Time to overhaul director selection

Independent director selection is usually done on a who you know basis. With changes coming in the UK, CP 86 etc selection procedures could do more to find those with experience but without contacts to fill director positions. But what could realistically be done to help those with the right skills and experience – but without connections – become independent directors?

Research that The NED conducted last year showed that the selection process is generally pretty random. Good and experienced people are often selected for boards but they tend to move in the same circles and have similar backgrounds. This is particularly the case for directors of funds domiciled in Guernsey, Jersey, Ireland and Luxembourg. (In Ireland the problem is made worse by the two director residency requirement.)

To read more of this story, see the April issue of The NED.