Conducting due diligence before accepting a directorship

CONGRATULATIONS! You have been invited to join the board of a company that fits your profile and interests. However, on no account should you jump into a particular directorship without doing your own due diligence.

Read up all available reports such as annual reports, press articles and filings with the stock exchange. And search the Internet - it's surprising what it can throw up.

Take some time to visit the company to get a better idea of operations and meet other board members (in particular, outgoing directors) and senior management. By asking the right questions, you should be able to get some feeling of their competence and the culture of the company.

Ask your friends and contacts whether they have any inside knowledge or know of any adverse issues concerning the company. Usually word-of-mouth checks with friends and contacts can reveal nuggets of information and a…