Non-executive appointments – Report Summary

Summary

Non-executive directors (NEDs) provide government departments and arm’s-length bodies with strategic leadership, scrutinising performance, promoting transparency and taking a long-term perspective. However, major issues remain with the appointments process which are taking too long to resolve. In particular, appointments take far longer than they should which is deterring candidates and posing a risk to the governance of government boards: on average, in 2022–23 appointments took over half a year—203 days to be precise—from the competition close date. The Cabinet Office’s Governance Code states that appointments should be completed within three months but only 7% of appointments met this expectation in 2022–23, while nine took more than a year to complete, with the longest taking more than 400 days.

The Cabinet Office is responsible for oversight of public appointments, but only monitors and tracks ‘regulated’ appointments—those appointments to bodies or posts listed in the relevant Order in Council (see paragraph 14)—of which there were 4,476 in post as of March 2022. Some regulated appointments are for NEDs, but not all. Many other types of appointment are also classed as regulated appointments, such as trustees, commissioners, advisers, chief inspectors, and adjudicators. The Cabinet Office does not know how many of those 4,476 were NEDs. Moreover, the Cabinet Office does not currently track unregulated appointments so it cannot say how many unregulated NEDs there are across government, how diverse they are, or how long they take to appoint.

Before 2023, the Cabinet Office’s only method of collecting data about regulated appointments was a manual exercise, requesting data from departments once a year. The Cabinet Office has recently introduced a new applicant tracking system and requires all departments to use it for regulated public appointments. This system should allow government to understand better where delays are occurring and help to improve its oversight of regulated appointments. However, the new application system is still in its early stages, and not all departments and arm’s-length bodies are using it as intended, so the Cabinet Office still does not have the data it needs. While the Cabinet Office expects some departments will also use the system for unregulated appointments—so allowing the Cabinet Office to start collecting some data on those appointments—the Cabinet Office does not currently require them to do so.

We still do not have confidence that the public appointments process is efficient, transparent and fair. The Cabinet Office does not publish clear information about NEDs or the panels which select them. It launched a diversity action plan in 2019, with the ambition for 50% of all public appointees to be female and 14% of yearly appointments to be from ethnic minority backgrounds by 2022. It did not meet these targets by 2022 and has no plans to put in place a new diversity action plan or updated targets. While government has sought to strengthen its outreach activities, it cannot yet demonstrate how effective these have been in recruiting the best candidates for NED roles.