The appointment and conduct of departmental NEDs

Matt Hancock’s resignation – and Gina Coladangelo’s role as a departmental non-executive director (NED) – has exposed the growing need to clarify rules and improve transparency around the appointment and conduct of NEDs.

NEDs are expected to provide “robust scrutiny and challenge on departmental progress”. They chair departments’ audit and risk committees, have considerable access to people and information and, in some cases, influence with ministers.

But Gina Coladangelo’s closeness to the former health secretary, her previous role as his unpaid adviser, and her support of his campaign for the Conservative Party leadership meant that she was not well placed to provide the independent challenge and scrutiny expected of NEDs.

This report reveals that 20% of current NEDS have significant political experience or party alignment. This raises questions about whether the distinct value they add to the existing ministerial and adviser teams in departments has been maximised. NED appointments are not regulated by the commissioner for public appointments, making it impossible to know whether candidates are genuinely being appointed on merit, or if advantage is being given on grounds of political affiliation.

It sets out proposals to tighten the governance around NEDs’ roles. It calls for the introduction of checks on the appointment of NEDs with political experience or party alignment, and the creation of mechanisms to increase transparency and accountability – including to parliament as well as ministers.

It also recommends that:

• The appointment of departmental NEDs be treated like that of other members of public boards and regulated by the commissioner for public appointments.
• Permanent secretaries ensure that every department publishes full information about each departmental NED appointment process and its outcome.
• Elected representatives with party affiliation (such as MPs, councillors and members of devolved parliaments) or current special advisers are not appointed as departmental NEDs.
• Every department publish a readily available quarterly register of interests that includes each member of their departmental board.
• The government lead NED and all departmental NEDs should appear in front of relevant parliamentary select committees if called. They should do so independently and free from ministerial instruction.