It’s no longer business as usual in the boardroom
The days of directorships being little more than a perk are over. Thanks largely to the global impact of Sarbanes Oxley Act 2002, members of any board must be prepared to execute their duties at nothing short of a professional level.
Mr Finkbeiner, who is the chief operating officer at Bermuda Commercial Bank Limited, said that while Bermuda’s boardroom standards are already high: ”My message is how very important it is to have a strong board and strong governance, and part of that is having directors who have undertaken professional development.”
He said that he was already an experienced director having sat on BCB’s board for ten years, yet: “The complexity of our world demands that we are as proficient as possible to manage our companies.”
The Institute of Directors Bermuda Branch, which offers the educational programme leading to the Chartered Director designation, was recently revitalised under the guidance of its now-chairman, retired reinsurance executive Roger Gillett after a four-year hiatus. In a Bottom Line Magazine article last year, he said: “I recognised ... that there was a huge upheaval going on in the corporate world, particularly in financial institutions, which has concerned many people in my position. It has taught us to focus much more attention on the responsibilities of directors. They are now much more aware that they are accountable to the members or shareholders for the success of the organisation, and similarly the board has to ensure that the management is held accountable.”
Mr Finkbeiner expanded on this, saying: ”There is a real correlation between the strength of a company and their board. Directors are tasked with overseeing strategy and the development of the company. You need a broad base of knowledge, but part of the process is being willing to participate and ask challenging questions.
“I think what we’re finding is that it is already mandatory to have fully qualified people on a board — particularly for financial institutions. The directors of a financial institution must have the required expertise and ability to be on a board for the regulated entity. For example, if you are on the audit committee for a financial institution, you need to have a strong financial background, and to be willing to undertake continuing education, to be up-to-date and knowledgeable.”
At the time of the relaunch of the IoD, Mr Gillett said: “Bermuda has a very unique position at the crossroads of the USA and UK and regulation is becoming more and more complex so it’s important that Bermuda-based directors are up-to-speed with the latest developments in corporate governance and directors’ responsibilities. We hope that our educational programme and networking opportunities will provide an avenue for directors to grow their knowledge and skill base.”
Mr Finkbeiner, expanding on those comments, said: “Bermuda is managing closer and closer to the standards you get in other jurisdictions, such as the United Kingdom’s standards.” He said it was for this reason that he elected to take the UK IoD programme. “It allows you to learn and understand what is required at a higher level.
“It’s a fantastic programme — though it’s not easy, I can tell you.”
There are three stages comprising the Chartered Director award. They are: the Certificate in Company Direction, the Diploma in Company Direction and the Chartered Director Interview.
According to the IoD UK website, the programme is designed so that participants will get a broad understanding of the role of a director and the role of the board. To earn the designation, there are examinations, peer reviews and a portfolio of directorial experience is also required.
The IoD website stated it is a non-partisan business organisation founded in London by Royal Charter in 1903, currently with around 37,000 members worldwide. It provides directors with the information and advice, and membership spans international business leadership, from the largest international companies to the smallest private firms.
The Bermuda branch of the Institute of Directors was founded in 1991.