Transcript Characteristics of an Effective Nonprofit Board of Directors

Effective Governance on a
Nonprofit Board of Directors
William West
Graduate Assistant
University of Georgia
May 2009
Board of Directors 101
Roles and Responsibilities
1. Determine and periodically review organization’s
mission
2. Select and oversee the Executive Director
3. Ensure adequate resources
4. Provide oversight of income and expenses
5. Ensure legal and ethical integrity
6. Set and implement strategic goals
7. Enhance the organization’s reputation in the
community
8. Continually monitor and improve Board performance
Questions to Consider
• To what extent do you actually fulfill these roles
and responsibilities?
• How does your internal environment hinder
you from fulfilling your duty as a member of the
Board? How does it encourage you?
• How does your external environment hinder
you? How does it encourage you?
Barriers to Board Effectiveness
• Temptation to micro-management
▫ A barrier because…
 Board is charged with overseeing the EXECUTIVE, who, in turn, manages his/her
staff
 Oftentimes results in wasting time on trivial matters
• Ineffective nominating committee
▫ Must be fine-tuned because…
 Nominating committee determines the future make-up of the board of directors
• No plan for rotation
▫ A barrier because…
 Limits opportunities for a real change
▫ Why needed? New members can help promote creativity and innovation in
decision-making
• Failure to remove unproductive members
▫ A barrier because…
 Prevents board from fully serving its purpose and fulfilling organizational mission
▫ Possible Solution: Must have system for evaluating board performance and
making recommendations for future board service
MORE
Barriers to Board Effectiveness
• Too small
▫
A barrier because…
 Must have enough individuals to fulfill the multiple responsibilities and competencies of a board
of directors
▫
Possible solution: Recommended numbers fall anywhere from 11 to 21
• Lack of functioning committee structure
▫
A barrier because…
 Most of the work that supports and implements major board decisions are done in committees
• No strategic plan
▫
A barrier because…
 Board members often spend too much time talking about issues that are of little importance
because there’s no real direction
 Results in a lack of long-range development plan that will help the organization prepare and
thrive in the future
• No plan for orientation or training of new and old members
▫
A barrier because…
 New members must be carefully joined so as to create a well-functioning TEAM
 Training is essential for growth and adapting to the ever-changing environment
Activity: Overcoming Barriers
1. Everyone will be given a post-it with one of the
eight barriers (try not to look at it!)
2. Pair up with another person in the room and
have them place the post-it on your back
3. Without overtly stating which barrier it is, one
person should begin offering solutions to their
partner’s problem and allow them to guess
which one it is
4. Switch roles
Activity Questions
• Which barriers were the most difficult to find
solutions for? Why?
• How did not knowing what your own issue was
affect your ability to communicate with your
partner?
• What solutions did you come up with?
• Which of the barriers – if any – are present in
your organization?
Barriers No More
In order to overcome these barriers, board
members must develop and nurture valuable skills
in the following areas:
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Contextual
Strategic
Analytical
Political
Interpersonal
Educational
Keep Context in Perspective
• Understand and use the organization’s culture,
norms, and values
• Success is…
▫ Effectively utilizing distinctive characteristics of
board members and the organizational culture
and environment
▫ Relying on the organization’s mission, values, and
traditions in decision-making
▫ Exemplifying and reinforcing organization’s core
values
Diversify for Success
• A Board of Directors should contain members with unique
talents, skills, interests, experiences, and social backgrounds
• Such diversity is more likely to produce new, innovative ideas
and affect the organizational environment for the better
• To overcome barriers…
▫ Implement term limits
▫ Create a streamlined process for removing unproductive
board members
▫ Build a requirement for diversity into bylaws
Make Strategic Decisions
• Envision and shape the organization’s direction
and devise a strategic approach for the future
• Success is…
▫ Cultivating procedures that sharpen organization’s
priorities
 Show concern for most important and long-ranged
issues rather than more trivial matters
▫ Paying special attention to strategic decisions
▫ Anticipating and resolving potential problems
▫ Setting priorities and sticking to them
Stay in Touch
• Attempt to stay in tune with the happenings of the
organization and other board members
• Knowledge is a key characteristic of effective board
governance, of both the internal AND external influences
• Show a sincere concern for the issues affecting the
organization and gladly accept the responsibilities of
serving as a member of the Board of Directors
• To overcome barriers…
▫ Create a Strategic Plan
▫ Create and utilize job descriptions
▫ Consistently communicate with one another
 Utilize new, innovative methods wherever practical
Create your own Team Building Activity
• Scenario:
▫ You’re the Executive Director of a nonprofit
organization and you’re having trouble getting your
board to effectively communicate with one another.
