Sir Andrew Likierman is Dean of the London Business School, Chairman of the National Audit Office and a NED of Barclays. He is a former President of CIMA and NED of the Bank of England.
What would you change to make UK boards more effective?
The board should set itself objectives for the year, just as individuals do. A restatement of these objectives should be included in every board pack to focus the directors’ minds on what they are there to do, and to guard against minor operational issues dominating board time and attention. At the end of each year, as part of the annual board appraisal, the board should then ask itself “So how did we do?”.
Have boards changed much in the last few years?
Yes. As a member of the Cadbury Committee which was the architect of modern governance in the UK, I can remember boards telling us that they simply didn’t know what the benchmark was. That’s certainly not the case anymore. Boards have improved immeasurably and our ‘comply or explain’ regime provides the flexibility to accommodate special and different circumstances. So yes, a lot has changed and I believe boards have improved a great deal.
How could, or should, the role of the Company Secretary evolve to better support the board?
The Company Secretary can add a huge amount of value by playing an active role in helping the Chairman and board members to make the most of their roles. From the structuring of agendas to board appraisals, the guiding hand of the Company Secretary can help to get the best out of those around the boardroom table. I see their role as a trusted advisor to the board – especially to the Chairman.
How important do you consider information to be in the boardroom?
It’s utterly crucial, yet in most organisations it’s not good enough and in some cases it’s just hopeless. I’ve seen board packs that are boring and incomprehensible, with either too much or too little detail and which focus on the wrong things – overweight in retrospective financials and underweight in competitor analysis. Board packs are often crammed full of data but they fail to draw the key distinction between information and insight. This is another area where the Company Secretary can raise standards, acting as the intermediary between the business and the board.
What is the smartest decision you’ve made?
Coming to the London Business School in 1974. UK business schools were fairly unknown at the time, so my decision was a leap of faith. But I felt LBS was an exciting place with lots of potential and I was right; today we are recognised as one of the leading business schools in the world. I’m proud to be a faculty member and, more recently, the Dean.
What book is on your bedside table?
I’m just finishing ‘Capital’ by John Lanchester, a novel which is a terrific mirror of London in 2012, and I’m about to start Dominic Sandbrook’s latest social history of the UK, ‘Seasons in the Sun’. It deals with the 1970s, which is when I was working at the Cabinet Office. At the time, the UK seemed to be heading towards social and economic disaster but in the end we pulled through. Economic cycles, with their ups and their downs, are the natural state of things. As an optimist, I like to remind myself of this when our outlook is at its most bleak.