Exploring Social Networks of Non-executive Directors in Australian Third Sector Organisations.

The appointment of a member to a board of directors in the third sector is a largely unexplained and unquestioned process. Generally, non-executive board members are unpaid and are often appointed via membership of a social network, without any formal recruitment or selection processes. These same board members also play an important and responsible role in the governance and sustainability of socially responsible third sector organisations. Hence, there is a real tension between the seemingly informal appointment process and the formal responsibility of such a position. This paper aims to shed light on the appointment processes to Australian boards of directors in non-executive positions in the third sector. There is little critique of this 'idealised' rationalised model, which is the dominant model used to describe the appointment process in the human resource management literature (Legge 1995). In fact, critique of appointments made using such social networks are rarely discussed even when those networks are physically mapped by the director interlock researchers (Alexander 2003). Appointment processes used in board-level appointments are less well covered in the literature, other than in this rationalist frame (Moodie 2001). A questionnaire collected demographic data from 65 board members from a diverse group of third sector organisations. Interviews followed with eight of those board members. Thematic analysis from the questionnaire and interviews allowed for the emergence of themes about perceptions of board membership appointment. boards. Keywords Networks; directors; third sector; appointment Introduction This paper explores findings on the social network appointment processes for non-executive directors on Australian third sector organisation (TSO) boards. Both overt and covert appointment processes for non-executive board members within the third sector are considered. Overt appointment processes include practices such as direct advertising - for example, via recruitment services such as the Australian Institute of Company Directors and the Pathways annual director recruitment drive, or executive recruitment firms (AICD 2012). Those interested in the roles, and deemed capable of meeting the criteria described in the advertisements, are able to apply for these positions through online application portals. Covert appointment processes are those which are less transparent (Searle 2003). These may include practices such as a direct approach from company chairpersons or other personal recommendations via social networks. Contacting 'suitable' applicants to ensure they apply for the position may be one way that director networks can operate to filter access to the role of non-executive director [ABSTRACT FROM AUTHOR]