Independent directors

Members can appoint independent directors to the board if it is in the rule book. An independent director is a director who is not a member. They usually have special skills or knowledge.

You might appoint an independent director when:

  • your board has a gap in skills or knowledge
  • you need some extra support in a busy time or for a project
  • this person could help with a short or long-term strategy
  • your corporation is looking for a different view or voice.

Benefits of independent directors

Hiring an independent director with the right match of skills can benefit everyone – the corporation, the community and the person you hire.

Corporation benefits

Having a skilled professional on your governing body can:

  • boost your capacity 
  • give you access to important advice and expertise that might be otherwise difficult to get. 

They do this through:

  • strengthening governance structures and processes
  • providing access to skills and expertise
  • bringing a different perspective
  • providing specialist advice.

Individual benefits

Independent directors get the chance to develop skills, knowledge and have new experiences as they:

  • contribute to Aboriginal and Torres Strait Islander community wellbeing
  • gain corporate and Indigenous governance experience
  • build cultural competency
  • expand networks
  • contribute to the success of a corporation
  • strengthen communication and leadership skills.

Find an independent director

You can search for and connect with independent director candidates:

Before advertising a vacancy, prepare your brief. The brief might include your corporation’s story, including:

  • a brief history of the corporation
  • vision and goals
  • business activities, key projects or services
  • number of corporation members
  • structure of the corporation and any relationships with other entities, trusts or advisory groups etc
  • current board and proposed board composition
  • organisation/staffing structure and overview of key people
  • the corporation’s rule book
  • policy documents
  • names of key stakeholders, funding bodies or creditors
  • financial performance
  • funding landscape.

Add your corporation’s context, including:

  • who owns Country
  • community overview
  • key people
  • market overview.

You could also include some of this information in your induction material for the new independent director.

Choosing an independent director

Check your rule book for any rules around appointing independent directors.

There are a few ways you can select an independent director, for example:

  • a nomination committee
  • a selection panel 
  • external advisers.

Alignment with the corporation

Look for someone with the right knowledge, skills, qualifications and experience to support your board. 

Before you appoint the independent director, meet in person. Make sure you’re comfortable and confident with each other so you have a strong and positive relationship.

Get to know their personality and whether they can work well with your board and staff.

You might invite some candidates into your community to meet people in your corporation and make sure they’re a good fit. Consider having:

  • an in-depth discussion about the organisational culture
  • a visit to the corporation’s premises and community.

Any independent director must be willing to:

  • follow the corporation’s rule book, policies and procedures
  • be punctual and reliable
  • be accountable
  • review relevant papers or reports before meetings
  • respect confidentiality
  • respect culture
  • give appropriate notice if their availability or personal circumstances change
  • fulfil the duties and responsibilities of an independent director
  • support other directors.

Independence

Ensure the independent director is not associated with:

  • current directors
  • staff
  • legal advisers
  • members
  • corporation affairs.

It’s important to do this to avoid conflict of interest.

Skills and experience

Make sure their expertise fits with your needs and adds value. That includes:

  • if they’ve been on other boards, especially with a similar vision or services, and how those boards performed
  • if they can introduce you to new networks or business contacts
  • that they have cultural competence.

Skills they might bring include legal, accounting, compliance, investment, IT, marketing or strategic planning.

Check referees for evidence.

Ability to do the job

The independent director will need to give lots of time to their duties. Some things you might check include:

  • how many boards they already sit on
  • whether they have time to be personally aware of the corporation’s business and financial position
  • how far they will travel
  • if they have a job and if they can leave their regular work duties to do their board duties
  • if there are any other personal factors that might stop them doing their duties with your corporation.

You might also like to plan for what happens if the independent director’s employment changes while they’re on your board.

History and records

Check if the independent director:

  • has been charged or convicted of an offence
  • is undischarged bankrupt
  • has been banned from managing an Aboriginal and Torres Strait Islander corporation

Check for their name on the register of disqualified officers. You can also check ASIC’s register of banned and disqualified persons.

Inducting an independent director

Get your new director up to speed fast so they understand the corporation’s values and priorities and can contribute meaningfully right away. 

Key information at the start includes:

  • organisational culture
  • values 
  • working processes.

To be effective in their roles, directors need to know:

  • corporate overview
  • community and cultural context.

You can give this in an overview document or brief, and they’ll learn more on the job.

Help the new director understand more about where you work and who you work with. Some ways to do this include:

  • making a short video about the corporation and community
  • partnering the independent director with a cultural mentor to answer questions or guide them on cultural protocols and tips
  • meeting with the rest of the board and key stakeholders such as Traditional Owners, corporation members and community
  • meeting with key staff such as the CEO or managers, plus sessions with small groups of staff
  • an informal morning tea or lunch for staff and directors to share information 
  • allow the independent director to work at the frontline of the corporation’s business.
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