Your task is to create an activity that will help
encourage and facilitate discussion among the board
members in a fun, creative way.
• Divide into small groups
• You have 15-20 minutes to come up with a
challenging activity
• Try to create an activity that is better than the
others!
• Present your ideas to the rest of the group
Take an Analytical Approach
• Recognize the complexities and subtleties in the issues you’re
facing
• Success is..
▫ Seeking out and drawing on multiple perspectives
 Diversity is still important!
▫ Approaching problems from a broad organizational outlook
▫ Tolerating ambiguity
▫ Recognizing that there may not be a perfect solution
• To overcome barriers…
▫ Know your own role and responsibilities
▫ Remain aware of the roles and responsibilities of key
constituencies (staff, other board members, volunteers, etc.)
▫ Be patient!
Be Political
but not like most politicians
• Develop and maintain open, two-way relationships with
key constituencies
• Success is…
▫ Consulting often and communicating, listening, and
understanding the concerns of stakeholders
▫ Minimizing conflicts and win/lose situations
▫ Respecting the integrity of the governance process and the
roles/responsibilities of others
• Politician and Effective: an oxymoron?
▫ Name an especially effective politician (whether you agree with him/her or not)
▫ What makes him/her successful?
▫ How can these characteristics be applied to a Board of
Directors?
Interpersonal Skills:
There is No Substitute
• Develop as a group and attend to the collective
well-being and sense of cohesion
• Success is…
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Creating and sustaining a sense of inclusiveness
Settling on goals for the group
Recognizing their achievements
Encouraging leadership and teamwork
• Don’t forget: The board of directors is a team of
individuals working toward a mission
Trust One Another
• In order to communicate effectively and more
willingly accept ambiguity, board members must
have a mutual respect for one another
• Maintain a productive working relationship with
one another
• Be sensitive to the unique perspectives of others
and LISTEN
• TRUST BUILDING ACTIVITY
We Don’t Need No Education
actually you do…
• Ensure that all members are well informed about the
organization, its constituencies and their roles
• Success is…
▫ Creating opportunities for own education and development
▫ Regularly seeking out information and feedback about
performance
▫ Periodically pausing for self-reflection
• To overcome barriers…
▫ Have a formal orientation for new board members
▫ Provide opportunities for training and/or further education
▫ Allow informal discussion of ways to improve board
performance before/after board meetings
Look in the Mirror
• What are the greatest strengths of your board?
• In what areas is the most improvement needed?
• Have you attempted to make changes in the
past? If so, how?
• What actions can you take to make sure that
such improvements are implemented?
Case Study
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Pinehurst
What are some of the strengths of this board?
What are some of its greatest weaknesses?
What are some of the potential positive effects of
Beth’s proposed plan? What are the adverse
effects?
• How should the Board Chair respond to possible
changes?
• What do you think Beth should do?
An Effective Board of Directors…
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Keeps context in perspective
Is composed of a diverse group of individuals
Makes strategic decisions
Consistently communicates with one another
Takes an analytical approach
Develops and maintains two-way relationships
Attends to the needs of the group
Ensures that all members are well-informed
Questions?
Resources
• Holland, T. & Ritvo, R. (2008). Nonprofit
Organizations: Principles and Practices. New
York: Columbia University Press.