There are three times more non-executive directors (NEDs) applying for each available NED role within unlisted companies than three years ago, according to executive search firm Otravida, part of the Rethink Group.

Otravida says a reduction in available NED roles has contributed to an increase in job-hunting NEDs, as companies have reduced their use of NEDS to cut costs.

Michael Aitchison, principal consultant at Otravida, says: “The recession means that many unlisted companies have scaled back their ambitious growth plans, with fewer looking to raise large amounts of equity. That means less demand for NEDs to guide them through that growth trajectory and less demand for the NEDs needed to explicitly attract investors or to help get the business investment ready.” 

Aitchison says the reduction in the use of NEDs by private equity backed companies is far lower than among other unlisted companies. “The use of NEDs is central to way that PE [private equity] houses work, so they are far less likely to reduce their use of NEDs to cut costs.”

And despite an increase in the number of qualified NEDs available, pay “remains high” for NEDs at unlisted companies, says Aitchison, at between £15,000 and £30,000 per year for just two to four days work a month.