Having a strong board is a key foundation for any business and especially for those raising funding. But what should you look for to get the most out of your board? We asked our Senior Partner, Stuart Hendry for his thoughts on the subject.

I often get asked what a good board of directors for a private company that is fundraising should look like, so I have included some suggestions and thoughts below:

• Have an independent non-executive director (NXD) chair who has experience, who can command wide respect and who is not also your investor director;
• Have a further NXD appointed where possible;
• Ensure your directors are different and diverse and able to challenge each other in a positive way - there must be candor as well as trust and respect;
• Three executive directors and two NXD's is often a ‘good looking’ board;
• A board of more than five can find it very hard to function well. To keep director numbers down consider having separate operational meetings of the executives and senior managers with not all of them being on the board of directors. Multiple investors must also avoid all appointing their own NXD investor directors to the board - having more than two investor directors on a board can be unnecessary and unhealthy;

• Consider appointing a separate Advisory Board from a wide spectrum of experts to help test out your strategy - tech companies do this a lot with a ‘Scientific Advisory Board’. Many boards will also have a separate Remuneration Committee, controlled by the NXD's, to manage salary and option awards;
• Make sure your board is reviewed every two to three years - making changes can be healthy to ensure everyone is contributing and adding value and playing to their strengths. As a business changes the required skill set can change and often an early stage CEO might be a better late stage COO, CCO or CTO and there is nothing wrong with that;
• Don’t knock people down if they don’t share your point of view - it is healthy to challenge leadership and a real skill of a leader is to listen and not always talk. Other views are valid as long as criticism is constructive;
• Ensure there is a good strategic format to your board meetings and separate strategy from general operational matters. All directors should receive a board pack in advance with an agenda so that the board discussion can focus on ‘value add’ points. Any director who turns up unprepared and not having studied all of the board papers and up to date accounts in advance should not be on your board; and
• Make sure your fellow directors are smarter than you and with appropriate experience (including the ability to read your accounts)! Never settle for anything less than top talent to help drive your business and strategy forward.

If you are looking for some support on corporate governance matters or an independent view on your board composition or boardroom practices, then feel free to get in touch.