Non Executive Directors - What you need to know?

As levels of boardroom regulation have increased, more and more businesses are appointing Non Executive Directors (NEDs) to their boards in order to assist the management team with risk management, compliance and governance.

While executive directors help to run a company’s business, NEDs don’t have daily management responsibilities. As a result, they have the time to contribute to the development of the firm’s strategy, monitor the performance of the management team and ensure that appropriate risk management processes are in place.

Whereas executive directors can be too busy with day to day duties, NEDs are there to point out what the management team doesn’t know. They also help to ensure that a small group of individuals can’t dominate the board’s decision-taking.

So where do you find a NED for your board? NEDs tend to be people with extensive managerial experience in areas such as finance, marketing, sales or legal. Many businesses find their NEDs through word of mouth or business contacts. An alternative is to use an executive recruitment agency.

In order to get the most out of having a NED on your board, you should create a clearly defined job description with a strong letter of appointment, setting out exactly what is expected of them.  NEDs should operate at more of a strategic level, challenging executives and providing the board with an independent perspective. It’s not just the business that needs to be careful, as NEDs face considerable personal risks in terms of personal liabilities if a business were to fail. They are as accountable as other directors to the regulators and shareholders of the business.

NEDs are not necessarily as important to the success of a business as a chief executive or management team but they can provide expertise, guidance and perspective which can help to pave the way to success for the firm.

The Art of Copywriting!

In the digital age, content is king. Businesses want to communicate with customers and targets on a regular basis. Firms are now producing more content than ever before for websites, blogs, newsletters, social media and press releases but the quality of that content can vary dramatically.

Many businesses create their content internally. It is usually produced by subject matter experts or enthusiastic amateurs. Others employ external experts to do the hard work. There is no right or wrong way of producing your content but it is important that there is a degree of consistency across all of your firm’s copy so that the brand values and “feel” of the messaging is consistent.  For example, if your brand majors on providing simple but effective solutions which are “to the point”, then allowing some of your people to produce long-winded content would go against your brand and could effectively undermine it.

Most businesses will have some sort of internal review process which content must go through before being approved for distribution. It is important to have an appropriate number of stakeholders involved in your approval process. Too many and they could drag the approval process out and make the copy very “watered down” compared to the original version. Too few and there is an increased risk of some inappropriate or incorrect content making it through and being published.

How many individuals are involved in the approval process depends on the type of business that you operate. For example, if your firm is a regulated entity, in say, financial services or the legal sector, then you may need to have compliance people involved in your approval process. However in a less regulated industry like fashion, perhaps the approval process should involve a subject matter expert and a product manager.

Regardless of the type of industry that you are in, creating engaging content is key. Whatever you produce must be on-message and should be of interest to your readers. You should aim to tell a story, draw your reader in and show how your product, service or knowledge adds value for your customers or potential customers. Your copy should be well crafted, balanced and should flow. If you are inserting key words for search engine optimisation (SEO) purposes, you should intersperse them throughout your text in a way that seems natural to your reader.

Finally, it is good to have a 4-eyes approach - i.e. 2 people read the content before it is finally published. This helps with sense checking and typo spotting.

Strategy Vs. Culture!

“Culture eats strategy for breakfast.”

These words, often attributed to Peter Drucker, are frequently quoted by people who see culture at the heart of all great businesses.

Strategy is written down on paper whereas culture determines how things get done. Most people can come up with a strategy, but it’s much harder to build a winning culture. Moreover, a brilliant strategy without a great culture is ‘”all talk and no action”, while a company with a winning culture can succeed even if its strategy is mediocre. It is far easier to change strategy than culture.

Strategy ultimately consists of two aspects; which sectors should you be in and what is the value proposition that you will go to market with in each of those sectors?
A business’s cultural strengths are central to the first aspect of your strategy (sectors). For example, Ryanair has a culture of keeping costs down and offering cheap prices. As such, they would probably not succeed if they entered the premium, private jet sector where wealthy clients expect high-end service and the best of everything.

Maintaining cultural coherence across a company’s divisions should be an essential factor when determining a corporate strategy. No culture, however strong, can overcome poor choices when it comes to corporate strategy. The second aspect of your strategy is the value proposition. Customers consider more than concrete features and benefits when choosing between alternative providers. They also consider “the intangibles.” In fact, these often become the tiebreaker when tangible differences are difficult to discern. For example, Virgin Airlines tries to attract passengers who like its casual, fun and non-establishment attitude in how it operates.

