Board Governance Surrounding Nonprofit Organizations

by: Smith and Howard

December 2, 2016

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Nonprofit organizations rely on their board members for a variety of reasons. Board members support the mission of their affiliated organization in many ways, but they also play two key – and somewhat different – roles: support and governance. Michela Perrone, PhD, President of MMP Associates believes when it comes to support and governance board members must wear two different hats.

When they wear the governance hat they have full authority to make the governance decisions.  When they wear the support hat the CEO/Executive Director has the authority to make operational and management decisions.   

Michela opened our October 2016 Nonprofit Workshop by asking the audience to speak with individuals at their table and to come up with a list of questions they had regarding nonprofit boards. Below are three topics Michela and the audience discussed.  

1. How to engage your board members 

Engaging board members can be difficult. Michela recommended having board members complete an individual board engagement plan documenting what they can and cannot do during the upcoming year.  The plan is then collected and reviewed by a board committee and can be used by board members to hold each other accountable and set realistic expectations.

2. Pros of an advisory group 

The nonprofit world is beginning to see an increase in non-fiduciary bodies. Non-fiduciary bodies serve as advisors, honorees or other purposes to the board without the legal and fiduciary obligations of the board of directors. Individuals that comprise these non-fiduciary bodies often include: past board members, past presidents, esteemed leaders, past staff leaders.  Advisory groups do not have formal authority to govern an organization. Instead of attending board meetings, these individuals participate by providing board members with reports and update board members and staff with appropriate information. An additional benefit to having these groups is that they typically bring important perspectives both from the community and from their past involvement.  Some of these groups are also formed to support the fund raising efforts of the organization.

3. How to get an ineffectual board member off the board 

Ineffectual board members do exist and so do frustrated board members. As board sizes decline, who serves on the board is important. Michela addressed this question with a simple solution – terms limits. If a board is struggling to make members more effective, Michela recommended implementing terms limits.  As each of the terms of a board member ends, a board committee evaluates each member’s performance and makes recommendations to the board as to the reelection of the board members. 

For example, each member customarily has a six year tenure on the board.  The six years are divided into three terms: the first is a one year term, the second a two year term and the third a three year term. This provides opportunities for the board, and for the individual board member, to evaluate the engagement and effectiveness of the board member and act accordingly.  

The October workshop was the latest in a series of educational sessions provided by Smith and Howard’s nonprofit group at no charge to the nonprofit community. To learn more about the ways Smith and Howard helps nonprofits grow and fulfill their missions, use the contact form below. To receive invitations to future nonprofit workshops, emails us here.

To learn more about Dr. Perrone and access articles and materials, visit her website here.

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