Mastering Your NED Role : The IoD's Director Competency Framework

Ever wondered how you're doing as a Non-executive Director (NED)? If you're looking for a guide to help you benchmark your skills and mindset, you're not alone. The Institute of Directors (IoD) 's Director Competency Framework is a resource I turn to regularly—it’s a great way to check in on my progress, see where I’m strong, and figure out what areas I can improve.

Here’s an explainer on the different facets of the framework and why they’re important to your development as a NED.

Knowledge

The knowledge you need as a NED is really the foundation of everything you do. Think of it as the bedrock for your journey in the boardroom.

K1. Corporate Governance

The main purpose of a board is governance. Key aspects to understand are corporate governance codes, the legal and regulatory basis of organisations, a director’s role and responsibilities, risk governance, board structures and decision-making.

K2. Leadership and stakeholder relations

The board leads the organisation and sets the tone from the top. It is also a key agent of stakeholder engagement whether that is government, media, unions, regulators, auditors, etc. ??

K3. Strategy

The long-term strategy of the company is set by the board and executive team. It’s important for a NED to understand the more common tools of strategic analysis and implementation. If you have not worked as a CEO/CFO/COO you may not have had any exposure to strategy development.

K4. Finance

Understanding and critically scrutinising the financials of a corporation are a key aspect of board work. Whatever your professional background, You have to be conversant with basic financial accounting standards and practices.

Skills

These skills are key to being an effective NED. Many of them may not have been learned during your executive career and taking the time to develop them will allow you to contribute thoughtfully to board discussions and provide appropriate guidance to the executive team.

S1. Strategic Thinking

Aligned with the strategy knowledge from K3 is the ability to horizon-scan and think strategically; to assess long-term opportunities and risks, ensuring that the board’s direction aligns with the company's broader goals. Many executives struggle to shift out of their operational/management mode and into this mode.

S2. Analysis and use of information

Board packs can be hundreds of pages long. In addition, a NED needs to be able to assimilate large amount of external information and develop sound judgement to guide the company.

S3. Decision-making

As a NED you have to be skilled at making informed decisions that balance the interests of diverse stakeholders while maintaining objectivity and independence.

S4. Communication

Clear and effective communication is essential for NEDs to influence board discussions, articulate viewpoints, and foster collaboration among stakeholders.

S5. Leadership

‘The Fish Rots from the Head’. The Board sets the tone for governance and ethical standards. Leadership in this context is about fostering collaboration, asking the right questions, and supporting the executive team in achieving strategic objectives.

S6. Influencing

A NED ‘has influence but no power’. You do not make executive decisions and you do not hire and fire people in the firm (besides the CEO, CFO and maybe COO). But you still need to be able to make your voice heard and have impact on the firm.

Mindset

Having the right mindset as a NED is key when it comes to navigating complex board dynamics. These traits help build trust with stakeholders and allow you to have a bigger impact.

M1. Ethical

NEDs must demonstrate integrity, transparency, and accountability in their work. The Ethical mindset allows NEDs to lead by example and make sure their decisions align with the organisation’s values and relevant legal and regulatory requirements.

M2. Professional

A professional mindset emphasises maintaining high standards of behaviour, reliability, and competence in fulfilling board responsibilities. It involves adhering to best practices, maintaining discretion, and handling sensitive matters with care and diligence.

M3. Performance-oriented

This mindset is rooted in the UK Corporate Governance Code which states that the board’s role is ‘to promote the long-term sustainable success of the company, generating value for shareholders and contributing to wider society’.

M4. Independent

An independent mindset ?means NEDs remain objective and impartial, free from undue influence, and focused solely on the organization’s best interests. It also means building a board culture in which NEDs can challenge the status quo without fear.?

M5. Aware of Self and Others

Self-awareness and social awareness are essential for a NED to understand their own strengths, weaknesses, and biases, as well as the dynamics within the boardroom. Most corporate boards only meet quarterly hence a high EQ is necessary to develop effective working relationships.

The IoD Director Competency Framework is here to help us all become better stewards of the organizations we serve. It’s more than just a list of skills—it’s a guide to continuous improvement, helping us stay accountable and make a real impact through good governance.

If you’d like some tips on how to engage with the IoD, its programs and the Director Competency Framework, please DM me and I’d be happy to help.

The Director Competency Framework

https://www.iod.com/professional-development/director-competency-framework/

----------

Ashwin Tirodkar is a Non-Executive Director, Qualified Risk Director?, and Chief Operating Officer with over a decade of board-level experience across industries such as banking, not-for-profits, and fund management. He combines his expertise in governance, risk management, and operational strategy to drive business transformation and innovation. Ashwin is also a passionate mentor, advising startups and social impact organizations on strategy, corporate governance, and growth. His approach to leadership focuses on building strong teams, fostering collaboration, and delivering long-term, sustainable results.