First Time NEDs: Nervousness is Healthy

Elin Wrammerfors - Sweden 

Here’s why, and what to do about it. 

Geopolitical shocks, ESG pressure and cyber threats are complicating today’s risk landscape. Shareholder scrutiny and ESG reporting are increasing the visibility of board decisions. NED candidates are worried about personal liability. But the real risks for NEDs come from weak governance, passive boards, and groupthink.  

There is good news. As an independent board member, you don’t bear the burden alone. Nor are you judged on clairvoyance. What matters are proper oversight, independent judgment, and robust decisionmaking processes. How you reached a decision is almost more critical than the decision itself - following every step correctly, serving the company’s best interests. 

 

Amrop Leadership Lens Boards March 2

Check your motivation – because we will.

I like nerves in a candidate. They signal respect for a highly responsible mandate: you don’t ‘sit’ on a board, you work on one. I worry more about people who are overly relaxed. Even more, about misdirected motivation. A board position is about responsibility, not résumés. The primary driver is not prestige, compensation, or networking, but longterm value creation. With this in place, the NED workload will feel meaningful, not burdensome.  

How do we encourage candidates to step into the ring?  

The key is to reframe the NED role. Boards are collective bodies. Remember - accountability is shared. Our board evaluations reveal that the strongest distribute responsibility, welcome debate, and surface tough questions early. If you have integrity, and can challenge constructively, you have NED potential. 

NED nervousness is often caused by unknowns. To fill the gaps, due diligence is vital. Before accepting a role, and beyond media reports, perform some discreet investigations. For example:

  • Is this company strategically, financially, and ethically watertight? 
  • How mature is its governance: its board composition, dynamics, and processes? 
  • How could the firm’s ownership framework be shaping the board’s ability to work effectively? A listed corporate differs from an owner or founderled firm. 

Do digest the numbers. Annual reports help you understand the company’s financial stability. You don’t have to be a CFO. You do need the financial courage to engage with these questions in the boardroom.  

Fortunately, the answers are within reach. Your executive search consultant is a prime sparring partner. Such conversations with candidates are an integral part of Amrop’s NED hiring process.  

Trusted members of your entourage may also have insights – people who don’t work for the company, but know enough about it to (confidentially) inform you.  

The Chair shapes the board culture and has a finger on its pulse. You have the right and responsibility to ask tough questions - diplomatically. The tone and quality of that dialogue will not only give you critical intelligence, but a temperature check. How open can you be with this person? Do you trust their judgment? The conversation is a first step in building a pivotal relationship. Here are some avenues:

  1. Seek to understand the relationship between the board, CEO, and executive team. “Tell me how you work together. How would you describe the board’s level of trust in the executive team? Where do you feel they are strongest, and where are the pressure points?” Observe not only the content of the answer, but the form. Hesitation speaks volumes.
  2. Get a feel for the boardroom atmosphere: “Is there space for open, strategic discussion, or do you tend to stay close to the formal agenda?” “What would you say are the board’s strengths today? And where do you see room for improvement?”
  3. Finally, turn the lens on the company’s strategy. How the Chair frames it (and at what altitude) signals the board’s willingness and ability to guide, not control, the management team.

Discussions with the management team or CEO may also be possible in an open recruitment process. However, as these executives are bound by confidentiality, there will be a limit in what they can share.  

Ready for entry? 

In summary - nervousness marks awareness. If you have competence, integrity, and the willingness to prepare, an NED role is not a reckless endeavor; it’s a responsible one. We need more capable NEDs, not fewer. Coaching candidates so that they dare to leap with their eyes wide open. 

Are you still overwhelmed by the prospect of a board role? Is risk your only deterrent? Then an NED mandate may not be for you. Calculated risk is part of the job. Governance isn’t about avoiding risk; it’s about overseeing risk - responsibly. 

Contact Elin Wrammerfors