Nonprofit Boards are either seen as a decisive force to ensure accountability of nonprofit organisations or, as problematic institution not contributing to the basic business of the nonprofit. There seems to be a general perception that non-performing boards are the rule, and not the exception. The basis for this perception depends on who you speak to:
- Staff ask “what is the board doing”
- Management complains that board are not fulfilling their duties or are overstepping their boundaries
- Funders and Compliance bodies complain that board are not exercising their oversight duties
- Boards complain that they are merely rubber stamps
- Communities and staff complain that board members merely serve to pad their CV’s
And the list goes on.
The kind of problems that is raised regarding Boards include:
- Purpose: It seems inconceivable that there can still be uncertainty regarding the purpose of a board of a nonprofit. The volume of literature on this topic is extensive and abundant. There also seems to be a basic approach of training our way out of board problems. The main functions for the board can be summarised as:
- Set the organisation’s mission and organisational strategy (both on near-term and long-term challenges and opportunities), and modify both as needed. Ensure effective organisational planning
- Ensuring prudent use and conserving of all assets – fund, property, people, and goodwill. Manage resources effectively
- Evaluate and help managing risk. Ensure that applicable laws are obeyed and acting in accordance with ethical practices
- Mentor Director or CEO – select executive staff through an appropriate process, evaluate, ongoing support and guidance to the executive, Monitor performance, and hold accountable for performance (and if required replace)
- Enhance the organisations public image. Advocating for the organisation and building support in the wider community and related change systems such as government departments, funders etc. Both linking the organisation to the wider community, but also being the bulwark against “attacks”
- Assess own (board’s) performance
- Performance: While legislation and regulations ensure that most nonprofits have boards and gives some indication on the purpose, this does not seem to address the perceived lack of performance of boards by the various parties. The reason for this can most often be linked to the fact that many board members, executives and organisations as a whole, do not understand or accept the purpose of the board.
- If your board must do all the tasks as indicate above, why is the organisation not ensuring that they compose the board of individuals with the skills, resources, diversity, and dedication to address these aspects? Board composition is not an abstract exercise – it is about difficult and grueling process of finding and adding the right board members
- The roles and responsibilities, and by implication performance, of the nonprofit boards seems to create confusion. Why then, after recruiting you board according to required skills, not assign responsibilities according to these skills, and evaluate performance according to these skills. Why not extend organisational processes such as clear and measurable job descriptions, and performance appraisals to the Board.
- Accept that not all board meetings are going to produce “game-changer” decisions and inputs. A large portion of the “important” work that the board does can be periodic or occasional – this needs to be differentiated from the routine work that has to done on more regular basis. If not, the possibility of inflating routine issues to strategy level is real – or alternatively neglecting the strategic focus of the Board.
- nonprofits operational staff have quite a few regular (monthly) meetings relating to various issues – staff meetings, management meetings, project meetings, operational meetings, financial meetings etc. The assumption is that these operational meetings and decisions are contributing to the overall strategic mission and plan of the organisation. (If not – what is the purpose?). It is the function of the Executive Director or CEO to translate – for both the board and the staff- the operational matters to strategic activities, and ensure the flow of the information between the structures. In short – if you have something to discuss internally in the organisation, you should have a higher level “something” to convey to the board. If the CEO has mastered the skills to communicate to the Board an integrated and functional account that presents and decodes the organisations situation, Boards will be able to discuss the strategic impact (and also limit straying into operational matters and discussions)
The most important rule for all parties to realize is that the board as a whole, as well as individual members, without doing anything, confer legitimacy to the organisation. Furthermore, there may many laws, guidelines, and literature that confers legitimacy to the Board (which transfer the legitimacy to the organisation) – however no amount of laws or guidelines can compel the board to be high-performing. This is a goal that board, the executive, and the organisation as a whole must strive towards collectively.
A committed board member actively builds relationships for the organisation to succeed, is expressively linked to the organisation, and works on the highest skill level for the organisation - and actively work to improve their own and their organisations performance. A skilled CEO does not see the board as a rubber stamp or “big brother”, but as partner to reach the strategic mission of the organisation.
Both a committed board member, and a skilled CEO do not waste any time discussing the performance of board, if they have not reached shared clarity on the purpose of their board. A knowledgeable board and CEO do not spend time on what is operational and what is strategic, as all are clear on strategic vision of, and risk management in the organisation - and what strategic and operational decisions have been taken (in advance) to reach strategic vision and avert/limit risks.
The most important relationship in a nonprofit is that of the CEO and the Board (in particular the Chairperson). It this relationship is characterized by lack of trust, lack of meaningful communication and an ineffective division of labour, is does not bode well for the organisation. Organisations need to be clear on
- Whether the purpose and performance of the board should be thestarting discussion point,
- Or should be rather discuss the lack of performance and lack of clarity on purpose as the result or consequence of an unconstructive relationship.
Pauline Roux is Managing Partner at the Organisational Puzzle http://www.organisationalpuzzles.co.za/