The detail of the Board of Directors, their background, their longevity with the company and their other board directorships are valuable tools.

Regulations governing their responsibilities and behavior of directors of public companies, are extremely strict.

There have been many discussions about the level of remuneration of directors of public companies. Remuneration varies significantly by company and there are a variety of arguments for and against how much directors get paid. However it should be recognised that accepting a position as a public company director has significant potential liabilities and is strongly regulated.

Therefore if a company has a well credentialed board of directors it can be an indication of a very positive element in the company. Well qualified company directors will not accept joining boards of companies until they have done significant due diligence.

Relative to the Board of Directors it is constructive to look at the shareholdings of the board of directors. In some cases the directors own extremely small amounts of stock in what can be an extremely large company.

While this may indicate to some people a lack of confidence in the company, it is often more a fact of flexibility by these directors. Directors can only trade, buy or sell shares within very limited windows, and one of the challenges for directors is that if they, for personal or other reasons wish to sell shares, the market can interpret this as a negative for the company, when it is in fact not.

Hence many directors decide to avoid the dangers of owning shares in the company they are on the board of. General advice is that, it is better that directors do not own large shareholdings as then they do not have a conflict of interest when deciding what is done within the company.