There is a D&O liability in every high-ranking executive position, and it is essential to recognize the potential for fault to avoid mistakes. Working as an executive director comes with much pressure and high expectations. Despite a lengthy interview process, you could find yourself unprepared for the role you take on. In a role inherently fraught with D&O liability concerns, a few tips for avoiding common mistakes could help your first 90 days go smoothly and without serious incidents.
Recognizing and Avoiding D&O Liability Mistakes
A mistake could cost you and the company thousands. Therefore, your D&O liability coverage is the first step in addressing this risk, provided you carry limits high enough to cover the primary concerns. Always ask about this coverage before you take a new position. You can also take additional steps to take to avoid common concerns.
Mistake 1: Ignoring the Relationship With the Board
As an executive director, spending time earning the board members’ trust is crucial, and you must understand the process. You could also find yourself obsessing over performance and focusing on results instead of prioritizing and building rapport in these critical relationships. If you have their trust, they are more likely to support tough decisions or remain patient with changes you make over time.
Mistake 2: Disregarding Your Executive Presence
The perception of your role is essential, and it goes beyond how your staff, the board, or donors look at you. Ultimately, the public perception of your professionalism and actions influences the perception of the organization’s brand. How you handle internal affairs also impacts the company culture.
Managers or shareholders who believe you are failing to execute your duties could create a problem and lead to legal action. While you can use Directors & Officers Insurance to help, avoiding questionable behaviors is best.
Mistake 3: Delegating the Primary Duties of Fundraising
If you are in a director or executive position, it’s your job to attract new investors or raise funds for your organization. Furthermore, if you are in a non-profit, establish fundraising as a priority. If you are seeking new investors or exploring new markets, start making connections and networking through board members or other industry leaders. Your involvement with the finances is another reason to keep your D&O liability policy current.
Mistake 4: Misunderstanding the Company Culture
A good leader inspires and motivates, but you must understand the culture and dynamics of your organization so that you can reach the mark. It’s essential to get to know integral members of the leadership team and understand their roles. Learn the organization’s history and determine how to improve and support it.
Mistake 5: Delaying Important Hiring or Firing Decisions
You may need to evaluate the company’s staffing needs in your first few months. Your stakeholders and the board will want results, so you can’t delay employment decisions. Expect excellence and make hiring or firing decisions to support your position.
Protect Your Role With D&O Liability Coverage
A little diligence goes a long way in proactively avoiding these mistakes. Fortunately, you have a safety net in D&O liability insurance should a problem lead to litigation.
About Haughn & Associates
Founded by Michael Haughn in 1986, Haughn & Associates is a full-service, family-owned, independent insurance agency based out of Dublin, Ohio. H&A strives to provide the best possible price and unique insurance solutions across a myriad of industries, including construction, IT, Habitation & Commercial Property, Agriculture, and Engineering. Devoted to providing the best of business insurance, life and disability insurance, personal insurance, employee benefits, and bonds, H&A is proof that success lies in long-standing client relations and satisfaction. To learn more about how H&A can be of service to you, contact us at (877) 802-2278.
