Book Review: Directors’ Handbook By Mark Wearden

Ian Garner, Director at Practical Solutions reviews Directors' Handbook for the business pages of the Yorkshire, Lancashire and Cumbria Times.

Mark Wearden* has worked extensively with directors and senior managers from a wide range of different type and size of organisation. He provides consultancy, seminars, workshops and lectures on governance and business strategy, helping directors deal with the challenges and contradictions between theory and practice.

Mark’s book, Directors’ Handbook, aims to be a guide to being a director and a resource to tackle the duties and best practice that goes with that role. It intends to help the reader keep up to date with recent changes to legislation and regulations.

The Directors’ Handbook largely achieves what it sets out to do and is a comprehensive guide to the essential duties and requirement of a director and a company.

As you would expect It’s quite a weighty tome, which is quite daunting from a first impression but don’t worry, you can read some sections and dip in and out of others.

The book should appeal to all directors, from those who are experienced and long-standing directors but could benefit from a refresher, and those new to the role who have a steep learning curve ahead of them.

This book is an important toolbox for experienced directors, who may think they know the duties and obligations that come with the position but haven’t caught up with recent changes or forgotten some of the finer points, traps and trip wires they need to avoid.

The Handbook will be important for directors of SMEs and start-ups, some of whom may think it doesn’t apply to them. If someone describes themselves as ‘founder’, ‘entrepreneur’ or similar titles may think they are not a ‘director’.

However, in law anyone who is someone who is involved in the day-to-day management of a business but has not been formally appointed as a director or someone who tells the business what to do may also be considered to be a director for the purposes of company law.

Directors who have not been formally appointed might nonetheless be subject to the same statutory duties and obligations, and potential sanctions, as are imposed on formally appointed directors.

The layout of the book, in easy-to-follow sections, covering everything from the individual duties and responsibilities of a director, through to the regulatory and legislation requirements of a company is helpful. There are comprehensive appendices and an index which facilitates a pick and mix approach for the reader.

This is not a book for holiday reading, nor reading from cover to cover, but is an essential guide to being a good director and running a successful and compliant company.

The book provides help for directors, and lays out their obligations to the company, shareholders and stakeholders. It informs the reader on statutory and other duties, such as health & safety, bribery & corruption and financial duties and helps avoid pitfalls, because it is well established that ignorance is no defence in law.

A particularly important section for the reader is section 8 – penalties and sanctions. If you start looking at the consequences to the business, and to you as an individual, you quickly appreciate the importance of getting it right and what you and/or the business can suffer if you get it wrong.

I found the section on governance (section 17 – The meaning of governance) and the section on purpose (14 – Corporate purpose), essential early reading to remind me of the basics. The individual sections provide great insight to the philosophical as well as technical ways of dealing with the individual issues. It important we understand ‘why’ as well as ‘what’ and ‘how’ if we are going effectively to do ‘it’ right.

To business people ‘governance’, ‘purpose’ and ‘compliance’ are critical elements of a successful business but can be misunderstood or neglected as businesses focus on sales, growth and profitability. The Directors’ Handbook gives business leaders, and potential business leaders a handy guide to running a compliant and well-run company which holds its value and is well placed to expand and grow.

The first appendix – FRC the UK Corporate Governance Code, is a comprehensive view of the UK Corporate Governance Code goes right back to the code first published in 1992 (the Cadbury Report). It is brought up to date with the 2018 code from the FRC (Financial Reporting Council) and is clearly laid out with principles and provisions to make for easy understanding and interpretation.

I enjoyed the refresher that this book offers and feel it would be a useful edition to any collection of business books and guides to help you be the best and most successful director which, I’m sure is what we all want to achieve.



* Mark Wearden will be contributing a Saturday Essay next week.
Read Andrew Palmer's interview with Claire Bodanis on Why the Annual Report Matters
https://www.yorkshiretimes.co.uk/article/Saturday-Essay-Why-The-Annual-Report-Matters-And-How-To-Do-It-Well-1