Non-executive directors meet the following requirements:
According to laws, regulations and other relevant provisions, it is qualified to be a director of the company; Have basic knowledge of the operation of large companies and be familiar with relevant laws, regulations and rules; Having at least five years of legal, economic or other work experience necessary for performing the duties of a non-executive director;
Other conditions stipulated by laws, regulations, relevant provisions and the articles of association. The main duties of non-executive directors are 1. Strategic direction As an outsider, non-executive directors may have a clearer or broader understanding of the external factors affecting the company and its operating environment than executive directors.
Therefore, the normal role of non-executive directors in strategy formation is to provide creative and informed contributions, and to act as constructive critics when reviewing the goals and plans designed by the CEO and the executive team.
2. Monitoring performance Non-executive directors should be responsible for monitoring the performance of the executive management, especially the progress made in achieving the established company strategy and objectives. They play an important role in appointing, removing executive directors when necessary and succession planning.
3. Remuneration Non-executive directors are also responsible for determining the appropriate remuneration level for executive directors.
In large companies, this is done by the remuneration committee to ensure that there is an independent procedure to determine the remuneration of executive directors.
4. Communication companies and their board of directors can benefit from external contacts and opinions. Therefore, an important function of non-executive directors can be to help enterprises and boards of directors to establish contacts with potentially useful people and organizations. In some cases, non-executive directors will be required to represent the company.
5. Risk Non-executive directors should ensure the integrity of financial information and the robustness and defensibility of financial control and risk management systems.
6. The responsibility of the audit board of directors is to ensure that the company correctly opens an account with shareholders by truly and fairly reflecting its behavior and financial performance, and regularly and strictly monitors the necessary internal control system. Whether a formal audit committee (composed of non-executive directors) is established or not, non-executive directors play an important role in fulfilling this responsibility.