Sir Nicholas Montagu is Chairman of the Financial Ombudsman Service and the Board of Governors of Queen Mary University of London. Prior to this, Sir Nicholas was Chairman of the Inland Revenue and Aviva With-Profits Committee, Deputy Secretary at the Department for Transport and Director of a handful of private equity-owned companies.
What are the differences between private and public sector boards?
I’ve never sat on a PLC board but my colleagues who have complain that they are so weighed down with briefing papers and bureaucracy that it’s impossible to have any kind of meaningful debate. This seems vastly different from the private equity style board meetings which tend to be small, informal and mostly paper-free.
Across Whitehall, ministers set the agenda giving political direction, while the executives run their department and the role of the board varies greatly.
Ministers argue for less risk aversion but do not always allow their board and executive the flexibility to deliver this. In the current financial climate there needs to be greater freedom and rolling back of frontiers. Bond issues and new public/private partnerships provide major opportunities, not least for the future funding of our universities.
What changes would you make to improve a board’s effectiveness?
Getting the right people and the right number of people around the boardroom table is a critical first step. At the Financial Ombudsman Service I took the number of executives who attended board meetings from six to three, and the number of non-executives from nine to six. This more manageable size enables us to have proper debates and allows everyone to have their say.
Once you’ve got the right people, you need to create a conducive tone and dynamic. I’m all for informality – jackets off and first-name terms. I want my board to get to the heart of the issues that really matter, not to stand on ceremony.
How important is information in the boardroom?
Good information is crucial. But we need to see the wood from the trees. Wading through piles of paper is the least profitable way to absorb the facts.
Board papers should draw out the key issues, not drown the reader in operational detail. That’s what you need for good governance.
How will the UK's global influence change over the next decade?
It’s likely that the UK will remain an important financial centre on the world stage. But the growth of China and other developing countries will shift the balance of power and influence.
What is the smartest business decision you've made?
Our decision at the Inland Revenue to put £75m into a much needed transformation programme was a wise move. It was important that we put our money where our mouth is, to achieve real change.
What books are on your bedside table?
I love a good thriller! Torquil MacLeod’s Meet Me in Malmö has me gripped at the moment. But I’ve also been enjoying The Old Ways: A Journey on Foot by Robert Macfarlane, which reminds you of the simple power of walking.
What is your Golden Rule?
Openness is everything. And never treat your friends badly.
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