Business Meeting

Director Competency Framework

The IDAPNG Director Competency Framework sets out the key competencies required of a director from both a governance and soft skills perspective. This serves as a good guide when considering what to look for in a director during both application and interview process.

DIRECTOR COMPETENCY FRAMEWORK

This framework identifies the knowledge, skills and experience you will be required to evidence for the Chartered Director Evaluation.

COMPETENT
PERFORMANCE

The competency profile for Directors is made up of the values, knowledge, skills and experience that a director draws on when fulfilling their roles and responsibilities as part of a board, performing their duties as direction giver and applying their knowledge of the legislative, business and ethical environment when making decisions. The effective combination of knowledge, skills and experience underpinned by values is what defines the behaviour of a director as competent.

 

A qualifying Chartered Director will have demonstrated the following competencies:

  • Contribute to and function as board member within the appropriate governance structures and cognisant of position of trust

  • Lead the company effectively and ethically in the long-term interest of all its stakeholders

  • Act as director within the confines of the law

  • Contribute meaningfully and effectively to strategy - setting and implementation thereof

  • Serve as an effective audit committee member and/ or to relate the functions of the board to that of the audit committee

  • Act in a manner that demonstrates understanding of the responsibilities of various assurance providers and how these are leveraged to contribute to the working of the board and its accountability to stakeholders

  • Interrogate financial statements and to conclude on financial performance of company

  • Oversee a variety of management activities at board level, including risk management policy formation and oversight of implementation thereof, IT policy formation and oversight of implementation thereof, compliance management policy formation and oversight of implementation thereof, stakeholder policy formation and oversight of implementation thereof, integrated reporting, the management of ethics within the company and, remuneration policy and its implementation

  • Respond to business challenges in a creative and constructive manner

  • Gather and analyse information in decision-making by applying logical thinking

  • Act in a manner that demonstrates self-knowledge and self-awareness

  • Manage self in a manner that contributes to the activities of the board

  • Adapt to environmental needs

  • Interact with fellow board members and management in a manner that is beneficial to the company

KNOWLEDGE AND SKILL

In order for a director to perform his or her role in a professional manner, he or she will need to possess the appropriate set of functional, personal and social competencies required of a director – in short, professional skills. The knowledge and skills underpinning these competencies are described in the table below:

Contribute to and function as a board member within the appropriate governance structures and cognisant of position of trust

Corporate governance

Corporate governance development and evolution; Theories; Purpose and benefits; Application; Linkage with law; Independence and conflicts; Governance structures (Board, Board Committees, Company Secretary, Shareholders, Group Companies) and delegation frameworks; Responsible investing

Lead the company effectively and ethically in the long-term interest of all its stakeholders

Ethical governance

Leadership and corporate citizenship; Ethical values underpinning corporate governance (Responsibility, Accountability, Fairness, Transparency); Moral duties (Conscience, Commitment, Inclusivity of Stakeholders, Courage, Competence); Sustainability; Stakeholder inclusivity

Act as director within the confines of the law

Directors' legal duties

Common law, legislation, including Companies Act, competition law and other related regulations and codes

Contribute meaningfully and effectively to strategy-setting and implementation thereof

Strategy

Business models and value creation; Strategic risks and opportunities; Considerations of wider environment including stakeholder expectations; Impact of strategy on society and natural environment

Oversee the management of ethics within the company

Governance of ethics management

Ethics, risk and opportunity profile; Policies; Risk management; Monitoring; Reward; Disclosure

Oversee remuneration policy and its implementation

Remuneration oversight

Role of remuneration committees; Components of remuneration; Linkage with performance; Ethical dimension of remuneration; Policy; Measurement; Reporting; Shareholders' say on pay

Serve as an effective audit committee member and/or to relate the functions of the board to that of the audit committee

Audit committees' duties and functioning

Legal requirements for audit committees, skills, role in relation to other board committees - especially risk, sustainability and social and ethics committees; Oversight of external audit, internal audit and finance function; Disclosure

Act in a manner that demonstrates understanding of the responsibilities of various assurance providers and how these are leveraged to contribute to the working of the board and its accountability to stakeholders

Combined assurance model

External audit, management reporting; Internal audit and internal controls; Risk management framework

Interrogate financial statements and to conclude on financial performance of company

Financial literacy

Interpretation and sound working knowledge of financial requirements and information

Risk governance

Oversee risk management policy formation and oversight of implementation thereof

System and process of risk management, risk tolerance and appetite; Role of risk committee; Implementation and monitoring of risk management plan; Risk assessments; Risk responses; Assurance; and, Disclosure

Oversee IT policy formation and oversight of implementation thereof

IT governance

IT charters and policies; IT governance framework; IT risks - investment and expenditure, protection of information assets; Assurance; Disclosure

Oversee compliance management policy formation and oversight of implementation thereof

Compliance governance

Compliance universe; Compliance framework and process; Integration into risk process

Oversee stakeholder policy formation and oversight of implementation thereof

Stakeholder relations' governance

Reputational risk; Identification of stakeholders; Stakeholder inclusivity; Engagement with stakeholders; Alternate Dispute Resolution (ADR)

Integrated reporting

Oversee integrated reporting

Nature of integrated reporting; Frameworks and principles; Assurance

Respond to business challenges in a creative and constructive manner

Business judgment

Anticipation of risks; Dealing with risks; Recognition of business opportunity; Anticipating competitor action; Setting priorities and resource support

Analytical skills

Gather and analyse information in decision-making by applying logical thinking

Systems thinking; Organisational knowledge; Problem identification; Problem analysis and solving

Act in a manner that demonstrates self-knowledge and self-awareness

Self-awareness

Emotional self-awareness; knowing strengths and limitations; Self-confidence

Manage self in a manner that contributes to the activities of the board

Self-management

Emotional self-conrol; Transparency; Adaptability; Achievement; Positive demeanor

Social awareness

Adapt to environmental needs

Interact with fellow board members and management in a manner that is beneficial to the company

Understanding others' perspectives and taking an active interest in their concerns; Reading the currents, decision networks and politics at the organisational level; Recognising and meeting staff, client and member needs

Inspirational leadership; Influence and persuasion; Developing others; Change catalyst; Conflict management; Building relationships; Teamwork and collaboration

Relationship management

FUNDAMENTAL VALUES

These competences are underpinned by 5 fundamental values, namely:

Conscience: A director should act with intellectual honesty and independence of mind in the best interests of the company and all its stakeholders, in accordance with the inclusive stakeholder approach to corporate governance. Conflicts of interest should be avoided.

Inclusivity of stakeholders is essential to achieving sustainability and the legitimate interests and expectations of stakeholders must be taken into account in decision-making and strategy.

Competence: A director should have the knowledge and skills required for governing a company effectively. This competence should be continually developed.

Commitment: A director should be diligent in performing his duties and devote sufficient time to company affairs. Ensuring company performance and compliance requires unwavering dedication and appropriate effort.

Courage: A director should have the courage to take the risks associated with directing and controlling a successful, sustainable enterprise, and also the courage to act with integrity in all board decisions and activities.