The importance of NEDs by Ann Elliott

Will Beckett, the founder of Hawksmoor, was a mentor on the Plan B mentoring programme this week alongside Jo Fleet, Bryan Griffiths and Juliett Campbell. Plan B mentoring hosts regular speed mentoring sessions to help talented women to be the best they can be and to progress in hospitality – hopefully to board level. Our mentors at an earlier session this month included Jonathan Arana Morton, Penny Manuel, Maurice Abboudi and Simon Kaye. I have to say, our mentees have the most fantastic mentors on this programme. Sorry, I digress.

 Will was asked why he chose to be a Plan B mentor and he said he was really enjoying being the chairman of Rockfish. It was great to be able to help and advise a business, objectively, without having day-to-day executive responsibility. In some ways that's a bit like mentoring. Being able to question and challenge constructively and positively with only the best possible interests of the mentee at heart.

 It made me think about all the many businesses out there that could help by having people such as Will involved as non-executive directors (NEDs) on their boards – particularly small and medium-sized enterprises (SMEs). There are so many incredibly talented people in this sector who would willingly provide their support and expertise in order to help a business thrive and for not a lot of money, considering the benefits.

 I asked Neil Sebba, managing director at Tossed, for his view. He said: “I think selecting the right non-executive directors is one of the most important decisions owner-managers and entrepreneurs can make. It requires introspection and a realistic assessment of your own and your executive board's strengths and weaknesses, and an assessment of the characters that you can work with well, but that will challenge you. Get it right, and they will help you be the best directors you can be, running the best version of your business.”

 And Matt Kearsey, of Hall & Woodhouse concurred. He said: “NEDs provide an important, alternative voice in the conversation. Our executive team spends a lot of time together, which is great for co-operation and collaboration, but there is also the risk of group think and subjectivity bias. The best decisions come from encouraging a diverse range of views and our NEDs provide us with objective, independent, and often challenging thinking. Their experience, expertise and contacts help us create better strategic direction; their support means the executive team doesn't feel isolated or lacking in help, and their independence performs the important role of effective oversight of the executive team. I can't imagine our board without them.”

 Julian Ross, founder of Wireless Social, has several NEDs and said: “I am a huge believer in having multiple NED's. I've been questioned about it many times. I'd have ten, if people wouldn't frown at me about it, and look at me as if I've gone bonkers!” He said the reasons, in no particular order, were:

• Sounding board and a mentor – it can be lonely in the managing director’s role

• Connections – my business wouldn’t be here without them

• Keeping focus. Being asked difficult/challenging questions

• A calming influence, particularly in a crisis

• Specific expertise to plug a gap – marketing, finance

• Sector expertise

 Matt Snell, managing director at Gusto, told me: “The best NED's don’t try to be executives; they won’t try and make decisions for the executive directors or push them into a specific route because that's their preference. Instead, they ask difficult questions, challenge executive assumptions, look for unintended consequences and most importantly act as a conscience around decision making as a whole. We know they have our best interests at heart and will provide constructive feedback in a positive way that helps us be more successful. It's a really important role for us and one we take incredibly seriously.”

 If you run a business, particularly an SME and would like the help of a NED, then the best way to find the right one for you, undoubtedly, is to let your contacts know and to ask for recommendations. They will know you and be able to suggest best-fit candidates. Seems obvious but write a spec of what sort of person you want, and what you want them to do, and then interview against that. Chemistry is critical. The comments from the managing directors above might prompt some thinking.

 If you are someone looking for a NED role to help businesses succeed, then the same sort of thinking applies. Know what you want and the sort of company you want to join/not join. Let your contacts know and potentially contact the companies you like, directly. As the saying goes “What would you do if you weren't afraid?”

It is a joy being a NED. It is without doubt, the best part of my career to date.

Ann Elliott is a hospitality strategist, connector and adviser