Sheedy joined the Essendon board in October, 2020 with the express role of helping the club rebuild its football program.
During his time as director, Sheedy has been involved in helping implement a crucial external review as well as appointing a new senior coach, chief executive and general manager of football.
The Bombers (11-9-1) currently sit 10th on the ladder, and will need to win their final two games to have a chance of making the finals.
Essendon haven't won a final since 2004, a rot coach Brad Scott is desperate to end.
"The club is in excellent hands with president David Barham and the current board," Sheedy said in a statement.
"Vice president Andrew Welsh is doing an excellent job, looking after the football aspects from a board point of view.
"I was happy to step up and help when asked by Paul Brasher in 2020, and I have always done everything that I can to help this club. This will never stop.
"I am very confident under the leadership of CEO Craig Vozzo and coach Brad Scott that we are on the road to success.
"We have returned to being a football club where our ultimate focus is on winning football games and making our members and supporters proud with everything we do.
"Essendon means so much to so many people and with the current stability and renewed focus at the football club, we have the right foundations for sustainable success."
Sheedy was coach of Essendon for 27 years from 1981-2007, guiding the club to four flags during that period.
He was also the inaugural coach and a former director of Greater Western Sydney.
Sheedy's other contributions to the AFL industry include creating the iconic Anzac Day and Dreamtime matches, enhancing the AFL Coaches' Association and establishing the AFL Sports Ready Program.
The 76-year-old is an Essendon life member and Hall of Fame Legend, an AFL and Richmond life member and an AFL Hall of Fame Legend.
Meanwhile, Essendon assistant Daniel Giansiracusa has become the latest person to pull out of the running for the West Coast coaching job.
Giansiracusa wants to remain in Victoria for family reasons.
He joins Dean Cox, Josh Carr, Nathan Buckley, Jaymie Graham and Ash Hansen as others to have ruled themselves out of the Eagles role.
Current interim coach Jarrad Schofield is now the hot favourite to land the role full-time, especially after back-to-back wins over Gold Coast and North Melbourne.
