Old boy network going strong in the boardroom

2004

Organisations need to improve the way that they recruit non-executive directors according to new research that points a spotlight on the lack of diversity at the top.

According to the research for the Cranfield School of Management's / Daily Telegraph Recruitment Confidence Index (RCI), the old boy network remains the key to landing a non-executive directorship.

The research, sponsored by executive search firm Odgers Ray & Berndtson, found that one in three firms use nominations from the board to find non-executive directors (NEDs). In addition more than four out of ten use a mix of informal networking and what they call 'the personal approach'.

Last year, a MORI poll found that nearly half the non-executive directors of UK publicly-listed companies were appointed through personal contact with an existing board member.

According to Virginia Bottomley, who heads up the Board Practice at Odgers Ray & Berndtson, it remains all too common for people to recruit in their own image.

"The challenge is to look through the window rather than at the mirror,” she said.

"Access to the broadest range of candidates using a variety of recruitment techniques is the best way to ensure diversity amongst NEDs. Working the network is simply not enough.

"In many ways, the public sector has led the requirement for more due diligence and transparency in the recruitment process. For corporations to succeed in a fiercely competitive world, it is essential that a choice of talented individuals with integrity and differing skills and perspectives is available."

Andrew Kakabadse, Professor of international management and development at Cranfield School of Management, believes that networks are fine as long as they are being used in the right way.

"People are using the network, but that does not mean they are misusing it. They are using it to get the best person, rather than to secure a job for their mates."

He continued: "The pool of top talent is getting tighter and recruiting at this level is very risky. Employers cannot afford to get it wrong which means they have to be sure that the directors they recruit will fit the organisation."

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