Rewiring The Board Room - Curiosity as a Governance Capability
The Role of the Non-Executive Director – 22 years on from the Higgs Report
Do you remember life in 2003? It’s easy to forget just how different the world was then. The ‘Fall of the Berlin Wall’ had only occurred 14 years earlier, many of the former countries of the USSR were at embryonic stages in terms of developing their democratic and market systems; the physical and phycological effects of the September 11th tragedy were at the front of societal and geopolitics. China’s GDP was less than one thousandth of its current size, only 1% of retail sales were online, the I-Phone hadn’t been invented and those that spoke about Climate change were focused on subjects such as ‘Acid Rain’!
It was against this landscape that the Higgs Review which laid the foundations for much of modern UK corporate governance was being performed. The Higgs Review defined the role, composition, and independence of non-executive directors (NEDs) and was in response to high-profile corporate failures (eg: Equitable Life and Marconi).
It is fair to say that there have been huge changes in societal, geopolitical, economic and environmental considerations since then.
It is not unreasonable given those changes more than twenty years after the Higgs Review first defined the modern role of the non-executive director, so ask “Is the NED role still fit for purpose in today’s corporate environment?”
This is the key question that Institute of Directors (IoD) has returned to in their “NEDs reimagined business paper” from the 2025 Commission that undertook a combination of survey research, academic review, and engagement with directors, investors, and governance experts to assess whether NEDs are truly adding value and how they can be better supported.
The overall conclusion of the paper is that the core Higgs principles remains relevant, however the Commission does argue that boards must now evolve from a model of periodic, compliance-driven oversight to one of active, informed, and adaptive stewardship—calling for nothing less than a “rewiring of the boardroom” to reflect digital transformation, sustainability pressures, geopolitical uncertainty, and rising expectations of board effectiveness.
This concept of ‘active, informed, and adaptive stewardship’ is totally compatible with the UK Corporate Governance Code’s Section 1 (Board Leadership and Company Purpose), which emphasises that boards should promote long-term sustainable success, establish purpose and values, and ensure that culture aligns with strategy — not merely assure compliance.
Curiosity and engagement as foundations of board effectiveness
One of the key observations I see the IoD Commission focusing on is “Board Effectiveness”, identifying that ‘the best NEDs’ are distinguished from ‘the rest’ by curiosity rather than technical brilliance.
Under its Culture theme, Finding 6 states that “NEDs need to be more engaged and curious”. The Commission concludes that the best NEDs are distinguished not by technical brilliance alone, but by a strong desire to understand the business, intellectual energy, and open-minded enquiry.
It is interesting that the Commission’s evidence suggested that curiosity, engagement, and open-mindedness are the attributes that separate effective NEDs from ineffective ones; and that such behaviours are at least as important.
This curiosity and engagement has consistency with both the Wates Framework Principle 3 (Director Responsibilities), which requires directors to promote the success of the company through effective oversight and informed judgement, and the UK Corporate Governance Code’s expectation that directors should “have sufficient time to meet their board responsibilities and make informed decisions”.
When I’m working with CEOs and Boards I summarise two of the key roles of an effective NED to be:
- To enable the Executive to be the best they possibly can be, and
- To hold them to account when they fail to achieve this.
Clearly to enable either of these to occur, NEDs need to be ‘curious’ about the organisation, and those that lead it.
Governing complexity and detecting weak signals
I would suggest that modern governance is no longer about supervising stable systems. It is about governing complex, adaptive organisations operating in volatile environments and managing the way around ambiguity.
In such settings, the biggest risks rarely announce themselves neatly on dashboards. They emerge at the edges — in culture, technology, stakeholder sentiment, and weak strategic signals.
The Commission notes that engaged and curious NEDs are better placed to detect these signals and test management narratives before risks move to genuine impacts.
This reflects the intent of Wates Principle 4 (Opportunity and Risk) and the UK Code’s Section 4 (Audit, Risk and Internal Control), both of which stress that boards should actively identify and manage emerging risks and opportunities, rather than relying solely on formal reporting.
Curiosity is what allows NEDs to see those signals – an early warning system!
