Non-Executive Director

AAA

DEFINITION of 'Non-Executive Director'

A member of a company's board of directors who is not part of the executive team. A non-executive director (NED) typically does not engage in the day-to-day management of the organization, but is involved in policy making and planning exercises. In addition, non-executive directors' responsibilities include the monitoring of the executive directors, and to act in the interest of any stakeholders. Also called external director, independent director and outside director.

INVESTOPEDIA EXPLAINS 'Non-Executive Director'

Non-executive directors are often included in a firm's lineup for public relations reasons; for instance, the non-executive director's community status and experience could provide good exposure for the firm. Even though they are non-working directors, they can share liability with the executive directors of the firm.

RELATED TERMS
  1. Boardroom

    Besides the general definition as a meeting room in an office, ...
  2. Inside Director

    A board member who is an employee, officer or stakeholder in ...
  3. Board Of Directors - B Of D

    A group of individuals that are elected as, or elected to act ...
  4. Outside Director

    Any member of a company's board of directors who is not an employee ...
  5. Chair Of The Board - COB

    The most powerful member on the board of directors who provides ...
  6. Adverse Domination

    A legal doctrine that allows regulators to bring litigation against ...
Related Articles
  1. What is the difference between a shareholder ...
    Investing

    What is the difference between a shareholder ...

  2. Evaluating The Board Of Directors
    Insurance

    Evaluating The Board Of Directors

  3. The Basics Of Corporate Structure
    Investing Basics

    The Basics Of Corporate Structure

  4. Evaluating A Company's Management
    Active Trading Fundamentals

    Evaluating A Company's Management

comments powered by Disqus
Hot Definitions
  1. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  2. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  3. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  4. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  5. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  6. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
Trading Center