This article breaks down how Wiserfunding evaluates the management experience of an entity's board.
In assessing the risk profile of a company, the qualities and track record of its management team may provide key insights. We evaluate the management experience of a company's board of directors using a scoring system. This method ensures an objective and thorough analysis by considering the following criteria for the company's directors.
Age: Reflects the maturity and potential for long-term strategic thinking.
Current and Past Appointments: Indicates the breadth and depth of professional expertise and leadership roles.
Tenure: Demonstrates stability and continuity within the company.
Geographic Reach: Shows the ability to navigate and manage operations across different regions and markets.
The board of directors is collectively assigned a score based on the above criteria. However, certain negative factors, such as involvement in inactive companies, can detract from their score.
The total combined score for the board determines the overall management experience rating, categorised as follows:
HIGH; Indicates a highly experienced and stable management team, which is a positive indicator of reduced risk.
MEDIUM; Suggests a competent management team with a mix of strengths and areas for improvement.
LOW; Points to potential vulnerabilities in the management team, highlighting a higher risk profile.
This structured approach allows for a nuanced understanding of the management experience and its potential impact on the company's overall risk.
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