When a board member accepts a new position on a board, it’s rare that the board member knows exactly what to do and how to do it. Active board members will get up to speed quickly on their own, but there’s no question that a strong orientation primes new board members for their duties. Regular training keeps them invested in staying active and fulfilling their roles on the board, in committees, and networking outside of board duties. Orientation and training creates opportunities for new members to get acquainted and begin networking with other board members, management, vendors, and employees.
When it comes to the culture of an organization, it’s hard to fool the public. A healthy public image is often a sign of good corporate governance. The aftermath of the bankruptcies of major entities such as Enron, WorldCom, and Tyco sent a fury through the financial industry. The shock of their demise sent plenty of financial advisors and consultants back to the board room to evaluate where it all went wrong. Congress moved swiftly to protect shareholders by requiring higher accountability of key board members by passing the Sarbanes-Oxley Act in 2002.
Board candidates that seek a position on the board of directors of nonprofit organizations are typically passionate about the organization that they want to serve. It’s important that all board members of nonprofit organizations understand the legal responsibilities that they hold relative to their positions on the board. Failing to fulfill their responsibilities according to the law may have dire consequences to the individual, as well as to the organization.
Your chief executive is leaving. No, not hypothetically. At some point, the CEO, executive director, or maybe even founder of your organization will move on to something new. In fact, according to BoardSource, 50% of nonprofit leaders expect to leave their positions within the next five years, yet only one-third of organizations have a succession plan. And even fewer have an executive director transition plan.
Boards take great care in appointing or hiring executives, chairmen, CEO’s and other people who serve in influential positions, as they should. As part of the selection process, they look for leadership qualities such as honesty, communication, commitment, and their ability to inspire progress and positivity. Those who vie for those positions put forth a strong resume and portfolio to positively impact the decision-making process. When it all works well, the new leader moves forward to fulfill the promise of his duties. But, what happens when a leader talks a good talk, but fails to perform according to expectations with no hope of improvement? The board may be able to oust a leader with a vote of no confidence, but that is not always the best course of action.
Last week a prospective client asked us how BoardEffect users typically measure organizational cost savings from using our product. This is a relatively common question, which isn’t surprising given that virtually all organizations today operate with budget constraints. But this frequent and seemingly simple request implies a range of related questions centered around calculating Return on Investment (ROI). In an effort to address this question completely but concisely, I’ve broken this into a two-part response. This first post articulates a way to think about and justify the general cost of implementing a board portal versus the most common alternatives. The ensuing second post will offer a framework for comparing the cost of commercial off-the-shelf software versus building one’s own custom board portal solution.
People that have a passion for a cause typically make good non-profit board members. That’s no surprise since they tend to know a lot about the organization already. What’s even better is that they bring a lot of their own knowledge and expertise about the organization’s purpose and network. More importantly, new board members often bring a contagious excitement with them to board meetings. Passionate new board members can breathe life into any nonprofit board. Board recruiters will do well to make sure new board members understand that serving on the board comes with important responsibilities and to help them understand what those responsibilities are, so that the new board member can plug into the board in the most helpful ways. Here are 10 duties that every board member should be pay attention to:
All heads typically turn toward executive directors when talk of “succession” reaches the board room, but they’re not the only nonprofit leaders who warrant transition attention. All of them do, in fact, yet organizations often lack preparedness for turnover at any level. Still, board of director succession planning is essential to good governance, as it sets the stage for board engagement and performance, not to mention effective leadership. And effective board leadership matters more than many think, as noted by ASAE and referenced by Social Venture Partners in Succession Planning for the Non-profit Board Chair:
The financial crisis of 2008 changed a lot of long-standing practices for non-profit boards and corporate boards. More than ever before, boards are rethinking and reviewing past practices to make sure that the organizations they represent are making progress, despite any financial instability. As part of the review, non-profit boards are weighing the pros and cons of term limits for board members. In evaluating this issue, non-profit boards are reviewing trends, surveys, and best practices.
The Latin meaning of the word quorum is derived from a word that means who. Commercial and non-profit entities enjoy a multitude of benefits when they form a board of directors. The main reason for organizations to form a board is to pool the talents of individual directors to make the best overall decisions about the current and future direction of the organization. That means that the demographic that constitutes the “who” of the decision-makers holds great significance for every organization. In not following quorum protocol, a few members may become too powerful, creating the risk that decisions may not benefit the good of the whole.