How to Structure an Effective Pre-IPO Board in the UK

Portfolio Company LeadershipBoard and CEO AdvisoryBoard Director and Chair Search
Article Icon Article
+ 6 authors
November 22, 2022
7 min read
Portfolio Company LeadershipBoard and CEO AdvisoryBoard Director and Chair Search
Executive Summary
Here, we identify the key components for delivering a successful, timely and value enhancing board for IPO.
rra-asset-image-1332138983.jpg

 

Read the study in full here

Preparing for an IPO is a challenge. Getting a well-constructed and value-enhancing board in place requires thought and planning. The markets remain challenging for companies working towards IPO - now may be a good time for those businesses to get ahead of the game and start addressing their board requirements.

Russell Reynolds Associates has an extensive track record in supporting and advising on building boards for IPO, including helping private capital firms prepare portfolio companies for listing on indices around the world. In the first of a Russell Reynolds’ thought leadership series on building pre-IPO boards, we focus our attention on the UK, drawing on our experience and analysis of recently listed boards to identify the key components of building a successful board: 

Creating value with the right board 

  • Balancing listing rules, corporate governance best practices and the commercial and strategic needs of the business to create a well-composed board that will enhance value at IPO and guide the organisation to sustained success as a listed business. 
  • Navigating the UK’s “comply or explain” approach to corporate governance and demonstrating a pathway to best practice.

Managing the board build

  • The role of advisors in planning the build, establishing alignment amongst stakeholders and maintaining pace.
  • Prioritising keystone roles, understanding the technical experience requirements. 
  • Securing the highest quality board directors and engaging them effectively.

Setting expectations: ambition and pragmatism

  • The appeal of pre-IPO boards for candidates, and the shifting approach to pre-IPO compensation.
  • Balancing the ambitions of owners for high profile, value enhancing board members with the longer term needs of the listed entity. 

Completing the puzzle

As with a jigsaw puzzle, the complexity and the time taken to assemble the right board will depend on the number of pieces in play. The greater the clarity on the overall picture and the component parts, the easier it will be to assemble. Time taken to prepare, understand the process and timing, align expectations, debate the priorities and define key appointments, and establish stakeholder engagement and communication is time well spent. Balancing the intermediary steps while keeping sight of the longer term requirements and the bigger picture requires effort. The resulting well-constructed board will support the IPO equity story and be a critical factor in the success of a newly public company.

 

 

 

rra-asset-image-1332138983.jpg

Read the study in full here

 

Authors

Helen Metcalfe is a senior member of the firm’s board & CEO Advisory Partners, specialising in chair, chief executive and non-executive director appointments and board advisory work.

Emily Taylor co-leads the global Private Equity Practice for Russell Reynolds Associates, working closely with investment teams, advising on chair and board appointments.

Laura Sanderson leads Russell Reynolds Associates’ operations in the UK and oversees the firm’s board & CEO Advisory Partners team throughout Europe.

Julia Budd is a senior member of the firm’s board & CEO Advisory Partners, specialising in chair, CEO and non-executive director searches, as well as board succession planning. Julia advises clients across industries, from FTSE 100 boards to smaller companies which are, or are poised to become, leaders in their own markets.

Rhys Grossman co-leads the Consumer Sector and Consumer Digital & Media Practice for Russell Reynolds Associates, working closely with publicly listed, private equity and venture capital firms to recruit transformative leaders who understand the confluence of technology and business to spur future growth.

Luke Meynell co-leads the firm’s board & CEO Advisory Partners, as well as leading the practice in the UK. He specializes in working with FTSE clients or equivalent organizations to deliver complex chief executive and chair succession projects, as well as other key board appointments, such as non-executive director or CFO roles. Luke is based in London.

Agnes Greaves co-leads the firm’s Core & Growth Technology practice globally and the Consumer Digital & Media practice in Europe. She focuses on board and senior management appointments, advising both established market leaders and investor-backed clients on optimal organisational design and how to attract and retain high-impact and transformative leaders.

Emma Combe is a member of the firm’s board & CEO Advisory Partners Sector. Based in London, Emma excels at identifying board chairs, CEOs, and executive and non-executive directors for listed, private equity and family-owned businesses.

Emily O’Shea specialises in chair, CEO and non-executive director appointments across a range of industries with a particular focus on healthcare, life sciences and organizations underpinned by innovation and R&D.