Instead of waiting till retirement looms, executives in their thirties are acquiring the skills to swap a full-time post for a Non-Executive Director Portfolio Career, says Hannah Prevett
Having plumped for a career in professional services, Jan Babiak was aware she had an expiry date. For this reason, she started planning her non-executive career while she was in her thirties and was a rising partner at EY.
“One of the things about the big four and a lot of large organisations is a mandatory retirement age of 60,” said Babiak, now 56 and a non-executive director at Experian, the data company, and Walgreens, the American pharmacy chain.
“My grandmother lived to be 100. There was no way I was going to sit around for 30 or 40 years doing nothing after retirement, so in my late thirties I sat down and mapped out what my life might look like later.”
Babiak was not leaving anything to chance. “People who claim to be strategists in business often don’t apply that to themselves. You should be planning your career throughout your life,” she said. “Becoming a non-executive was part of an intentional path, not being force-retired out of a company and then hoping you got lucky and somebody called you to say, ‘Hey, mate, come on my board’.”
Having decided on the next stage of her career, Babiak was able to tailor the work she undertook at EY. “Whereas a lot of people would be keen to focus on working with as many big, prestigious clients as possible, part of what I felt I needed to do to prepare me for the future was to manage a big profit and loss account as well,” she said.
Michael Murphy, former global chief executive of Grayling, a communications agency, recently joined the board of London Metropolitan University. Planning a portfolio career at a young age is typical of a new breed of non-executives, he believes.
“My own portfolio was a long-term aspiration for me and I think that’s increasingly the trend in the non-executive world,” said Murphy, who is 60.
Though he started planning his non-executive career 10 years ago, he had been building towards it for far longer. “I’ve done non-executive stuff for three decades, from when I was in full-time executive positions. I undertook the Institute of Directors non-executive training a long time ago and I have joined an organisation called Criticaleye, which runs training programmes and retreats and other events,” he said.
While there’s no harm in planning ahead, it can be beneficial for candidates to remain in executive roles until they are confident they can maintain a rewarding portfolio, said Edward Wild, founder of the headhunter Wild Search.
“It will be more difficult to return to an executive role after several years in portfolio mode, in addition to which the executive experience will be further back in their careers. Most boards will have a balance of those who have a full-time role and others who have a portfolio,” he said.
Remuneration is another challenge. “Starting a portfolio career earlier in life can be rewarding and fulfilling but it is important that someone considering it doesn’t do so predominantly for financial reasons, since it takes time to build up a portfolio,” Wild said.
Murphy agreed that the prospect of leaving a well-paid post to go plural is daunting. “A lot of people feel a little bit insecure moving from a full-time role with a set salary into a situation that is much more fluid from a financial point of view.”
Mark Winlow, 52, chairman of Ageas Insurance, expects boardroom pay to improve to reflect the increasing demands of the job. “I’m sure that the value of non-execs will rise as we become more professionalised and the risks we are taking are recognised, as is the quality of the contribution we are making,” he said. Winlow’s CV includes partner at KPMG and managing director of personal lines insurance at Zurich Financial Services, where he had responsibility for a £900m profit and loss account and led 2,350 people.
Why did non-executive life appeal when he was in his early forties? “I enjoyed being an executive, but my personality is such that I like to be involved in a number of things and I have the discipline to partition my working life,” he said.
Chairmen are likely to welcome a trend that means aspiring nonexecutives are becoming younger, said Jennifer Sundberg, managing director of the consultancy Board Intelligence.“A lot of chairmen tell me how hard it is to persuade the best candidates to take up a non-executive position on their board as the mismatch of risk to reward is growing. So it’s good for business and for society if there are younger people who aspire to the role and are willing to put in the groundwork to prepare for it,” she said.
Merely having fulfilled an executive role does not guarantee success as a non-exec, added Sundberg, 34. “In France, you don’t spend a few decades at the Bar and then metamorphose into a judge. Instead you train to become a judge from a young age, recognising the distinct skills it requires. If candidates are putting more thought into how they prepare for the distinct demands of a non-executive role, other than succeeding as an executive, that may be a good thing.”
The burgeoning trend for young non-execs means, of course, that there is more rivalry for posts. “If people are entering their non-executive career earlier there will be more competition,” said Wild. “Even trusteeships of charities are very popular. We’ve just been working to find someone to run a small charity and we were amazed at the interest in it.”
Start thinking about it early
Having started a portfolio career at the age of 50, Mark Winlow sees part of his role as helping those in executive jobs to do the same.
“Lots of people leave it to the last minute to think about what skills and experiences they might need to become a candidate for a plural career,” said Winlow, 52, whose non-executive posts include chairman of Ageas Insurance.
“Part of my role as a non-executive is to make people think about one or two things outside the hurly-burly of today.
“If they are involved in a successful, busy company and they are the type of people who throw themselves into it, it can be quite difficult to think about how they should be preparing for the next stage of their career.
“Part of what the chairman should be doing is saying to the chief executive and the finance director, ‘I really believe you should think about this because it will help you in two ways: it will help you in your career longer-term, but also it will help you to understand the perspective I am bringing into this organisation and why the non-executives ask the questions they do’.”