BE A BETTER DIRECTOR: Australian business leaders share their insights on the skills modern company directors need

AICD‘Be a Better Director’ is brought to you by the Australian Institute of Company Directors, an internationally-recognised organisation dedicated to directors. With over 35,000 members, AICD’s activities include education, development programs, publications on directors’ and governance issues, and promoting matters of interest to directors. Members range from directors of ASX-listed companies to not-for-profit organisations, family and private companies and entrepreneurial ventures.
Amazon’s Jeff Bezos famously understands the intricate details of his business. Photo: Mario Tama / Getty Images.

A skilled company director can have a significant positive influence on the performance of a company despite the non-operational nature of being a board member.

At first glance, the distance from the heavy lifting of daily workloads makes it look unlikely directors can have influence other than to set policy and write a vision statement.

However, in a legal sense, the operations of companies are run by directors on behalf of shareholders.

Staff are hired, headed by a chief executive officer, to do the day-to-day running, but it is the directors themselves who are ultimately responsible, and can be held accountable, for the assets of the company.

The responsibility can’t be wholly delegated down the chain of command. The Corporations Act expects directors to really know what the company is doing. That also means taking care with handling other people’s money (the shareholders), making sure the business can pay its debts on time, and keeping proper financial records.

Company directors can drive performance through establishing a healthy culture and to do that they need to build a deep understanding of the people, assets and customers of the business.

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