The businesses with the best cultures have instilled norms of behaviour that are essential features of their winning value propositions. For example, in Virgin’s case, offering consistently fun service at a reasonable price. What these companies really demonstrate is how culture is an essential variable - much like your product offering, pricing policy, and distribution channels - that should be considered when choosing strategies for your business. This is especially so when the behaviour of your people, and particularly your frontline staff, can give you an edge with your customers.

Strategy must be rooted in the cultural strengths you have and the cultural needs of your businesses. If culture is hard to change, which it is, then strategy is too. Both take years to build; both take years to change. Don’t let culture eat strategy for breakfast. Have them feed each other.

Workplace by Facebook

Workplace by Facebook is a new collaborative platform for businesses who want to harness social media technology within the office environment.

Workplace can be used to communicate via groups, to chat with colleagues and offers the features of Facebook but in a business focused package. Workplace is designed to be easy and familiar to use so it looks very much like regular Facebook.

Workplace can effectively replace a firm’s intranet. The familiarity of the platform provides instant benefits in terms of user experience. Most people already know how to use Facebook. Since most employees can use the platform, businesses won’t have to spend as much time and resources on training people.

Workplace is completely separate from personal Facebook accounts, meaning information shared between employees is only accessible within the Workplace platform. Workplace is designed to work in a similar way to a corporate email account. Employees are issued with an account when they join the company and should they leave the firm, they will lose their account.

From a privacy perspective, employers can not use a Workplace account to access information on an employee's private Facebook profile. Networks are isolated and only company-wide, which means only co-workers can see the information other employees post in Workplace.

On the security front, Workplace relies on Facebook's own infrastructure and tools for threat detection to safeguard data. The system also follows third-party industry security standards.

Workplace features a News Feed that displays articles, updates or comments relevant to certain teams or, perhaps, to the entire company. A version of the Facebook Live service can be used to broadcast corporate communications, such as a presentation by the managing director.

Teams can communicate in real time using a version of Messenger. It is also possible to create private groups for brainstorms or discussions where users can share files, photographs, etc.

Budget 2017 - Tax & Rate Updates!

Corporate Tax Measures

The Chancellor announced that the Government is committed to continue to have the lowest corporate tax rate of the G20 major trading nations.  As already announced the corporation tax rate reduces to 19% from1 April 2017 and then to 17% from 1 April 2020.

The corporation tax rate for small and medium sized companies trading in Northern Ireland will be reduced so that such companies can compete with those in the Republic where the rate is 12.5%.

The Government is also keen to continue to encourage investment in research and development (R&D) and the Chancellor announced that the R&D tax credit claim procedure would be simplified.

Tax Free Childcare Scheme Starts 2017

The chancellor also announced that the new tax-free childcare scheme is due to start in 2017.

The scheme will provide up to £2,000 a year in childcare support for each child under 12 where the parents save in a special account. If they save £8,000 the government will top up the account with 20% to a total of £10,000 which can then be used to pay for childcare costs.

Business Rates Relief For Small Businesses

There has been much lobbying from the small business sector to reduce business rates. The Chancellor stated that 600,000 small businesses currently benefit from small business rates relief.

He also announced that no small business that is coming out of small business rates relief will pay more than £600 more in business rates this year than they did in 2016/17.

In order to support the licenced trade from April 2017, pubs with a rateable value up to £100,000 will be able to claim a £1,000 business rates discount for one year.

Advisory Fuel Rate For Company Cars

These are the suggested reimbursement rates for employees' private mileage using their company car from 1 March 2017.

Engine Size	Petrol	Diesel	LPG
1400cc or less	11p		7p
1600cc or less		9p
1401cc to 2000cc	14p		9p
1601 to 2000cc		11p
Over 2000cc	22p (21p)	13p	14p (13p)

Where there has been a change, the previous rate is shown in brackets.

You can continue to use the previous rates for up to 1 month from the date the new rates apply.

New Vat Limits

As mentioned earlier, the VAT registration limit increases by £2,000 to £85,000 from 1 April 2017. At the same time the de-registration limit increases to £83,000.

Contact us if you need more information or business help:
APJ Accountancy | ☎ 020 89310165 | ☏ 07900537459 | ✉ info@apjaccountancy.com