A non-executive director (NED) is typically an objective, independent, and unbiased individual who provides both a creative and unique contribution in the boardroom. NEDs are expected to concentrate on matters of the board and to stay clear of making any executive decisions. In doing so, they provide a keen insight as well as an independent perspective of the corporation, apart from its daily operations. They are responsible, however, in much the same way as the executive directors of the company.
In order to limit potential liabilities for NEDs, they must constructively challenge and constantly ask various questions of the company’s executives. Furthermore, they need to ensure that all requested information is properly delivered in a timely manner and also seek professional advice independently at the expense of the company if they deem it necessary to release their key responsibilities.