Recruiting company directors

When appointing a director for your business, you might be tempted to appoint someone from among your network of industry contacts, eg from businesses that you partner or trade with.

However, it is very important that you choose the right talent for your business, rather than just someone you like. Therefore, the most effective method of appointing directors is to follow the traditional recruitment process by:

• putting together a job description and job specification
• advertising the position through the normal recruitment channels, eg the financial or trade press
• shortlisting applicants
• selecting the appropriate candidate via assessment, eg interviews, tests

See recruiting staff and how to advertise a job.

Using an employment agency to find directors

You could consider using a 'headhunter' - an employment agency that specialises in helping businesses recruit company directors.

Headhunters offer services such as:

• designing job specifications
• running assessment centres for candidates
• shortlisting candidates for interviews
• conducting first interviews
• coaching on running effective boards

Be aware that headhunters' fees can make the recruitment process expensive.

Shortlisting and testing candidates

If you decide to recruit without the help of an employment agency, you should certainly interview shortlisted candidates. However, you might also consider testing them using, for example, an assessment centre.

For advice on the recruitment and selection process, see advertising a job and interviewing candidates.

Make sure you select a company director on the basis of merit, and not because of personal relationships or share ownership in the company. Check their references carefully. See appointing and paying company directors for information on involving all directors in the decision-making process.

It's a good idea to keep your board of directors as small as possible, especially in the early stages of your business' growth - the smaller your board, the more effective it is likely to be.

However, if you are preparing to float your company on the Stock Exchange, you may need to recruit additional company directors as flotations can take up a lot of management time.