A board should be structured so there is a balance between executive and non-executive members, there is a majority of non-executive directors, and there is at a minimum a critical mass (at least two for a smaller board) of independent directors.

Australian law does not stipulate ratios of executive to non-executive directors. However, the Corporate Governance Council Principles and Recommendations state that a majority of the board, including the chair, should be independent directors.

Executive directors usually carry out executive functions in the management and administration of the company. Non-executive directors are usually independent of corporate management. The role of independent, non-executive directors is encouraged on a board.

Independent directors are those who have not been employed as an executive by the company, have not recently been a partner, director or senior employee of a business providing services to the company, are not substantial security holders in the company, and do not have a material business relationship with the company or a related company.

John leads a global team at Integrity Governance that is focused on making boards more effective. A boardroom expert working with multinationals, SMEs, trade associations and not-for-profits, he provides practical, impartial advice to directors, business owners, executives and CEOs, to help improve board performance. He has 30 years of experience at director level in the corporate world, having worked at blue chip businesses including: Mars, Schroders and Goldman Sachs.

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