The Right Direction

17 March 2011

What are the essential qualities of an able company director? Financial astuteness, the ability to think and act strategically, an in-depth knowledge of corporate affairs and their legal responsibilities, are all essential. How though can the competence and professionalism of a particular director be assessed and relied upon by the market? Lawyers, accountants and doctors carry practising certificates obtained after rigorous examination, airline pilots are submitted to tests every six months and yet strangely company directors undergo no specific training and are required to have no specific qualification to discharge their roles. Roles, which if performed improperly can have very serious, adverse consequences for consumers and the market.

The credit crisis revealed startling inadequacies in the quality of senior management of financial institutions across the world. Consequently the role of directors and strategic leaders within all sectors and sizes of organisation has never before been under as much scrutiny as it is today. With an ever-increasing focus on the professionalism, competence and integrity of directors by governments, shareholders, investors and the media, directors are faced with a simple choice: improve and raise standards, or face the consequences.

For many years the conventional wisdom has been that directors do not need or require training on how to discharge their roles and responsibilities. In fact promotion to a board has commonly served to verify an individual’s suitability as a director. The market now recognises that there are many incompetent directors. A director’s knowledge, experience or technical expertise does not necessarily qualify them to discharge their professional responsibilities as directors. Being a director is a profession in and of itself and directors require to be educated in how to perform competently in the role. Recognising this, the Institute of Directors launched Chartered Director, the professional qualification for directors, in 1999. It is now established as the benchmark qualification for directors whether in private, public or third sectors. The qualification is offered in Jersey exclusively through the Jersey International Business School.

Chartered Director is supported by a large number of major and influential organisations. Institutional shareholders and their advisors, banks, international executive search agencies, professional institutes, business think tanks and leadership centres in the public sector all recommend Chartered Director to directors and their boards. Encouragingly the qualification has been recognised as a Table 4 qualification by the Jersey Financial Services Commission since 2009.

Chartered directorship is of particular relevance to trust company businesses, the directors of which are often directors of both the trust companies and of corporate director vehicles through which they also manage and control hundreds of client companies. There are obvious commercial advantages to trust companies that offer ‘qualified’ company director services.

Despite the obvious benefits of pursuing the qualification very few directors in Jersey have obtained it. Indeed there are now more Chartered Directors in Guernsey than Jersey. What are the reasons for this? Complacency may be one. Businesses have had it so good in Jersey in the past twenty years that finding the motivation to invest in qualifying directors has been more difficult than it is now. However, with data showing that Jersey’s economy has contracted whilst Guernsey’s has grown, Jersey directors need to raise their game to compete successfully with other Channel Islands as well as even more robust competition from Singapore and Hong Kong. Fear of failing the examination also militates against senior executives submitting themselves to the course and assessment process. Whilst it is true that the assessment is rigorous (as it should be) any competent director or aspiring director will, with application, pass.

The next Chartered Director qualification programme commences in September 2011. In order to preserve as rich a learning experience as possible the maximum number of delegates is strictly limited to twenty. Registrations are taken on a first come first served basis. The course is taught by a faculty of trainers provided by the IoD in London many of whom are past or present directors of FTSE 250 companies. Past students report that the quality of the teaching is excellent and we have observed that students appear to obtain huge benefit from the collegiality of the student group. New and valuable relationships are forged in the heat of advancement towards becoming a qualified company director.

To discuss any aspect of the IoD Diploma please contact Natalie Dimond, Director of Operations at the Jersey International Business School on 816333.

ENDS

Contact
Sara Clews, Head of Marketing & Events
+44 (0)1534 816332 or 07797 828741

FOR PUBLICATION
Business Review in the Jersey Evening Post
Wednesday 16 March 2011