By Pascale Gara
Talented retail executives are being targeted by the boards of financial services institutions looking to adopt new technologies to get closer to their customers.
Many banks, building societies and other FS providers remain some way behind the retail sector in rolling out customer engagement and digital transformation strategies, and boards are under pressure to deliver as they respond to a radically transformed market place.
Non-executive directors with significant retail and digital experience are therefore in demand given the huge value they can bring to an FS institution’s board.
Martin Newman, CEO and founder of global retail consultancy Practicology and a non-executive director of leading drinks distributor Conviviality Plc and the multichannel fashion retailer White Stuff, has more than 25 years of multichannel retailing experience with well-known brands including Ted Baker, Burberry, Harrods and Intersport.
He said: “I believe that experienced NEDs, as well as first time NEDs whose core experience is outside of financial services, can bring a lot to the sector in NED roles – particularly those from the retail space.
“After all, retail touches the consumer more frequently and is much faster paced than financial services. I also believe that retailers have been quicker to adopt digital and begin their transformation towards more customer centric organisations. They’ve also started to address other key questions such as ‘what’s the role of my store?’, or ‘how many stores do I need as more of my business moves online?’
“Financial services players face the same questions, particularly retail banks. Therefore, senior retail executives who have this experience will have a lot of value to add to FS organisations.
“The customers of financial service providers spend far more time in retail, and therefore those with deep knowledge of the retail space, what matters to customers, and how to truly put the customer first, would be able to leverage this experience and insight extremely well within FS.”
Retail executives without NED experience who would relish the challenge of a first non-executive directorship within FS have numerous considerations to make first, however.
A highly experienced FS executive with an impressive NED portfolio, speaking at a recent industry dinner, said among them was an acceptance that as an NED you have no executive power and can only influence, contribute and challenge constructively.
You should not underestimate the time and pressure demands on an NED when the business is in trouble, and should expect to exert double the time indicated in the role spec, he said.
And just being a successful senior executive carries no strong entry point in such a highly competitive market; there are only a couple of thousand NEDs in the FTSE 350. The hardest NED role to get is the first one, he advised, and it sets the standards on which you will be benchmarked, so don’t necessarily take the first one which may come your way.
Brian Brodie, CEO of Freedom Finance Group, had further advice for would-be non-executive directors. He told HW: “The best NEDs are constructively challenging and bring new thinking rather than old questions.
“It is too easy for lazy NEDs to roll out standard set of challenges to the executive which don’t really add any value. This leads to frustration. The best NEDs help to build the confidence of the Executive (if they merit that) and guide them to avoid mistakes and pitfalls.
“The worst NEDs try to be friends with the Executive and this just doesn’t work as there is a need for independence. NEDs are often there to prevent the destruction of value by the Executive. As such they are more governance and control-focused and tend to be more about oversight than working with the executive.”
HW Global Partner has a track record of working with a range of companies from FTSE 100 to PE backed organisations to provide Chair/NED candidates who can offer perspective and challenge, and specialises in FS and Consumer.
Pascale Gara is a Consultant in the Chair & NED Practice at HW. If you wish to discuss NED opportunities as either a client or candidate contact her at firstname.lastname@example.org or +44 (0) 781 258 2486 for a confidential chat.