Every board needs to consider the appointment of new directors and it is important to have a board succession plan to help with the recruitment of the new directors. Here are some things to consider in developing a succession plan and undertaking a director search.

Step 1: Know the requirements of your governing documents and legislation

What does your association’s constitution say about directors’ appointments? Does it specify things such as: term limits; a specific list of skills; geographical representation (eg, a director from each State/Territory) or other representative requirements; and/or minimum and maximum board size. Also must a director be a member of the association? This information will set some of the parameters for the succession plan.

You should also consider any requirements in associations or companies legislation. For example a company limited by guarantee must have at least 3 directors on the board, or an incorporated association in NSW must have three committee members

Step 2: Identify the skills needed on the board

It is important for the board collectively to have the range of skills required to manage the association. This can be established through the board undertaking the following exercise:

A. Identify the skills that the board would like to see sitting around the table. A useful aid is to refer to the current strategic plan – eg if the association has a focus on fundraising, you might decide that a director with an understanding of fundraising or relevant networks is important. You might end up with a list of eight or more skills required.

B. Once you know what you want, you need to look at what you have already. Have the current directors assess their skills and knowledge against that list. This will highlight any gaps.

But my constitution requires us to have a representative board!! If this is the case, this is still a useful step. Even within a representative board, you may be able to find people to be directors with the desired skills.

Note that the skills required may change over time and it is worthwhile undertaking this exercise every few years.

Step 3: Prepare a director position description

Prepare a position description for the role of director and include information about expected time requirements, travel, remuneration arrangements (if any) and the specific skills sought. Also include background information on the association.

Step 4: Finding a director

There are various options for sourcing new directors:

- Director networks; where directors tap into their network for likely candidates.

- Advertising; there are places to advertise for directors for free. When using this type of service, it is important to be very specific about the types of skills required. Otherwise you may be overwhelmed with generic applications.

Your plan should outline the proposed process for recruitment of new directors.

Step 5: Put the succession plan in writing

Capture the work you did in the previous steps as the succession plan and have it approved by the board and review it every few years. That way, you have already done the critical thinking on the type of director and how you will go about the recruitment process when board vacancies arise.

Corporate Companion is a boutique provider of corporate governance advice, services and training specialising in the not-for-profit and charitable sector. Corporate Companion can provide practical advice for a value-for-money price to your association.

Contact Charlie Robinson on 0400 404 929 or charlie.robinson@corporatecompanion.com.au for more information