ABSTRACT
There is a certain approach to corporate governance which sees the role of the non-executive directors (NEDs) as essentially that of stopping the executives from getting away with things that they should not get away with: for example excessive pay, contracts where there is a conflict of interest and so forth. Although there is an element of truth in this approach, the 'policeman' role sits awkwardly with the other aspects of the roles of the NED: working with their colleagues on the Board as a team to help the business generate value for the shareholders. When the NEDs act as policemen they are, at least in principle, acting in the interests of the shareholders and against the interests of at least one of their close colleagues. This is not an easy situation, and often they are acting in response to investor pressure.
