I have outlined board frameworks elsewhere and this blog is a more practical companion.
While there are literally dozens of books, websites and blogs devoted solely to the topic of nonprofit boards it is still a common phenomenon for nonprofits to struggle to identify the strategic composition and functioning of their board of directors. What kind of people should be included on the board? What business sectors should the board represent? What skills should be expectations related to fundraising and other contributions to the functioning of the organization? I would suggest that there are four critical conversations that are helpful to creating a strategic nonprofit board.
The first critical conversation is about the foundation of a nonprofit board is a discussion of the board’s role in governance. Governance has several dimensions the first of which is to provide strategic direction to assist the nonprofit fulfill its mission. Board members should bring, first and foremost, the ability to think strategically, systemically and systematically. The second most important function of board members is the ability to provide oversight. Inherent in oversight is the spirit of inquiry and active participation. Governance means that board members ask reasonable questions to ensure that the agency programs and operational practices are compliant with legal requirements, the agency’s mission, agency policies, and any restrictions placed on contributions by donors and other funding sources. Ensuring adequate fiscal control and appropriate use of funds is another governance function of a board. A final governance function is to ensure oversight of the executive director of the agency. The conversation about governance is to assess the strength of your board in ensuring these functions. Are the skills and knowledge of board members adequate to provide governance? How do you measure it? How do to re-measure it as the board membership changes?
The second conversation relates to the board’s ability to provide strategic guidance to the agency operations. Board members are not expected to serve as “quasi-staff” working for the agency as HR consultant, accountant, etc., however, as you consider the operational functions of the agency such as human resources, accounting, marketing/public relations, program planning and evaluation, and risk management, there is a legitimate question of does your board posses the skills and knowledge to help guide the agency to build a strong organizational capacity? The distinction between providing strategic guidance and serving as “quasi-staff” is important. It is temping for smaller nonprofits to try and identify board members who can provide pro-bono human resource or marketing experience but such a strategy can cause potential conflict of interest between the governance of the operations and the actual operations. Boards members can’t effectively govern and provide direct operational support. Board guidance questions, observes and reflects on organizational operations but rarely, if ever should the board get operational. Guiding the development of organizational capacity becomes more important during times of organizational growth or down-sizing and is also important during times of crisis or transition, such as when the executive director leaves the agency. The strategic board conversation then becomes about the adequacy of the board to provide guidance related to organizational development. Does the board collectively possess the skills (or have access to folks who do), when the board is needed to support organizational capcity development?
The third strategic board conversation relates to the board’s understanding and more importantly, content expertise related to the mission of the non-profit. If the organization mission is related to positive youth development or housing services, what level of expertise in those issues do board members have? Again the conversation is not about board members providing operational support to the agency but strategic support. Do board members understand the current and emerging trends related to positive youth development or affordable housing issues? Do board members have expertise to develop informed program directions or positive strategies that will support the growth and development of the agency as it seeks to meet the mission-driven needs in the community?
The fourth strategic board development conversation is about the board and fundraising goals and strategies of the agency. Conventional wisdom drives many nonprofits to seek, as the Holy Grail, influential board members connected to potential donors or at the least, board members willing to make an “ask” for money. Unfortunately this framework truncates the strategic discussion. In reality boards should seeks members who can provide strategic support to the fundraising mix unique to the agency. So, for example, if a nonprofit is heavily dependent upon government contracts the agency would benefit by board members who can help the agency provide maintain strong relations with the government agencies. Conversely a board that seeks to develop a strong community of small donors, a tactical approach for the board would be to seek board members with experience in grassroots community organizing, the use of technology-based social media tools, or small event planning.
Taken together, developing a strategic board requires several strategic conversations about governance, organizational capacity, content expertise and fundraising. These conversations should be supported by honest assessments of skills that comprise the current board. Out of such conversations comes a clearer strategic intent that informs board recruitment and can subsequently organize and focus board training and board operations.
Here is a link to a self assessment spreadsheet that I developed to support the start of conversations.