Challenge with emotional intelligence
I also found it interesting to see that the report also reframes challenge that it is equally explicit about how challenge should be exercised. Finding 8 concludes that NEDs should hold executives to account, but do so with emotional intelligence. Constructive challenge remains essential, though it is most effective alongside with emotional intelligence and trust. Chairs are encouraged to focus on collaboration over confrontation, and NEDs should not define their role solely in terms of opposition.
This is a subtle but important shift which we also see strongly in practice with boards that prize challenge without curiosity often generating heat but little insight. Boards that treasure and develop curiosity as a skill, create psychological safety, better information flow, and more thoughtful decision-making.
This directly supports both the UK Code’s emphasis on board culture and relationships and Wates Principle 1 (Purpose and Leadership), which places responsibility on boards to set the tone from the top and promote effective decision-making.
Presence in the business and engaged independence
The Commission also emphasises the need for NEDs to be more present in the business — visible to stakeholders, engaged beyond formal meetings, and actively building understanding of culture, strategy, and risk.
Specifically finding 7 recommends that “NEDs need to be more present in the business” — visible to stakeholders, engaged beyond formal meetings, and actively building understanding of culture, strategy and risk.
This connects directly to Finding 1 under Board Composition, which urges boards to conceive independence less narrowly, focusing on independence of mind and cognitive diversity, not distance alone.
This is a subtle but important redefinition of independence. Independence no longer means distance and certainly should never have been considered to be detachment. It means engaged objectivity.
This is also compatible with the UK Corporate Governance Code’s Section 3 (Composition, Succession and Evaluation), which emphasises board balance, independence of thought and effective evaluation, and with the Wates Principle 2 (Board Composition), which stresses the importance of appropriate balance, diversity and independence to enable effective decision-making.
Cognitive diversity becomes a governance asset, not simply a diversity metric.
Skills, learning and the intensity of the modern NED role
The IoD Commission also addresses capability under Finding 4, it concludes that NEDs must have the requisite skills, experience and mindset, and demonstrate a continued appetite to learn.
The reality is that the role of an effective NED has become significantly more demanding — encompassing among others - cyber risk, digital transformation, ESG, geopolitics and regulatory complexity.
This expectation is consistent with the UK Corporate Governance Code’s requirement that boards ensure “appointments are made on merit” and that directors “continually update their skills and knowledge”, and Wates Principle 5 (Remuneration), which links capability, accountability and reward.
Behavioural competence — listening, questioning, learning — are now as critical as technical expertise.
Time, over-boarding and remuneration
Finally, the Commission addresses an uncomfortable structural issue. Finding 12, identifies that NED remuneration and role design often fail to reflect the complexity, time demands and accountability of the modern role.
The implication is clear: effective governance requires time, presence and focus. Over-boarding weakens curiosity, engagement and judgement.
This supports both the UK Code’s provisions on time commitment and conflicts, and Wates Principle 5, both of which stress that remuneration policies should promote long-term sustainable success and attract individuals with the capability and capacity to govern effectively.
Organisations need more from their boards. NEDs need the time — and the incentives — to deliver it.
The overall message of the IoD paper is that board effectiveness increasingly depends upon behavioural capabilities: listening, questioning, learning, and relationship-building. To quote a from a song by ‘Bananarama’ – “It ain’t what you do, it’s the way that you do it – AND that’s what gets results”!
Governance in the next decade will be less about positional authority and more about intellectual and relational leadership.
The lessons for board directors and for those recruiting new NEDs are as follows:
1) Cognitive diversity is an essential requirement for any effective board and needs to be a key element of diversity and inclusion. It brings a clearer lens to information gathering, discussions and decision making.
2) Organisations need more from their boards in order to manage their way through volatility and ambiguity; it is even more important than ever that NEDs ensure they have the time to effectively perform their roles. They need to spend more time experiencing the organisation and need to be rewarded accordingly. Any NED that seeks to bring serious value to their organisation needs to ensure that they limit the number of NED roles to enable this and organisations when recruiting NEDs need to have ‘over-boarding’ at the front of their considerations.
Curiosity, it turns out, is not a soft skill. It is a core governance capability.
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