Borrowed credibility is not due diligence

Kirsten (KP) Patterson

I was reading recently about a charity that had experienced serious governance and reputational issues. One comment stayed with me. 

The organisation took comfort in knowing an individual already sat on a prominent local board and was involved with several other charities. Those appointments were seen as evidence that the person was an upstanding member of the community.

That assumption may be understandable, but another organisation’s appointment process is no substitute for your own due diligence. 

A place on another board tells you only that a person was appointed, nominated or elected at some point.  It tells you nothing about the checks undertaken beforehand, how the person is performing now or whether concerns have since arisen. 

In some organisations, directors are elected by members. In others, they are appointed by stakeholder or representative groups. The board itself may have had little or no opportunity to test the candidate before their appointment. 

Even where a board made the original appointment, circumstances may have changed. Performance issues around board tables are seldom visible from the outside. Some constitutions also make it difficult to address an appointment that has not worked out. 

The Institute of Directors' 2025 Director Sentiment Survey illustrates the point. Only 18.8% of not-for-profit boards reported having a process for dealing with problematic or underperforming directors. Formal board evaluation was also far from universal. 

Another organisation’s board list is not a reference check and it is certainly not a clearance certificate. 

The IoD’s Four Pillars framework starts with the importance of boards in enabling organisations to achieve their mission or purpose. Its focus on an effective governance culture includes integrity, transparency, accountability and ethical conduct. 

For not-for-profits, those qualities have particular weight. Purpose and reputation are often among an organisation’s most valuable assets. The people around the board table are stewards of both. 

Due diligence does not have to be expensive 

Many organisations use specialist search firms, including the IoD’s Board Appointments service, for background checking and detailed appointment processes. Many not-for-profits cannot. That should change the scale of the process, but not the standard of care behind it. Search firms can bring reach and discipline. The discipline is something every board can replicate. 

The IoD’s new Board Appointments Checklist sets out that discipline from start to finish – from clarifying the board’s needs and setting up the appointment process, through candidate assessment and due diligence, to appointment and induction. It is designed for nomination committees, chairs and governance teams and can be used whether a board manages recruitment itself or brings in external support. 

For many appointments, a good process will cost mainly the time of the chair, nominations committee or two experienced board members. The checks should be relevant to the role, proportionate to the risk and undertaken with the candidate’s knowledge and appropriate consent. The checklist provides the wider appointment framework. For due diligence specifically, a practical, low-cost process might include: 

• • Define the role first. Be clear about the capability the board needs, the organisation’s purpose, expected behaviour and the time commitment. A familiar name should not become the job description. 
  • Use a candidate declaration. Ask about current governance and employment roles, conflicts of interest, availability and any relevant matters that could affect eligibility or the ability to serve. Make expectations about disclosure clear. 
  • Verify material claims. Check identity and the qualifications or experience that are important to the appointment. Confirm relevant governance roles through reliable public sources rather than relying only on a curriculum vitae. 
  • Take structured references. With the candidate’s consent, speak to people who have seen them operate in governance or senior leadership settings. Ideally, include somebody who has chaired them and somebody who has worked alongside them. Ask the same questions of each referee. Do not ask only whether the candidate is “a good person”. Ask how they handle challenge, confidentiality, conflicts, disagreement and accountability. One particularly useful question is: “Would you appoint this person to your board again?” 
  • Undertake proportionate public checks. Look for information relevant to the appointment through appropriate public registers and reliable public sources. Does their public and social media presence match up? If something material appears inconsistent, ask the candidate about it. Internet searches can contribute information, but they should not become unstructured reputation trawling or replace proper verification. 
  • Interview for judgement and behaviour. A CV will not tell you how someone behaves around a board table. Ask candidates how they have handled a difficult board disagreement, a conflict of interest, poor organisational performance or a situation where speaking up was uncomfortable. Listen for judgement, self-awareness and willingness to challenge constructively. 
  • Test capacity as well as capability. Several impressive board roles can be a positive signal, but they can also raise a question about availability. Ask what happens when several organisations face a crisis at once. Understand the candidate’s real capacity to prepare, attend and contribute. 
  • Record the process and the decision. Keep a short record of the checks completed, material issues considered and the board’s reasons for proceeding. Higher-risk organisations or roles may warrant more extensive checks, particularly where significant funds, vulnerable people, regulated activities or high levels of public trust are involved – for example, police, credit or other appropriate checks.  

Most of these checks cost time rather than money and some require directors to ask questions that may feel uncomfortable.
 

What if directors are elected? 

Elected boards can present a different challenge. A board may not have the power to select candidates or prevent a person who meets the constitutional requirements from standing for election. That does not mean the organisation has to abandon appointment discipline. The work starts earlier in the process. 

The organisation can make the role and expectations clear before nominations open. Subject to its governing document and applicable law, it can establish appropriate eligibility and declaration requirements, explain expectations around conflicts of interest and provide members with useful information about candidates. 

In some organisations, a nominations committee may also be able to assess candidates and give members information about the capabilities the board needs, depending on the constitution. 

After an election, strong induction should be backed by a code of conduct, good conflicts management, board evaluation and clear processes for addressing performance concerns. 

If the constitution repeatedly prevents the organisation from dealing effectively with poor governance appointments, that may itself be a governance issue worth reviewing. 

Do not outsource the board’s judgement 

The IoD’s 2025 survey describes succession planning as one of the weaker areas of governance discipline. Only 41.5% of respondents reported having a succession plan for board members or committee chairs. The survey also notes that reactive recruitment can draw boards back to familiar networks instead of considering the capability they will need in future. 

When everyone is busy and a respected person volunteers to join, saying yes can feel like the practical answer. Due diligence can then become a series of boxes that someone else has ticked. 

• • “The search firm checked them.” 
  • “The nominating organisation put them forward.” 
  • “They are already a trustee of three charities.” 
  • “We know their referee.” 

None of those statements removes the responsibility of the appointing board to exercise its own judgement. 

Not-for-profits often ask communities, donors, volunteers and funders to place considerable trust in their organisations. 
Boards need to be equally careful about where they place theirs.