerable attention to ‘fit’ when contemplating the appointment of an independent board director. To demonstrate that you are a good fit, you really need to have worked with similar private businesses before. You need to demonstrate your ability to navigate the business dynamics successfully. And I mean successfully. To survive, these organisations need results. Funds are usually hard to come by, so every dollar counts. They will often see a NED as an overhead or potential burden, therefore only willing to take chances on people who can add value in dollars. On the other hand, governance experience is less of a concern, so is prior NED experience. These sorts of businesses are also more likely to have advisory boards than fully-fledged governing boards. Members of these advisory boards will have the same duties but without the same level of risk – though the argument about ‘shadow board members’ still rages.?

4. Start-up Boards

Every second person I speak to seems to want a role on a start-up organisation’s board. Traditionally, these companies utilise the expertise of advisory board members to grow or launch a business. As start-ups, they may not have an income stream or the liquidity to pay their board members. Instead, they might offer sweat equity or equity as a reward for involvement. Regardless of how you might be remunerated, be prepared to join an organisation that is usually task-focused and resource-poor. They may ask you to contribute your executive skills, valuable connections and networks. You should expect to get your hands dirty by rolling up your sleeves and getting involved in the organisation’s operations.?

5. Investment or Equity Boards – ‘value add directors’

Not all board opportunities are created equal, and some are plainly not board roles – despite how they may be promoted. It is the “value add directors” that I want to bring to your attention. The advertisements for these sorts of opportunities are often misleading as the true intention of appointing ‘value add directors’ is nothing more than a capital raising exercise. In fact, there are some consultancies in the marketplace that purport to advertise board vacancies when, in reality, they are capital raising for their clients. These are neither proper commercial board roles nor paid, though they will usually offer equity options.?

Instead, these sorts of organisations ask prospective board candidates to invest their cash as a precondition to becoming a board director. That is, of course, fine, as some are happy to do so. However, often, candidates only find out that the role is for a “value add director” once they have wasted their time with a formal ‘board’ application process. I have no problem with you investing in a company you think has a future. However, from a board career perspective, these sorts of opportunities are more akin to managing an investment than acting as a NED. They do not carry quite the same gravitas from a board career development perspective. My advice is not to entirely discount them if you have the time and the means to contribute. They can be fun and provide good learning opportunities while providing exciting, though sometimes risky, financial opportunities.?

How do you find commercial board appointment opportunities?

Finding a paid commercial board role is not dissimilar to finding any other sort of board role. In Australia, approximately 2.5m actively trading companies exist. A figure I saw somewhere (yep, I know, not very rigorous!) stated that just ~2.5% were large enough to have boards, which means there is something in the order of 60,000 commercial organisations with boards. That’s all well and good, but how many are looking for new NEDs?

From my research, 50% of organisations with boards recruit new directors each year. In my experience, over 90% of these commercial board roles are filled ‘informally’ i.e. without any formal application process, recruiter or advertisement involved. That means that whilst there are ~30,000 organisations appointing new NEDs each year, if you are seeking this sort of appointment but simply hoping for the right role to be advertised, or you are waiting for a recruiter to call you, then you are doing yourself a massive disservice. Having said that, there is no silver bullet – companies appoint new directors in any one of four ways.?

Here is my advice:

Listed Companies: Download the list of ASX companies and narrow it down by the location in which they are headquartered and the industry in which they primarily work that reflects your experience. Then, balance your aspirations with the reality of your potential appointment. Finally, reach out to past NEDs and utilise the information collected and connections made you to introduce yourself to the current NEDs. Doing this will demonstrate that you are proactive, informed, engaged, connected, less of a risk and more appointable. Moreover, you will be connecting with NEDs who sit on other boards that potentially are looking to appoint new board members. In fact, I have witnessed NEDs who carry with them a list of the companies they are targeting and the NEDs they need to speak to in order to gain these roles.

Family or Private Companies: Here, connections are the key. You need to engage directly or indirectly with the businesses and industries you are targeting. This will demonstrate your commitment even before proposing how you can help at the board level. Success only comes from researching comprehensively and being clear about how (the result) you can help. These organisations are incredibly risk-averse, so you must demonstrate that you are passionate about what they do. A great way to find these opportunities is via lists of these companies on the web. There will likely be lists circulating of private companies, often specific to location or industry – try searching ‘list of private companies in (your state)’. Or use AI to search for you by putting your specific search requisition into ChatGPT or Perplexity.

Startup Companies: These organisations?can be difficult to find, but there is a way. Try identifying incubators in your city or speaking?with PE (Private Equity) or VC (Venture Capital) firms or incubators. Failing that, a simple Google search will easily find a long list of companies.

How do you find the right people to speak with to unlock informal board opportunities?

Contact Out is a great tool we use to find the contact details of past and present board members for all of these sorts of companies. This tool is the solution we now use on behalf of our clients to solve the problem of gaining the email addresses of very specific NED contacts from scratch. It is unnervingly powerful and has a few exciting features, including a dashboard that lets you save and organise your leads. Plus, a search feature to identify the email addresses of people on LinkedIn and GitHub (a developer platform where developers create, store, manage, and share their code).

Don’t disregard formal application options and search firms

If you are interested in more significant listed or public companies, you will likely have to work with recruiters and headhunters. No firm dominates the commercial board appointment recruitment space, so you should speak with as many as you can. Significant board opportunities are also advertised – though not regularly and often by recruitment firms. To be successful, you will need a compelling Board CV, at the very least.

To complement any formal application process, you should always get to know and network with NEDs (both past and present) that sit on these boards. The more significant the organisation, the more critical it is that you are known by them. You can find these search firms by doing a simple web search and then contacting them directly to introduce yourself. To do so effectively, you will need a compelling board pitch.

Be proactive

Before starting your board search, consider these five types of boards in the commercial sector. Each of these requires different skills and experience. It is essential to know what these are so that you can target the most appropriate ones for you. By doing so, you will be a stronger candidate, have more and better conversations with those who influence the appointment process and provide access to opportunities you would never have found if you simply rely on formal application processes. Now, get out there and start connecting!

About the Author

David Schwarz is CEO & Founder of Board Direction – Australia’s leading board advertising and non-executive career support firm. He has over a decade of experience of putting people on boards as an international headhunter and a non-executive recruiter and has interviewed over one thousand non-executives and placed hundreds into some of the most significant public, private and NFP roles in the world