How do effective directors ensure they perform good due diligence on a new director joining the board and what due diligence do they do for their own new appointments?

Based on a framework of global corporate governance best practice, which can be used in all organisations anywhere in the world, this chapter of Questions To Ask (QTA) in the boardroom gives a high-level but succinct introduction to due diligence of a new appointment and of a new director joining the board.

All directors should ensure that an appropriate amount of due diligence is performed on any new director joining the board. They should also ensure they themselves ask the right questions for any new appointment they consider taking.

The chapter considers what should be asked of a new director in advance of joining the board and what questions directors should ask before accepting a new appointment.

For a director looking to accept an offer to join a board, this includes asking questions about finances, insurance, legal and regulatory issues, the reputation of the company, company and board culture, governance, risk management, stakeholder engagement and any public statements/press of note. It is important to also look into the individual directors on the board and the overall board composition.

When looking to add a new board member to the board, it is worth asking questions about any connections to the board members or the organisation to ensure transparency alongside looking at capacity for the engagement, skills, executive experience, emotional intelligence, legal and/or regulative issues and interest in the sector/industry.

The chapter’s introduction leads into outlining the key Questions To Ask in the boardroom, giving the reader further insight into how to initiate discussions about the practical details requiring the attention of the board.