THE EVOLVING ROLE OF THE INED JOHN HARTY. Harty International Executive Search John Harty A look...

THE EVOLVING ROLE

OF THE INEDJOHN HARTY

Harty International Executive Search

John Harty

• A look back to 2008• Where are we now today• What does the future look like

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Limerick

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Dublin

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Harty International Today

Harty International

• Dublin• London

Global Locations

• Germany• China• South Africa• USA

Each office focuses its business on NED appointments

16 locations globally

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Pre 2009

• Senior management• Executive Roles• Occasional INED posts

2009 - 2015

• 50% INED• 50% CXO• 90% Financial Services• 10% Indigenous PLC Entities

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2009 - 2011

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The INED was born!

• NED no longer the NED• NED was now the INED

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Technical Specialist on Financial Services Boards

• Audit Chair• Risk Chair• Technical Specialism – Actuarial or Product Specialist

in Insurance sector

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2012 - 2015

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Diversity Survey by…

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Most directors want more diversity on corporate boards

THE majority of company directors in Ireland feel there are imbalances regarding diversity, expertise and age of those on corporate boards

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Most directors want more diversity on corporate boards

The study also found that 82% of respondents feel there is a disparity between men and women at the board room table

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GENDER QUOTAS:

• 43% of Irish directors are in favour of the introduction of gender quotas at the boardroom table

• 36% feel it would have a negative impact

• 21% were undecided

Most directors want more diversity on corporate boards

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2012 – to date

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Choosing the board You would like sit on….

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Please list in order of importance each of the following factors when considering a board position

Please list in order of importance, where one is the most important and 5 is the least, each of the following factors when considering a board position:

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Research Findings

• Since 2008 Corporate Governance has developed and moved centre stage

• The calibre of INED has increased significantly

• The role of the specialist INED is clearly defined

• Since 2012 we have seen a significant move towards balance at the board room table

• We have seen increased and proactive steps towards diversity

• Increased awareness re Technology, Digital, Customer

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Questions Asked in Board Room today:

• Who is the Digital INED at the board?

• Who is the Technology INED ?

• Who understands the customer clearly?

• Who on the INED team can provide an alternate sector insight on customer

…. Who can challenge the status quo !

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The Future

• The Technology expert at the board table

• Diversity a constant theme: Sectorial; Specialist; Generational; Digital; not just Gender !

• Induction programmes & ongoing training for INEDs and Chairmen

• Changing Regulatory Environment a constant theme – multijurisdictional

• Enhanced Regulation which is more business enabling

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What else have we learned…

• Adaptability of the INED • ability to adapt to change in an ever changing global & consumer

market driven environment

• Boardroom Evaluation & Assessment • regular re-evaluation & monitoring of the board room team and the

balance of the NED and INED team

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The Regulator and the board

• In the past much of the onus would have fallen on the CEO, today there is a big responsibility placed with the Chairman to develop relationships with the regulator, which are based on a strong trust.

• With significantly enhanced regulation – the Chairman must be able to demonstrate that INEDS and Committee Chairs aren’t just doing a “rubber stamping” process, but are actively engaged in their roles.

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Managing the Board – The Chairman

Attracting the best INEDs – INEDs are exposed to far greater risk today. To attract the best, remuneration must reflect this level of risk, but the Chairman must also create an attractive environment at the board room.

Focus on Strategy – While regulatory requirements must be adhered to, it is imperative that the Chairman establishes a structure that allows the board to focus on strategy.

Committees - It was agreed unanimously that committees should reflect the composition of the main board, in terms of viewpoints, background, experience etc. and that the Chairman should delegate to these committees via the relevant chairs.

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White Paper Series…The Future of Financial Services Boards

• Effective Alignment of Non Executive Directors• The Role of the Chairman

Both whitepapers available at the rear of the room.

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Thank you

• John Harty• Director – Harty International