ELI5: Explain Like I'm 5

Non-executive director

Imagine that a company is like a playground. There are some people who are in charge of making the rules and making sure everything is running smoothly, and those people are like the teachers. But there are also other people who come in to the playground sometimes and help out, but they don't make the big decisions or tell anybody what to do. Those people are like the parents or grandparents who come to visit sometimes.

In a company, the people who are like the teachers are called "executives." They are the ones who make the big decisions about how the company should be run and what it should do. But sometimes, they ask other people to come and help out too. Those people are called "non-executive directors." They don't work at the company all the time, but they are still important because they can bring new ideas and help the executives make good decisions.

For example, imagine that the executives of a company are trying to decide whether or not to build a new factory. They might ask some non-executive directors to come and talk to them about it. The non-executive directors might have experience building factories in other places, or they might know something about the environment or the community where the factory would be built. This would help the executives make a good decision about whether or not to build the new factory, and how to go about it if they do.

So in summary, a non-executive director is like a helper or a visitor who comes to a company sometimes to give advice and help make good decisions. They don't have to follow all the rules of the company like the executives do, but they are still very important.