In today’s digital world many organisations aren't benefiting from the opportunities and threats presented by advances in technology. While over 90% of executives rate digital as mission critical, when it comes to understanding the competitive advantages of data and how this impacts business models, there is a lack of digital presence from director level up. The result?
Many executive teams are now scrambling for a Digital NED to avoid being left behind. Myself and Nadine Thomson were delighted to host this event for aspiring Non-Executive Directors in the digital space, where the panel discussed how they found their way to the boardroom, and offer advice for those wishing to do the same. A massive thank you to Sian Jones, Ramona Liberoff, Bindi Karia and Jonathan McKay for your insight and honesty.
Be sure you're ready
For our panellists, understanding the responsibility which comes from a Non-Executive position is key. NEDs are expected to wear many "hats" and play a direct role in shaping business strategy. But this doesn't come without serious accountability.
“You have a fiscal and legal responsibility to the company, but you'll only be in one or two days a quarter." Pointed out Sian. "So you'll be making difficult decisions from the information which the executive team presents to you."
Candidates are therefore unlikely to thrive in the role if they are motivated purely by gaining experience for themselves – they need to be confident they are adding unique value to the company.
“Being a NED isn't a selfish responsibility. You can't go into it thinking ‘what am I getting out of this.'”
A pivotal role
Understanding the importance of your role is particularly key in a boardroom still mainly populated by individuals without a digital background. A Digital NED is often expected to be the most informed in the room about a myriad of issues – from tech-led competitor threats to cybersecurity.
“When you’re the only digital Non-Executive in a room, you better be able to back up your experience - because every decision has a technical consequence, and you will be the authority on this.” Sian emphasised.
One of the biggest difficulties is understanding the possible nuances of the role, with Ramona suggesting that in fact there were different "types" of digital Non-Exec. Some are likely to have a more technical background, while others need more focus on what digital had done to the broader landscape, industry, power structures and information systems. “The challenge is which one does the organisation need, and do they know that. Non-Exec, know thyself.”
Failures and trouble-makers
However, if you're sure you can offer that value and a wealth of experience, then a NED position can be incredibly rewarding, as Bindi observed: ”A NED is like the third eye of the business, with experiences you can share insight that [others] won't have seen.”And what are the best things you can bring to the role? Your failures. “Failures are what tune your risk radar as Non-Executive.” cited Sian.
Ramona agreed, “they bring you the insight you need for board leadership.”What's more, there isn't just a single board which is open to applications. Many companies are now forming Digital Advisory Boards – which play a different role entirely.
Sitting on a Digital Advisory Board, you don't have a legal responsibility to the business, and they are not under obligation to accept your advice. Bindi shared that she’d been asked by one client to be a professional ‘trouble-maker’ while Ramona described this role as challenging the corporate board to think further in the future, and “think about the future in a way which is not just about growth”.
Whereas some used the advisor role as a stepping stone to NED placements, others stay as advisors forever. ”It can be equally as rewarding - with less of the accountability.” Bindi and Ramona agreed.
Know your worth
Accenture's study ‘Tech Experience: Women's Stepping Stone to the Corporate Boardroom?’ highlights the interesting phenomenon that 17% of women who are in the boardroom have a professional tech backgrounds, compared to 9% of men. This suggests that there is a particular opportunity for women to enter the boardroom in a digital capacity. "A tech background is a differentiator for today's Non-Executive. Digital leaders, particularly female digital leaders, have a unique opportunity to enter the boardroom and bring real value", says Nadine.
However, they should be confident in their worth when they're asked to take these roles, as Bindi pointed out.
”As women, we don’t ask for what we’re worth. Work out the value you are going to add. Ask for compensation which reflects this.” What other advice did she have to offer for aspiring NEDs? “Be fearless and accept you’re going to get rejected. Also, remember that [if you're on start-up board], a lot of it is based on the trust you have with the founder – you're going to be part of the family for four to five years.”
What do boards really look for in a NED?
Our established panel of Non-Executive Directors gave us their insight on what boards look for when employing a digital NED, including looking for an expert in a different domain of tech, or someone who has a different geographical perspective.
They added that, for aspiring NEDs in the corporate space, it's wise to engage with businesses through the investment house. Jonathan Mckay, an established chair of several companies including La Fosse Associates, had a key perspective to share: “Often, the stimulus to get a digital NED onto the board comes from the PE or VC company. So, in terms of entry point, I would encourage you to make those contacts, and come with a specific set of expertise and domain experience."
Taking on a Digital NED role is an opportunity to add a really significant amount of value to a business, bringing a diversity of experience and a willingness to think longer term. What's more, there's never been a better time for digital professionals to explore these opportunities.
Thank you to our panellists for an incredible event – the feedback below highlights how valuable this was. "Outstanding event, insight not found in books or blogs - Priceless." "This was a masterclass in executive leadership- really worthwhile & fabulous speakers."
"Very insightful + informative event which has prompted me to follow the NED route."
If you're interested in learning more about the Digital NED role and what steps you can take to get there, or want to register for next seasons "The Rise of the Digital NED" event, please don't hesitate to get in touch at firstname.lastname@example.org.